Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of ‘large accelerated filer,’ ‘accelerated filer’, ‘smaller reporting company’ and ‘emerging growth company’ in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

As of ~~July~~October 22, 2021, there were ~~99,144,200~~99,169,700 shares of the registrant’s common stock outstanding.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (dollars in millions — except share data)

	June 30,			December 31,			September 30,			December 31,
	2021			2020			2021			2020
Assets
Cash and due from banks, including restricted balances of $25.4 at June 30, 2021 and $41.7 at December 31, 2020 (see Note 8 for amounts pledged)	$	146.6		$	174.6
Interest bearing cash, including restricted balances of $47.3 at June 30, 2021 and $2.6 at December 31, 2020 (see Note 8 for amounts pledged)		5,134.1			3,837.1
Cash and due from banks, including restricted balances of $34.2 at September 30, 2021 and $41.7 at December 31, 2020 (see Note 8 for amounts pledged)							$	169.7		$	174.6
Interest bearing cash, including restricted balances of $59.4 at September 30, 2021 and $2.6 at December 31, 2020 (see Note 8 for amounts pledged)								4,428.8			3,837.1
Securities purchased under agreement to resell		150.0			150.0			100.0			150.0
Investment securities (see Notes 6 and 8 for amounts pledged)		5,295.8			6,889.0			5,775.2			6,889.0
Assets held for sale		51.5			721.2			95.8			721.2
Loans (see Note 8 for amounts pledged)		33,711.1			36,144.6			33,461.0			36,144.6
Allowance for credit losses		(850.6	)		(1,063.8	)		(790.4	)		(1,063.8	)
Total loans, net of allowance for credit losses		32,860.5			35,080.8			32,670.6			35,080.8
Operating lease equipment, net (see Note 8 for amounts pledged)		7,781.8			7,836.6			7,937.5			7,836.6
Bank-owned life insurance		1,185.2			1,168.8			1,193.4			1,168.8
Other assets, including $302.1 at June 30, 2021 and $431.6 at December 31, 2020, at fair value		2,098.2			2,248.5
Other assets, including $268.5 at September 30, 2021 and $431.6 at December 31, 2020 at fair value								2,049.0			2,248.5
Total Assets	$	54,703.7		$	58,106.6		$	54,420.0		$	58,106.6
Liabilities
Deposits	$	41,271.0		$	43,071.6		$	40,237.3		$	43,071.6
Credit balances of factoring clients		1,530.5			1,719.9			1,556.6			1,719.9
Other liabilities, including $71.7 at June 30, 2021 and $79.2 at December 31, 2020, at fair value		1,622.3			1,754.9
Borrowings, including $0.0 at June 30, 2021 and $500.0 at December 31, 2020 contractually due within twelve months		4,244.1			5,837.3
Other liabilities, including $77.9 at September 30, 2021 and $79.2 at December 31, 2020 at fair value								2,203.9			1,754.9
Borrowings, including $1,147.0 at September 30, 2021 and $500.0 at December 31, 2020 contractually due within twelve months								4,247.6			5,837.3
Total Liabilities		48,667.9			52,383.7			48,245.4			52,383.7
Stockholders’ Equity
Preferred Stock: $0.01 par value, 100,000,000 shares authorized, 8,325,000 shares issued and outstanding at June 30, 2021 and December 31, 2020		525.0			525.0
Preferred Stock: $0.01 par value, 100,000,000 shares authorized, 8,325,000 shares issued and outstanding at September 30, 2021 and December 31, 2020								525.0			525.0
Common Stock: $0.01 par value, 600,000,000 shares authorized
Issued: 164,106,299 at June 30, 2021 and 163,309,861 at December 31, 2020		1.6			1.6
Outstanding: 99,143,345 at June 30, 2021 and 98,609,395 at December 31, 2020
Issued: 164,134,157 at September 30, 2021 and 163,309,861 at December 31, 2020								1.6			1.6
Outstanding: 99,167,023 at September 30, 2021 and 98,609,395 at December 31, 2020
Paid-in capital		6,922.5			6,892.0			6,930.1			6,892.0
Retained earnings		1,873.7			1,428.3			2,011.0			1,428.3
Accumulated other comprehensive income (loss)		(115.4	)		35.7			(121.2	)		35.7
Treasury stock: 64,962,954 shares at June 30, 2021 and 64,700,466 shares at December 31, 2020 at cost		(3,171.6	)		(3,159.7	)
Treasury stock: 64,967,134 shares at September 30, 2021 and 64,700,466 shares at December 31, 2020 at cost								(3,171.9	)		(3,159.7	)
Total Common Stockholders’ Equity		5,510.8			5,197.9			5,649.6			5,197.9
Total Equity		6,035.8			5,722.9			6,174.6			5,722.9
Total Liabilities and Equity	$	54,703.7		$	58,106.6		$	54,420.0		$	58,106.6

The accompanying notes are an integral part of these consolidated financial statements.

	Quarters Ended June 30,						Six Months Ended June 30,						Quarters Ended September 30,					Nine Months Ended September 30,
	2021			2020			2021			2020			2021			2020		2021			2020
Interest income
Interest and fees on loans	$	355.7		$	417.2		$	719.7		$	884.8		$	341.9		$	395.8	$	1,061.6		$	1,280.6
Other interest and dividends		17.4			29.7			41.5			75.7			17.9			27.5		59.4			103.2
Interest income		373.1			446.9			761.2			960.5			359.8			423.3		1,121.0			1,383.8
Interest expense
Interest on deposits		50.7			138.3			111.9			294.9			47.3			103.2		159.2			398.1
Interest on borrowings		56.1			64.2			114.5			133.3			55.7			62.3		170.2			195.6
Interest expense		106.8			202.5			226.4			428.2			103.0			165.5		329.4			593.7
Net interest revenue		266.3			244.4			534.8			532.3			256.8			257.8		791.6			790.1
Provision for credit losses		(72.2	)		223.6			(189.6	)		737.5			(67.1	)		63.3		(256.7	)		800.8
Net interest revenue, after credit provision		338.5			20.8			724.4			(205.2	)		323.9			194.5		1,048.3			(10.7	)
Non-interest income
Rental income on operating leases		188.2			200.9			382.9			410.7			186.2			201.3		569.1			612.0
Other non-interest income		160.7			102.6			390.6			233.2			124.7			146.0		515.3			379.2
Total non-interest income		348.9			303.5			773.5			643.9			310.9			347.3		1,084.4			991.2
Total revenue, net of interest expense and credit provision		687.4			324.3			1,497.9			438.7			634.8			541.8		2,132.7			980.5
Non-interest expenses
Depreciation on operating lease equipment		82.8			81.1			167.5			159.4			85.1			82.5		252.6			241.9
Maintenance and other operating lease expenses		54.8			56.1			106.4			109.7			50.5			48.6		156.9			158.3
Operating expenses		251.2			360.4			525.2			694.8			268.2			295.5		793.4			990.3
Goodwill impairment		-			-			-			344.7			—			—		—			344.7
(Gain) loss on debt extinguishment and deposit redemption		-			(14.8	)		0.1			(14.8	)		—			—		0.1			(14.8	)
Total non-interest expenses		388.8			482.8			799.2			1,293.8			403.8			426.6		1,203.0			1,720.4
Income (loss) before provision (benefit) for income taxes		298.6			(158.5	)		698.7			(855.1	)		231.0			115.2		929.7			(739.9	)
Provision (benefit) for income taxes		71.7			(73.2	)		168.0			(145.5	)		55.5			29.5		223.5			(116.0	)
Net income (loss)	$	226.9		$	(85.3	)	$	530.7		$	(709.6	)	$	175.5		$	85.7	$	706.2		$	(623.9	)
Preferred stock dividends		12.3			12.3			15.1			16.1			2.8			2.8		17.9			18.9
Net income (loss) available to common shareholders	$	214.6		$	(97.6	)	$	515.6		$	(725.7	)	$	172.7		$	82.9	$	688.3		$	(642.8	)
Income (loss) per common share
Basic	$	2.17		$	(0.99	)	$	5.21		$	(7.39	)	$	1.74		$	0.84	$	6.95		$	(6.54	)
Diluted	$	2.14		$	(0.99	)	$	5.17		$	(7.39	)	$	1.72		$	0.84	$	6.89		$	(6.54	)
Average number of common shares (thousands)
Basic		99,110		��	98,438			98,961			98,263			99,168			98,523		99,031			98,350
Diluted		100,340			98,438			99,708			98,263			100,432			98,556		99,950			98,350

The accompanying notes are an integral part of these consolidated financial statements.

	Quarters Ended June 30,					Six Months Ended June 30,						Quarters Ended September 30,						Nine Months Ended September 30,
	2021		2020			2021			2020			2021			2020			2021			2020
Net income (loss)	$	226.9	$	(85.3	)	$	530.7		$	(709.6	)	$	175.5		$	85.7		$	706.2		$	(623.9	)
Other comprehensive (loss) income, net of tax
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments		-		(0.1	)		(0.1	)		(1.0	)		10.3			0.6			10.2			(0.4	)
Net unrealized (losses) gains on available for sale securities		32.4		(1.0	)		(151.7	)		116.0			(16.5	)		(20.1	)		(168.2	)		95.9
Changes in benefit plans net gains and prior service (cost)/credit		0.4		0.1			0.7			2.9			0.4			0.1			1.1			3.0
Other comprehensive (loss) income, net of tax	$	32.8	$	(1.0	)	$	(151.1	)	$	117.9		$	(5.8	)	$	(19.4	)	$	(156.9	)	$	98.5
Comprehensive income (loss)	$	259.7	$	(86.3	)	$	379.6		$	(591.7	)	$	169.7		$	66.3		$	549.3		$	(525.4	)

The accompanying notes are an integral part of these consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) (dollars in millions)

	Preferred Stock		Common Stock		Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock, at Cost			Total Equity			Preferred Stock		Common Stock		Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock, at Cost			Total Equity
March 31, 2021	$	525.0	$	1.6	$	6,914.3	$	1,694.5		$	(148.2	)	$	(3,171.5	)	$	5,815.7
June 30, 2021																			$	525.0	$	1.6	$	6,922.5		$	1,873.7		$	(115.4	)	$	(3,171.6	)	$	6,035.8
Net income		—		—	—			226.9			—			—			226.9			—		—	—				175.5			—			—			175.5
Other comprehensive income, net of tax		—		—		—		—			32.8			—			32.8
Dividends paid ($0.35 per common share and $29.00 per preferred A share and $0.35 per preferred B share)		—		—	—			(47.7	)		—			—			(47.7	)
Other comprehensive loss, net of tax																				—		—		—			—			(5.8	)		—			(5.8	)
Dividends paid ($0.35 per common share and $0.35 per preferred B share)																				—		—	—				(38.2	)		—			—			(38.2	)
Amortization of stock compensation expenses		—		—		7.2		—			—			(0.1	)		7.1			—		—		6.7			—			—			(0.3	)		6.4
Employee stock purchase plan		—		—		1.0	—				—			—			1.0			—		—		0.9		—				—			—			0.9
June 30, 2021	$	525.0	$	1.6	$	6,922.5	$	1,873.7		$	(115.4	)	$	(3,171.6	)	$	6,035.8
September 30, 2021																			$	525.0	$	1.6	$	6,930.1		$	2,011.0		$	(121.2	)	$	(3,171.9	)	$	6,174.6

March 31, 2020	$	525.0	$	1.6	$	6,873.3	$	1,552.1		$	66.8		$	(3,158.0	)	$	5,860.8
Net loss		—		—		—		(85.3	)		—			—			(85.3	)
June 30, 2020																			$	525.0	$	1.6	$	6,885.5		$	1,419.4		$	65.8		$	(3,158.0	)	$	5,739.3
Net income																				—		—		—			85.7			—			—			85.7
Other comprehensive loss, net of tax	—		—		—		—				(1.0	)	—				(1.0	)	—		—		—			—				(19.4	)	—				(19.4	)
Dividends paid ($0.35 per common share and $29.00 per preferred A share and $0.35 per preferred B share)		—		—		—		(47.4	)		—			—			(47.4	)
Dividends paid ($0.35 per common share and $0.35 per preferred B share)																				—		—		—			(38.0	)		—			—			(38.0	)
Amortization of stock compensation expenses		—		—		11.1		—			—			—			11.1			—		—		(4.6	)		—			—			(0.2	)		(4.8	)
Employee stock purchase plan		—		—		1.1		—			—			—			1.1			—		—		1.2			—			—			—			1.2
June 30, 2020	$	525.0	$	1.6	$	6,885.5	$	1,419.4		$	65.8		$	(3,158.0	)	$	5,739.3
September 30, 2020																			$	525.0	$	1.6	$	6,882.1		$	1,467.1		$	46.4		$	(3,158.2	)	$	5,764.0

December 31, 2020	$	525.0	$	1.6	$	6,892.0	$	1,428.3		$	35.7		$	(3,159.7	)	$	5,722.9		$	525.0	$	1.6	$	6,892.0		$	1,428.3		$	35.7		$	(3,159.7	)	$	5,722.9
Net income		—		—		—		530.7			—			—			530.7			—		—		—			706.2			—			—			706.2
Other comprehensive loss, net of tax		—		—		—		—			(151.1	)		—			(151.1	)		—		—		—			—			(156.9	)		—			(156.9	)
Dividends paid ($0.70 per common share and $29.00 per preferred A share and $0.70 per preferred B share)		—		—		—		(85.3	)		—			—			(85.3	)
Dividends paid ($1.05 per common share and $29.00 per preferred A share and $1.05 per preferred B share)																				—		—		—			(123.5	)		—			—			(123.5	)
Amortization of stock compensation expenses		—		—		28.5		—			—			(11.9	)		16.6			—		—		35.2			—			—			(12.2	)		23.0
Employee stock purchase plan		—		—		2.0		—			—			—			2.0			—		—		2.9			—			—			—			2.9
June 30, 2021	$	525.0	$	1.6	$	6,922.5	$	1,873.7		$	(115.4	)	$	(3,171.6	)	$	6,035.8
September 30, 2021																			$	525.0	$	1.6	$	6,930.1		$	2,011.0		$	(121.2	)	$	(3,171.9	)	$	6,174.6

December 31, 2019	$	525.0	$	1.6	$	6,853.7	$	2,307.6		$	(52.1	)	$	(3,296.8	)	$	6,339.0		$	525.0	$	1.6	$	6,853.7		$	2,307.6		$	(52.1	)	$	(3,296.8	)	$	6,339.0
Adoption of ASU 2016-13		—		—		—		(82.4	)		—			—			(82.4	)		—		—		—			(82.4	)		—			—			(82.4	)
Net loss		—		—		—		(709.6	)		—			—			(709.6	)		—		—		—			(623.9	)		—			—			(623.9	)
Other comprehensive loss, net of tax		—		—		—		—			117.9			—			117.9
Dividends paid ($0.70 per common share and $29.00 per preferred A share and $0.83 per preferred B share)		—		—		—		(86.1	)		—			—			(86.1	)
Other comprehensive income, net of tax																				—		—		—			—			98.5			—			98.5
Dividends paid ($1.05 per common share and $29.00 per preferred A share and $1.18 per preferred B share)																				—		—		—			(124.1	)		—			—			(124.1	)
Issuance of common stock - acquisition		—		—		—		(10.1	)		—			151.3			141.2			—		—		—			(10.1	)		—			151.3			141.2
Amortization of stock compensation expenses		—		—		29.9		—			—			(12.5	)		17.4			—		—		25.3			—			—			(12.7	)		12.6
Employee stock purchase plan		—		—		1.9		—			—			—			1.9			—		—		3.1			—			—			—			3.1
June 30, 2020	$	525.0	$	1.6	$	6,885.5	$	1,419.4		$	65.8		$	(3,158.0	)	$	5,739.3
September 30, 2020																			$	525.0	$	1.6	$	6,882.1		$	1,467.1		$	46.4		$	(3,158.2	)	$	5,764.0

The accompanying notes are an integral part of these consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (dollars in millions)

	Six Months Ended June 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
Cash Flows from Operations
Net income (loss)	$	530.7		$	(709.6	)	$	706.2		$	(623.9	)
Adjustments to reconcile net income (loss) to net cash flows from operations:
(Benefit) provision for credit losses		(189.6	)		737.5			(256.7	)		800.8
Depreciation on operating lease equipment		167.5			159.4			252.6			241.9
Amortization of stock compensation expenses		28.5			29.9			35.2			25.3
Net gain on asset sales and impairments on assets held for sale		(229.1	)		(85.0	)		(284.6	)		(150.2	)
Loss on debt extinguishment and deposit redemption		0.1			(14.8	)		0.1			(14.8	)
Provision for deferred income taxes		148.0			(127.2	)
Increase (decrease) in loans held for sale		0.4			(51.7	)
Provision (benefit) for deferred income taxes								193.4			(115.9	)
Increase in loans held for sale								(24.5	)		(25.4	)
Goodwill impairment		—			344.7			—			344.7
Decrease (increase) in other assets		227.9			(383.5	)		240.0			(285.8	)
Decrease in other liabilities		(267.9	)		(74.4	)		(286.6	)		(44.9	)
Other operating activities		42.0			47.1			72.2			52.7
Net cash flows provided by (used in) operations		458.5			(127.6	)
Net cash flows provided by operations								647.3			204.5
Cash Flows from Investing Activities
Changes in loans, net		1,868.0			(595.7	)		2,009.2			(203.6	)
Purchases of investment securities and securities purchased under agreement to resell		(2,247.4	)		(2,283.9	)		(2,643.3	)		(4,147.8	)
Proceeds from sales and maturities of investment securities and securities purchased under agreement to resell		3,673.4			5,500.6			4,185.7			6,619.9
Proceeds from asset and receivable sales		1,283.7			243.3			1,505.0			494.5
Purchases of assets to be leased and other equipment		(275.6	)		(685.3	)		(550.9	)		(857.7	)
Proceeds from sale of OREO, net of repurchases		1.3			9.0			1.6			11.9
Purchase of bank owned life insurance		—			(100.0	)		—			(100.0	)
Acquisition, net of cash received		—			(727.1	)		—			(720.1	)
Other investing activities		—			(69.0	)		5.6			(67.4	)
Net cash flows provided by investing activities		4,303.4			1,291.9			4,512.9			1,029.7
Cash Flows from Financing Activities
Proceeds from the issuance of term debt and FHLB advances		603.5			2,204.1			604.8			2,204.8
Repayments of term debt and FHLB advances		(2,204.7	)		(1,368.8	)		(2,212.5	)		(1,675.9	)
Net (decrease) increase in deposits		(1,801.1	)		3,689.3			(2,835.1	)		2,581.6
Dividends paid		(85.3	)		(86.1	)		(123.5	)		(124.1	)
Other financing activities		(6.3	)		(203.7	)		(7.0	)		(199.1	)
Net cash flows (used in) provided by financing activities		(3,493.9	)		4,234.8			(4,573.3	)		2,787.3
Effect of exchange rate changes on cash, cash equivalents and restricted cash		1.0			(4.4	)		(0.1	)		(1.5	)
Increase (decrease) in cash, cash equivalents and restricted cash		1,269.0			5,394.7			586.8			4,020.0
Cash, cash equivalents and restricted cash beginning of period		4,011.7			2,685.6			4,011.7			2,685.6
Cash, cash equivalents and restricted cash end of period	$	5,280.7		$	8,080.3		$	4,598.5			6,705.6
Supplementary Cash Flow Disclosures
Interest paid	$	(221.8	)	$	(425.3	)	$	(355.0	)		(630.1	)
Federal, foreign, state and local income taxes (paid) refunded, net		(8.6	)		1.1			(12.4	)		72.1
Supplementary Non Cash Flow Disclosure
Transfer of assets from held for investment to held for sale		357.0			65.7		$	495.5			190.8
Transfer of assets from held for sale to held for investment		10.8			18.5			11.2			25.7
Transfers of assets to OREO		2.2			0.3			4.3			0.3
Commitments extended during the period on affordable housing investment credits		65.4			52.1			80.4			84.9
Issuance of common stock - acquisition		—			141.2			—			141.2

The following tables shows a reconciliation of cash, cash equivalents and restricted cash on the Balance Sheet to that presented in the above Statements of Cash Flow.

The accompanying notes are an integral part of these consolidated financial statements.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

CIT Group Inc. is a bank holding company ("BHC") and a financial holding company ("FHC"). CIT Group Inc., together with its subsidiaries (collectively "we", "our", "CIT" or the "Company"), is regulated by the Board of Governors of the Federal Reserve System ("FRB") and the Federal Reserve Bank of New York ("FRBNY") under the U.S. Bank Holding Company Act of 1956, as amended. CIT was formed in 1908 and provides financing, leasing and advisory services, principally to middle-market companies in a wide variety of industries, primarily in North America.

We also provide banking and related services to commercial and individual customers through our banking subsidiary, CIT Bank, N.A. ("CIT Bank" or the "Bank"), which includes a regional branch network of approximately 80 branches and its online bank.

CIT Bank is regulated by the Office of the Comptroller of the Currency of the U.S. Department of the Treasury ("OCC"). In addition, CIT Bank, as an insured depository institution, is supervised by the Federal Deposit Insurance Corporation (“FDIC”).

These consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q for interim financial information and accordingly do not include all information and note disclosures required by generally accepted accounting principles in the United States of America (“GAAP”) for complete financial statements. ~~The~~In the opinion of management, the financial statements in this Form 10-Q ~~in the opinion of management,~~ include all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of CIT’s financial position, results of operations and cash flows in accordance with GAAP. These consolidated financial statements should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2020 ("2020 Form 10-K").

The accounting and financial reporting policies of CIT conform to GAAP and the preparation of the consolidated financial statements is in conformity with GAAP, which requires management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates and assumptions. Some of the more significant estimates include: Allowance for Credit Losses (“ACL”) and the realizability of deferred tax assets. Additionally, where applicable, the policies conform to accounting and reporting guidelines prescribed by bank regulatory authorities.

The accompanying consolidated financial statements include financial information related to CIT and its majority-owned subsidiaries and those variable interest entities (“VIEs”) where the Company is the primary beneficiary (“PB”), if any.

In preparing the consolidated financial statements, inter-company accounts and transactions have been eliminated. Assets held in an agency or fiduciary capacity are not included in the consolidated financial statements.

The current period’s results of operations do not necessarily indicate the results that may be expected for any other interim period or for the full year as a whole.

On October 16, 2020, First Citizens BancShares, Inc. ("First Citizens"), the parent company of First-Citizens Bank & Trust Company, and CIT, the parent company of CIT Bank, N.A., jointly announced that they had entered into a definitive agreement under which the companies will combine in an all-stock merger. On July 14, 2021, CIT and First Citizens jointly announced that the proposal to merge the two companies ~~has~~ received regulatory approval from the FDIC. The merger ~~has~~had already received approval from the Office of the North Carolina Commissioner of Banks. Completion of the proposed merger remains subject to approval from the ~~Board of Governors of the Federal Reserve System, and closing is expected in the third quarter, subject to such regulatory approval~~FRB, and the satisfaction or waiver of other customary closing conditions. ~~See~~ ~~Note 16 – Subsequent Event~~.

On September 30, 2021, CIT Group Inc. and First Citizens jointly announced that the two companies agreed to extend the merger agreement from October 15, 2021, to March 1, 2022.

The Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) and Interagency Statement

On March 27, 2020, the CARES Act was signed into law. The CARES Act gives financial institutions temporary relief from the accounting and disclosure requirements related to troubled debt restructurings (“TDRs”) under ASC 310-40 and past due and non-accrual reporting in certain situations relating to the COVID-19 pandemic. With respect to past due and non-accrual loans, the CARES Act provides that financial institutions are not expected to designate loans with payment accommodations granted due to COVID-19 as past due or non-accrual if they were current on the date used to determine the borrower’s delinquency status for the purpose of providing the deferment.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

Additionally, on April 7, 2020, a group of federal and state government banking agencies issued an Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus (Revised) (the

~~CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)~~

~~“Interagency~~ “Interagency Statement”) that offers some practical expedients for evaluating whether loan modifications that occur in response to the COVID-19 pandemic are TDRs. The Interagency Statement interprets, but does not suspend, ASC ~~310-40, as~~310-40. Under the Interagency Statement, any loan modification that meets either of these practical expedients would not automatically be considered a TDR because the borrower is presumed not to be experiencing financial difficulty at the time of the loan modification.

CIT applies the TDR provisions of the CARES Act on a product-type basis, or on a loan-by-loan basis, for eligible loan modifications. For eligible loans for which the CARES Act is not applied, CIT follows the applicable guidance of the Interagency Statement. For payment deferrals granted to borrowers impacted by COVID-19, CIT has elected to continue to recognize interest income (at a modified effective rate) subject to consideration of whether the loan should be placed on non-accrual status. In addition, CIT monitors deferred amounts and establishes a credit loss reserve for the estimated amount of any balances that will not be recovered for COVID-19 loans.

After the initial payment deferral period granted due to COVID-19, on a case by case basis where requested, borrowers may be offered an additional deferral of up to 90 days pursuant to the CARES Act or Interagency Statement guidance outlined above. After the deferral period, amounts deferred must be repaid based on modified terms, including adding the unpaid amounts to the end of the contract term, spread throughout the remaining term, or other arrangements made on a case by case basis.

Accounting for Lease Concessions Related to the Effects of the COVID-19 Pandemic

On April 10, 2020, the FASB Staff issued a question-and-answer document (the “Lease Concessions Q&A”) on Topic 842: Accounting for Lease Concessions Related to the Effects of the COVID-19 Pandemic. The Lease Concessions Q&A provides that entities may elect to apply or not apply the lease modification guidance in ASC 842, Leases, for lease concessions provided by lessors as a result of the COVID-19 pandemic. This election is available for concessions that result in the total payments required by the modified contract being substantially the same as or less than total payments required by the original contract. CIT has elected not to apply the lease modification guidance in ASC 842 for such lease concessions as permitted by the Lease Concessions Q&A. We account for these lease concessions prospectively recognizing income on a straight-line basis for operating leases and a modified effective rate for finance leases.

Significant accounting policies are included in the Company's 2020 Form 10-K. There were no material changes to these policies during the ~~six~~nine months ended ~~June~~September 30, 2021.

The following pronouncements were issued by the Financial Accounting Standards Board (“FASB”) and adopted by CIT as of January 1, 2021. Refer to Note 1 – Business and Summary of Significant Accounting Policies in our 2020 Form 10-K for a detailed description of these pronouncements:

The following accounting pronouncements were issued by the FASB but are not yet effective for CIT.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

On January 1, 2020, CIT Bank acquired Mutual of Omaha Bank (“MOB”), the savings bank subsidiary of Mutual of Omaha Insurance Company and Omaha Financial Holdings, Inc., for approximately $1 billion in exchange for 100% of all outstanding shares of MOB common stock. The original consideration was comprised of approximately $850 million in cash and approximately 3.1 million shares of CIT Group Inc. common stock (valued at approximately $141 million based on the closing market price on December 31, 2019, the last trading price before the acquisition).

The acquisition enhances CIT’s deposit and commercial banking capabilities by adding a new channel of deposits related to homeowners’ associations (“HOA”) and enhances CIT’s middle-market commercial banking business through the addition of relationship banking teams and expanded product and technology solutions. The acquisition was accounted for as a business combination.

Assets acquired totaled approximately $8.6 billion, including $6.3 billion of loans, $115.2 million of goodwill and $102.6 million of intangible assets and included $7.6 billion of assumed liabilities, including $7.0 billion of deposits, and 25 bank branches. The assets acquired, liabilities assumed, and consideration exchanged were recorded at their estimated fair values.

Interest income, non-interest income and net loss of ~~$134.9~~$191.7 million, ~~$19.8~~$27.6 million and ~~$87.3~~$61.8 million, respectively, related to MOB were included in CIT’s Consolidated Statement of Operations for the ~~six~~nine months ended ~~June~~September 30, 2020. The MOB net loss included $44.8 million of MOB ~~Day~~day 1 provision for credit losses related to the non-PCD loans. Operating expenses for the ~~six~~nine months ended ~~June~~September 30, 2020 included ~~$37.0~~$49.6 million of merger and integration costs related to MOB. Operations of MOB were fully integrated during 2020.

Unless otherwise noted, loans held for sale are not included in the amounts presented throughout this note.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

	June 30, 2021						December 31, 2020						September 30, 2021						December 31, 2020
	Domestic		International		Total		Domestic		International		Total		Domestic		International		Total		Domestic		International		Total
Commercial Banking	$	26,092.0	$	1,173.9	$	27,265.9	$	27,323.4	$	1,313.1	$	28,636.5	$	25,851.9	$	1,365.2	$	27,217.1	$	27,323.4	$	1,313.1	$	28,636.5
Consumer Banking⁽¹⁾		6,445.2		-		6,445.2		7,508.1		-		7,508.1		6,243.9		—		6,243.9		7,508.1		—		7,508.1
Total	$	32,537.2	$	1,173.9	$	33,711.1	$	34,831.5	$	1,313.1	$	36,144.6	$	32,095.8	$	1,365.2	$	33,461.0	$	34,831.5	$	1,313.1	$	36,144.6

The following table presents selected components of the net investment in loans:

	June 30,			December 31,			September 30,			December 31,
	2021			2020			2021			2020
Unearned income	$	(358.9	)	$	(373.9	)	$	(353.8	)	$	(373.9	)
Net unamortized discounts		(333.7	)		(434.4	)
Unamortized (discounts) premiums								(284.4	)		(434.4	)
Net unamortized deferred costs		38.8			35.8			39.8			35.8

Certain of the following tables present credit-related information at the “class” level. A class is generally a disaggregation of a portfolio segment. In determining the classes, CIT considered the loan characteristics and methods it applies in monitoring and

~~CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)~~

Management monitors credit quality of commercial loans and financing leases based upon risk rating classifications consistent with bank regulatory guidance and consumer loans based upon FICO scores and loan-to-value ratios (“LTV”).

Commercial criticized loans include loans with a rating of special mention or classified.

For consumer loans, we monitor credit quality utilizing current LTV of the underlying collateral to assess potential loss severity in the event of default and the borrower FICO scores to evaluate borrowers’ credit payment history. The Company examines LTV migration and stratifies LTV into categories to monitor risk in the loan classes. The Company periodically updates the property values of real estate collateral (for home equity and residential mortgages) to calculate current LTV ratios, adjusted based on the Case-Shiller Home Price Indices. A loan to a borrower with a low FICO score (less than 660) is considered to be of higher risk than a loan to a borrower with a higher FICO score. Generally, a loan to a borrower with a high LTV ratio and a low FICO score is at greater risk of default than a loan to a borrower that has both a high LTV ratio and a high FICO score.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table summarizes commercial loans disaggregated by year of origination and by risk ~~rating. The~~rating, while the consumer loan LTV ratios and FICO scores tables summarize loans by year of ~~origination are also presented below. The~~origination. These tables reflect the amortized cost basis of the respective commercial and consumer loans. Accrued interest receivable ~~(within other assets)~~ is not reported ~~separately from~~with the loan’s amortized cost ~~basis.~~basis and is reported in other assets.

																			Term Loans by Origination Year														Revolving Loans Converted
Grade	Term Loans by Origination Year														Revolving Loans Converted				2021		2020		2019		2018		2017		2016 & Prior		Revolving Loans		to Term Loans		Total
June 30, 2021	2021		2020		2019		2018		2017		2016 & Prior		Revolving Loans		to Term Loans		Total⁽¹⁾
September 30, 2021
Commercial Finance
Pass	$	3,346.6	$	2,657.6	$	2,119.7	$	1,782.6	$	637.0	$	1,016.4	$	2,335.4	$	44.6	$	13,939.9	$	4,518.2	$	2,426.7	$	1,984.6	$	1,414.5	$	460.9	$	943.5	$	2,486.0	$	60.6	$	14,295.0
Special Mention		24.6		89.5		203.0		161.1		4.1		117.1		180.6		—		780.0		22.3		69.4		185.8		146.7		3.0		72.4		147.7		0.5		647.8
Classified-accrual		37.9		41.8		199.8		107.0		175.0		242.7		162.8		5.4		972.4		35.7		71.2		237.0		132.7		108.4		184.5		158.8		2.8		931.1
Classified-non-accrual		0.4		0.5		8.0		41.4		11.2		123.3		92.8		—		277.6		—		—		1.3		24.4		10.8		112.5		76.3		—		225.3
Total Commercial Finance		3,409.5		2,789.4		2,530.5		2,092.1		827.3		1,499.5		2,771.6		50.0		15,969.9		4,576.2		2,567.3		2,408.7		1,718.3		583.1		1,312.9		2,868.8		63.9		16,099.2
Real Estate Finance
Pass		278.7		1,083.9		1,867.4		868.0		407.3		794.5		4.6		—		5,304.4		457.0		1,112.9		1,824.6		666.9		335.6		797.6		2.8		—		5,197.4
Special Mention		—		57.4		196.6		63.5		94.1		13.4		—		—		425.0		—		87.1		100.3		79.5		58.9		13.3		—		—		339.1
Classified-accrual		—		0.3		325.3		198.1		87.1		153.1		—		—		763.9		—		0.3		411.5		240.7		96.4		82.0		—		—		830.9
Classified-non-accrual		—		—		—		0.2		15.1		64.0		—		—		79.3		—		—		—		0.2		1.9		61.3		—		—		63.4
Total Real Estate Finance		278.7		1,141.6		2,389.3		1,129.8		603.6		1,025.0		4.6		—		6,572.6		457.0		1,200.3		2,336.4		987.3		492.8		954.2		2.8		—		6,430.8
Business Capital
Pass		1,036.1		1,384.8		1,082.7		557.4		196.2		56.9		4.6		—		4,318.7		1,437.9		1,263.1		957.1		465.2		154.5		33.0		7.8		—		4,318.6
Special Mention		8.1		30.8		41.3		23.9		12.2		4.1		—		—		120.4		12.7		25.2		36.9		18.7		10.7		2.9		—		—		107.1
Classified-accrual		10.7		32.3		53.7		44.2		17.3		3.3		—		—		161.5		21.7		33.3		58.9		31.4		10.2		1.4		—		—		156.9
Classified-non-accrual		0.9		10.7		27.9		11.4		6.3		3.0		—		—		60.2		2.6		9.5		12.5		10.5		2.9		2.8		—		—		40.8
Total Business Capital		1,055.8		1,458.6		1,205.6		636.9		232.0		67.3		4.6		—		4,660.8		1,474.9		1,331.1		1,065.4		525.8		178.3		40.1		7.8		—		4,623.4
Rail
Pass		—		—		0.7		—		—		61.9		—		—		62.6		—		—		0.6		—		—		63.1		—		—		63.7
Total Rail		—		—		0.7		—		—		61.9		—		—		62.6		—		—		0.6		—		—		63.1		—		—		63.7
Total Commercial Banking
Commercial Banking
Pass		4,661.4		5,126.3		5,070.5		3,208.0		1,240.5		1,929.7		2,344.6		44.6		23,625.6		6,413.1		4,802.7		4,766.9		2,546.6		951.0		1,837.2		2,496.6		60.6		23,874.7
Special Mention		32.7		177.7		440.9		248.5		110.4		134.6		180.6		—		1,325.4		35.0		181.7		323.0		244.9		72.6		88.6		147.7		0.5		1,094.0
Classified-accrual		48.6		74.4		578.8		349.3		279.4		399.1		162.8		5.4		1,897.8		57.4		104.8		707.4		404.8		215.0		267.9		158.8		2.8		1,918.9
Classified-non-accrual		1.3		11.2		35.9		53.0		32.6		190.3		92.8		—		417.1		2.6		9.5		13.8		35.1		15.6		176.6		76.3		—		329.5
Total Commercial Banking		4,744.0		5,389.6		6,126.1		3,858.8		1,662.9		2,653.7		2,780.8		50.0		27,265.9		6,508.1		5,098.7		5,811.1		3,231.4		1,254.2		2,370.3		2,879.4		63.9		27,217.1
Consumer Banking - Consumer and Community Banking ⁽²⁾
Pass		109.8		321.7		151.3		95.8		46.6		93.8		0.5		—		819.5		166.1		274.1		145.3		97.7		47.0		82.0		2.4		—		814.6
Special Mention		—		—		10.1		3.2		4.4		3.7		—		—		21.4		—		—		10.0		3.2		4.4		3.7		—		—		21.3
Classified-accrual		—		17.3		27.5		27.0		15.3		22.2		—		—		109.3		—		7.4		27.3		26.9		12.0		16.8		—		—		90.4
Classified-non-accrual		—		—		19.6		4.4		3.1		7.2		—		—		34.3		—		—		17.0		3.6		4.2		7.1		—		—		31.9
Total Consumer Banking		109.8		339.0		208.5		130.4		69.4		126.9		0.5		—		984.5		166.1		281.5		199.6		131.4		67.6		109.6		2.4		—		958.2
Commercial Loans
Pass		4,771.2		5,448.0		5,221.8		3,303.8		1,287.1		2,023.5		2,345.1		44.6		24,445.1		6,579.2		5,076.8		4,912.2		2,644.3		998.0		1,919.2		2,499.0		60.6		24,689.3
Special Mention		32.7		177.7		451.0		251.7		114.8		138.3		180.6		—		1,346.8		35.0		181.7		333.0		248.1		77.0		92.3		147.7		0.5		1,115.3
Classified-accrual		48.6		91.7		606.3		376.3		294.7		421.3		162.8		5.4		2,007.1		57.4		112.2		734.7		431.7		227.0		284.7		158.8		2.8		2,009.3
Classified-non-accrual		1.3		11.2		55.5		57.4		35.7		197.5		92.8		—		451.4		2.6		9.5		30.8		38.7		19.8		183.7		76.3		—		361.4
Total Commercial Loans	$	4,853.8	$	5,728.6	$	6,334.6	$	3,989.2	$	1,732.3	$	2,780.6	$	2,781.3	$	50.0	$	28,250.4	$	6,674.2	$	5,380.2	$	6,010.7	$	3,362.8	$	1,321.8	$	2,479.9	$	2,881.8	$	63.9	$	28,175.3

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

Commercial Loans — Risk Rating by Class⁽¹⁾(dollars in millions) (continued)

																			Term Loans by Origination Year														Revolving Loans Converted
Grade	Term Loans by Origination Year														Revolving Loans Converted				2020		2019		2018		2017		2016		2015 & Prior		Revolving Loans		to Term Loans		Total
December 31, 2020	2020		2019		2018		2017		2016		2015 & Prior		Revolving Loans		to Term Loans		Total⁽¹⁾
Commercial Finance
Pass	$	4,819.9	$	2,132.5	$	2,000.1	$	678.0	$	181.1	$	745.6	$	3,329.4	$	61.1	$	13,947.7	$	4,819.9	$	2,132.5	$	2,000.1	$	678.0	$	181.1	$	745.6	$	3,329.4	$	61.1	$	13,947.7
Special Mention		81.2		206.4		210.8		18.4		30.8		119.9		313.3		2.8		983.6		81.2		206.4		210.8		18.4		30.8		119.9		313.3		2.8		983.6
Classified-accrual		82.4		161.7		49.8		169.2		107.2		183.1		314.2		5.6		1,073.2		82.4		161.7		49.8		169.2		107.2		183.1		314.2		5.6		1,073.2
Classified-non-accrual		0.5		9.0		53.9		9.6		22.1		60.7		83.6		—		239.4		0.5		9.0		53.9		9.6		22.1		60.7		83.6		—		239.4
Total Commercial Finance		4,984.0		2,509.6		2,314.6		875.2		341.2		1,109.3		4,040.5		69.5		16,243.9		4,984.0		2,509.6		2,314.6		875.2		341.2		1,109.3		4,040.5		69.5		16,243.9
Real Estate Finance
Pass		1,075.9		2,089.2		1,212.3		663.5		480.3		493.0		28.1		—		6,042.3		1,075.9		2,089.2		1,212.3		663.5		480.3		493.0		28.1		—		6,042.3
Special Mention		65.9		333.7		126.4		225.5		93.5		46.3		—		—		891.3		65.9		333.7		126.4		225.5		93.5		46.3		—		—		891.3
Classified-accrual		0.3		184.4		124.2		74.6		78.0		75.8		—		—		537.3		0.3		184.4		124.2		74.6		78.0		75.8		—		—		537.3
Classified-non-accrual		—		33.3		0.2		15.3		0.2		28.0		6.2		—		83.2		—		33.3		0.2		15.3		0.2		28.0		6.2		—		83.2
Total Real Estate Finance		1,142.1		2,640.6		1,463.1		978.9		652.0		643.1		34.3		—		7,554.1		1,142.1		2,640.6		1,463.1		978.9		652.0		643.1		34.3		—		7,554.1
Business Capital
Pass		1,678.9		1,371.4		809.5		299.3		106.3		15.6		14.4		0.8		4,296.2		1,678.9		1,371.4		809.5		299.3		106.3		15.6		14.4		0.8		4,296.2
Special Mention		29.6		67.2		42.4		32.4		12.3		0.3		—		—		184.2		29.6		67.2		42.4		32.4		12.3		0.3		—		—		184.2
Classified-accrual		34.3		80.8		71.5		25.9		11.2	��	0.9		—		—		224.6		34.3		80.8		71.5		25.9		11.2		0.9		—		—		224.6
Classified-non-accrual		8.0		33.0		17.1		10.9		2.8		1.0		—		—		72.8		8.0		33.0		17.1		10.9		2.8		1.0		—		—		72.8
Total Business Capital		1,750.8		1,552.4		940.5		368.5		132.6		17.8		14.4		0.8		4,777.8		1,750.8		1,552.4		940.5		368.5		132.6		17.8		14.4		0.8		4,777.8
Rail
Pass		—		0.8		—		0.1		3.1		56.7		—		—		60.7		—		0.8		—		0.1		3.1		56.7		—		—		60.7
Total Rail		—		0.8		—		0.1		3.1		56.7		—		—		60.7		—		0.8		—		0.1		3.1		56.7		—		—		60.7
Total Commercial Banking
Commercial Banking
Pass		7,574.7		5,593.9		4,021.9		1,640.9		770.8		1,310.9		3,371.9		61.9		24,346.9		7,574.7		5,593.9		4,021.9		1,640.9		770.8		1,310.9		3,371.9		61.9		24,346.9
Special Mention		176.7		607.3		379.6		276.3		136.6		166.5		313.3		2.8		2,059.1		176.7		607.3		379.6		276.3		136.6		166.5		313.3		2.8		2,059.1
Classified-accrual		117.0		426.9		245.5		269.7		196.4		259.8		314.2		5.6		1,835.1		117.0		426.9		245.5		269.7		196.4		259.8		314.2		5.6		1,835.1
Classified-non-accrual		8.5		75.3		71.2		35.8		25.1		89.7		89.8		—		395.4		8.5		75.3		71.2		35.8		25.1		89.7		89.8		—		395.4
Total Commercial Banking		7,876.9		6,703.4		4,718.2		2,222.7		1,128.9		1,826.9		4,089.2		70.3		28,636.5		7,876.9		6,703.4		4,718.2		2,222.7		1,128.9		1,826.9		4,089.2		70.3		28,636.5
Consumer Banking - Consumer and Community Banking ⁽²⁾
Pass		507.6		157.1		104.5		62.3		50.0		67.3		0.1		—		948.9		507.6		157.1		104.5		62.3		50.0		67.3		0.1		—		948.9
Special Mention		—		13.1		4.3		2.8		2.6		0.9		—		—		23.7		—		13.1		4.3		2.8		2.6		0.9		—		—		23.7
Classified-accrual		21.0		19.3		17.0		11.0		13.8		17.6		0.3		—		100.0		21.0		19.3		17.0		11.0		13.8		17.6		0.3		—		100.0
Classified-non-accrual		—		11.8		3.0		3.2		1.0		0.8		—		—		19.8		—		11.8		3.0		3.2		1.0		0.8		—		—		19.8
Total Consumer Banking		528.6		201.3		128.8		79.3		67.4		86.6		0.4		—		1,092.4		528.6		201.3		128.8		79.3		67.4		86.6		0.4		—		1,092.4
Commercial Loans
Pass		8,082.3		5,751.0		4,126.4		1,703.2		820.8		1,378.2		3,372.0		61.9		25,295.8		8,082.3		5,751.0		4,126.4		1,703.2		820.8		1,378.2		3,372.0		61.9		25,295.8
Special Mention		176.7		620.4		383.9		279.1		139.2		167.4		313.3		2.8		2,082.8		176.7		620.4		383.9		279.1		139.2		167.4		313.3		2.8		2,082.8
Classified-accrual		138.0		446.2		262.5		280.7		210.2		277.4		314.5		5.6		1,935.1		138.0		446.2		262.5		280.7		210.2		277.4		314.5		5.6		1,935.1
Classified-non-accrual		8.5		87.1		74.2		39.0		26.1		90.5		89.8		—		415.2		8.5		87.1		74.2		39.0		26.1		90.5		89.8		—		415.2
Total Commercial Loans	$	8,405.5	$	6,904.7	$	4,847.0	$	2,302.0	$	1,196.3	$	1,913.5	$	4,089.6	$	70.3	$	29,728.9	$	8,405.5	$	6,904.7	$	4,847.0	$	2,302.0	$	1,196.3	$	1,913.5	$	4,089.6	$	70.3	$	29,728.9

The following table provides a summary of the consumer loan LTV distribution for primarily single-family residential (“SFR”) mortgage loans. The average LTV was 55% and 58% for the total consumer loans included below at June 30, 2021 and December 31, 2020, respectively.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table provides a summary of the consumer loan LTV ~~Distribution~~ ~~(dollars in millions)~~

Term Loans Amortized Cost Basis by Origination Year

Revolving Loans Converted

LTV Range
2021

2020

2019

2018

2017

2016 & Prior

Revolving Loans

to Term Loans

Total ⁽⁴⁾

June 30, 2021

Legacy Consumer Mortgages

Greater than 125%
$
—

$
—

$
—

$
—

$
—

$
19.7

$
—

$
0.2

$
19.9

101% – 125%

—

—

—

—

—

32.9

—

0.4

33.3

80% – 100%

—

—

—

—

—

96.2

—

2.0

98.2

Less than 80%

—

—

—

—

—

1,165.7

—

27.6

1,193.3

Government-guaranteed ⁽¹⁾

—

—

—

—

—

19.5

—

—

19.5

No LTV available ⁽²⁾

—

—

—

—

—

0.1

—

1.4

1.5

Total Legacy Consumer Mortgages

—

—

—

—

—

1,334.1

—

31.6

1,365.7

Consumer and Community Banking

Greater than 125%

—

—

—

—

—

—

—

—

—

101% – 125%

—

—

—

—

—

—

—

—

—

80% – 100%

6.7

1.2

1.3

—

—

—

—

—

9.2

Less than 80%

803.7

1,086.5

560.9

273.5

329.1

860.8

31.4

—

3,945.9

Government-guaranteed ⁽¹⁾

—

10.3

26.2

12.1

53.8

13.6

—

—

116.0

No LTV available ⁽²⁾

—

0.1

—

0.2

0.2

1.4

1.3

—

3.2

No LTV required ⁽³⁾

0.5

2.0

1.0

0.9

0.6

13.4

2.3

—

20.7

Total Consumer and Community Banking

810.9

1,100.1

589.4

286.7

383.7

889.2

35.0

—

4,095.0

Total Consumer Loans
$
810.9

$
1,100.1

$
589.4

$
286.7

$
383.7

$
2,223.3

$
35.0

$
31.6

$
5,460.7

Term Loans Amortized Cost Basis by Origination Year

Revolving Loans Converted

LTV Range
2020

2019

2018

2017

2016

2015 & Prior

Revolving Loans

to Term Loans

Total ⁽⁴⁾

December 31, 2020

Legacy Consumer Mortgages

Greater than 125%
$
—

$
—

$
—

$
—

$
—

$
37.5

$
—

$
0.4

$
37.9

101% – 125%

—

—

—

—

—

60.5

—

1.1

61.6

80% – 100%

—

—

—

—

—

189.2

—

3.4

192.6

Less than 80%

—

—

—

—

—

1,344.3

—

34.7

1,379.0

Government-guaranteed ⁽¹⁾

—

—

—

—

—

20.8

—

—

20.8

No LTV available ⁽²⁾

—

—

—

—

—

0.1

—

1.7

1.8

Total Legacy Consumer Mortgages

—

—

—

—

—

1,652.4

—

41.3

1,693.7

Consumer and Community Banking

Greater than 125%

—

—

—

—

—

—

—

—

—

101% – 125%

—

—

—

—

—

—

—

—

—

80% – 100%

21.3

17.1

3.5

—

—

1.7

2.4

—

46.0

Less than 80%

1,328.4

1,022.7

445.8

507.2

380.1

778.8

41.5

—

4,504.5

Government-guaranteed ⁽¹⁾

12.0

33.7

15.7

68.2

9.5

7.8

—

—

146.9

No LTV available ⁽²⁾

—

—

0.2

0.2

0.2

0.7

1.3

—

2.6

No LTV required ⁽³⁾

2.0

1.0

1.0

0.6

1.0

13.4

3.0

—

22.0

Total Consumer and Community Banking

1,363.7

1,074.5

466.2

576.2

390.8

802.4

48.2

—

4,722.0

Total Consumer Loans
$
1,363.7

$
1,074.5

$
466.2

$
576.2

$
390.8

$
2,454.8

$
48.2

$
41.3

$
6,415.7

⁽¹⁾ ~~Represents~~distribution for primarily single-family residential (“SFR”) mortgage loans. The average LTV was 53% and 58% for the total consumer loans ~~with principal repayments insured by the FHA and U.S. Department of Veterans Affairs (“VA”).~~

⁽²⁾~~Represents primarily junior lien loans for which LTV is not available.~~

⁽³⁾~~Represents overdrafts, personal lines of credit, unsecured loans and third-party guaranteed loans with servicer recourse option for which LTV is not required.~~

⁽⁴⁾~~Amortized cost excludes accrued interest receivable of $15.2 million and $19.0 million~~included below at ~~June~~September 30, 2021 and December 31, 2020, ~~respectively, that~~respectively.

	Term Loans Amortized Cost Basis by Origination Year														Revolving Loans Converted
LTV Range	2021		2020		2019		2018		2017		2016 & Prior		Revolving Loans		to Term Loans		Total
September 30, 2021
Legacy Consumer Mortgages
Greater than 125%	$	—	$	—	$	—	$	—	$	—	$	16.1	$	—	$	0.1	$	16.2
101% – 125%		—		—		—		—		—		22.6		—		0.3		22.9
80% – 100%		—		—		—		—		—		64.5		—		1.1		65.6
Less than 80%		—		—		—		—		—		1,051.1		—		25.5		1,076.6
Government-guaranteed ⁽²⁾		—		—		—		—		—		19.4		—		—		19.4
No LTV available ⁽³⁾		—		—		—		—		—		0.1		—		1.2		1.3
Total Legacy Consumer Mortgages		—		—		—		—		—		1,173.8		—		28.2		1,202.0
Consumer and Community Banking
Greater than 125%		—		—		—		—		—		—		—		—		—
101% – 125%		—		—		—		—		—		—		—		—		—
80% – 100%		11.5		—		0.9		0.8		—		0.8		—		—		14.0
Less than 80%		1,247.4		946.0		453.6		226.8		287.7		757.0		25.4		—		3,943.9
Government-guaranteed ⁽²⁾		—		10.0		22.5		10.3		46.6		13.0		—		—		102.4
No LTV available ⁽³⁾		—		0.1		0.1		0.1		0.1		1.0		1.3		—		2.7
No LTV required ⁽⁴⁾		0.8		2.2		1.0		0.8		0.7		13.0		2.2		—		20.7
Total Consumer and Community Banking		1,259.7		958.3		478.1		238.8		335.1		784.8		28.9		—		4,083.7
Total Consumer Loans	$	1,259.7	$	958.3	$	478.1	$	238.8	$	335.1	$	1,958.6	$	28.9	$	28.2	$	5,285.7

	Term Loans Amortized Cost Basis by Origination Year														Revolving Loans Converted
LTV Range	2020		2019		2018		2017		2016		2015 & Prior		Revolving Loans		to Term Loans		Total
December 31, 2020
Legacy Consumer Mortgages
Greater than 125%	$	—	$	—	$	—	$	—	$	—	$	37.5	$	—	$	0.4	$	37.9
101% – 125%		—		—		—		—		—		60.5		—		1.1		61.6
80% – 100%		—		—		—		—		—		189.2		—		3.4		192.6
Less than 80%		—		—		—		—		—		1,344.3		—		34.7		1,379.0
Government-guaranteed ⁽²⁾		—		—		—		—		—		20.8		—		—		20.8
No LTV available ⁽³⁾		—		—		—		—		—		0.1		—		1.7		1.8
Total Legacy Consumer Mortgages		—		—		—		—		—		1,652.4		—		41.3		1,693.7
Consumer and Community Banking
Greater than 125%		—		—		—		—		—		—		—		—		—
101% – 125%		—		—		—		—		—		—		—		—		—
80% – 100%		21.3		17.1		3.5		—		—		1.7		2.4		—		46.0
Less than 80%		1,328.4		1,022.7		445.8		507.2		380.1		778.8		41.5		—		4,504.5
Government-guaranteed ⁽²⁾		12.0		33.7		15.7		68.2		9.5		7.8		—		—		146.9
No LTV available ⁽³⁾		—		—		0.2		0.2		0.2		0.7		1.3		—		2.6
No LTV required ⁽⁴⁾		2.0		1.0		1.0		0.6		1.0		13.4		3.0		—		22.0
Total Consumer and Community Banking		1,363.7		1,074.5		466.2		576.2		390.8		802.4		48.2		—		4,722.0
Total Consumer Loans	$	1,363.7	$	1,074.5	$	466.2	$	576.2	$	390.8	$	2,454.8	$	48.2	$	41.3	$	6,415.7

The following table provides a summary of the most current FICO score distribution for consumer loans by origination year and

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

~~The following table provides a summary of the FICO score distribution for consumer loans by origination year and~~ revolving loans. The average FICO score was ~~761~~764 and 755 for the total consumer loans included below at ~~June~~September 30, 2021 and December 31, 2020, respectively.

	Term Loans Amortized Cost Basis by Origination Year														Revolving Loans Converted				Term Loans Amortized Cost Basis by Origination Year														Revolving Loans Converted
Current FICO	2021		2020		2019		2018		2017		2016 & Prior		Revolving Loans		to Term Loans		Total ⁽⁴⁾		2021		2020		2019		2018		2017		2016 & Prior		Revolving Loans		to Term Loans		Total
June 30, 2021
September 30, 2021
Legacy Consumer Mortgages
Greater than or equal to 730	$	—	$	—	$	—	$	—	$	—	$	666.4	$	—	$	14.8	$	681.2	$	—	$	—	$	—	$	—	$	—	$	607.6	$	—	$	13.2	$	620.8
Greater than or equal to 660 and less than 730		—		—		—		—		—		387.9		—		9.3		397.2		—		—		—		—		—		347.5		—		8.1		355.6
Less than 660		—		—		—		—		—		233.6		—		6.7		240.3		—		—		—		—		—		173.4		—		6.2		179.6
Government-guaranteed ⁽¹⁾		—		—		—		—		—		19.5		—		—		19.5
No FICO score available ⁽²⁾		—		—		—		—		—		26.7		—		0.8		27.5
Government-guaranteed ⁽²⁾																				—		—		—		—		—		19.4		—		—		19.4
No FICO score available ⁽³⁾																				—		—		—		—		—		25.9		—		0.7		26.6
FICO score not required ⁽⁴⁾																				—		—		—		—		—		—		—		—		—
Total Legacy Consumer Mortgages		—		—		—		—		—		1,334.1		—		31.6		1,365.7		—		—		—		—		—		1,173.8		—		28.2		1,202.0
Consumer and Community Banking
Greater than or equal to 730		690.0		937.9		477.8		220.4		300.7		702.9		24.5		—		3,354.2		1,068.6		810.8		392.2		188.1		260.4		614.0		19.3		—		3,353.4
Greater than or equal to 660 and less than 730		117.4		138.0		78.2		45.3		23.5		100.7		7.0		—		510.1		182.2		122.8		58.9		33.0		22.4		101.2		6.2		—		526.7
Less than 660		3.0		11.2		6.5		6.9		4.9		45.3		2.8		—		80.6		8.1		12.3		3.7		5.6		4.8		30.4		2.8		—		67.7
Government-guaranteed ⁽¹⁾		—		10.3		26.2		12.2		53.8		13.5		—		—		116.0
No FICO score available ⁽²⁾		—		0.7		-		1.0		0.2		13.5		0.2		—		15.6
FICO score not required ⁽³⁾		0.5		2.0		0.7		0.9		0.6		13.3		0.5		—		18.5
Government-guaranteed ⁽²⁾																				—		10.0		22.5		10.3		46.6		13.0		—		—		102.4
No FICO score available ⁽³⁾																				—		0.2		—		1.0		0.2		13.6		0.2		—		15.2
FICO score not required ⁽⁴⁾																				0.8		2.2		0.8		0.8		0.7		12.6		0.4		—		18.3
Total Consumer and Community Banking		810.9		1,100.1		589.4		286.7		383.7		889.2		35.0		—		4,095.0		1,259.7		958.3		478.1		238.8		335.1		784.8		28.9		—		4,083.7
Total Consumer Loans	$	810.9	$	1,100.1	$	589.4	$	286.7	$	383.7	$	2,223.3	$	35.0	$	31.6	$	5,460.7	$	1,259.7	$	958.3	$	478.1	$	238.8	$	335.1	$	1,958.6	$	28.9	$	28.2	$	5,285.7
	Term Loans Amortized Cost Basis by Origination Year														Revolving Loans Converted
Current FICO	2020		2019		2018		2017		2016		2015 & Prior		Revolving Loans		to Term Loans		Total ⁽⁴⁾
December 31, 2020
Legacy Consumer Mortgages
Greater than or equal to 730	$	—	$	—	$	—	$	—	$	—	$	729.1	$	—	$	17.9	$	747.0
Greater than or equal to 660 and less than 730		—		—		—		—		—		499.3		—		13.0		512.3
Less than 660		—		—		—		—		—		369.4		—		9.4		378.8
Government-guaranteed ⁽¹⁾		—		—		—		—		—		20.8		—		—		20.8
No FICO score available ⁽²⁾		—		—		—		—		—		33.8		—		1.0		34.8
Total Legacy Consumer Mortgages		—		—		—		—		—		1,652.4		—		41.3		1,693.7
Consumer and Community Banking
Greater than or equal to 730		1,152.3		923.7		372.3		453.5		339.7		596.7		34.2		—		3,872.4
Greater than or equal to 660 and less than 730		186.3		104.7		68.7		46.3		34.5		125.6		10.0		—		576.1
Less than 660		11.0		11.2		8.4		7.3		5.5		40.8		3.1		—		87.3
Government-guaranteed ⁽¹⁾		12.0		33.7		15.7		68.2		9.5		7.8		—		—		146.9
No FICO score available ⁽²⁾		0.1		0.5		0.1		0.3		0.6		18.2		0.2		—		20.0
FICO score not required ⁽³⁾		2.0		0.7		1.0		0.6		1.0		13.3		0.7		—		19.3
Total Consumer and Community Banking		1,363.7		1,074.5		466.2		576.2		390.8		802.4		48.2		—		4,722.0
Total Consumer Loans	$	1,363.7	$	1,074.5	$	466.2	$	576.2	$	390.8	$	2,454.8	$	48.2	$	41.3	$	6,415.7

⁽¹⁾ ~~Represents loans with principal repayments insured by the FHA and VA.~~

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

~~As of June 30, 2021 and December 31, 2020, there was 0 remaining amount of negative amortization on consumer loans with terms that allowed negative amortization.~~

Additional information on reporting of past due and non-accrual loans is provided in the discussion of the CARES Act and Interagency Statement in Note 1 – Business and Summary of Significant Accounting Policies. Related to loan modifications made in response to the COVID-19 pandemic, the loan maintains the borrower’s delinquency status that existed prior to entering the payment deferral period and is frozen for the duration of the payment deferral period as no contractual payments are due.

The table that follows presents portfolio delinquency status, regardless of accrual or non-accrual classification:

	Past Due						Total						Past Due						Total
	30-59		60-89		90 or more		Past Due		Current		Total		30-59		60-89		90 or more		Past Due		Current		Total
June 30, 2021
September 30, 2021
Commercial Banking
Commercial Finance	$	29.7	$	1.5	$	135.2	$	166.4	$	15,803.5	$	15,969.9	$	37.2	$	8.9	$	29.8	$	75.9	$	16,023.3	$	16,099.2
Real Estate Finance		0.9		33.8		7.3		42.0		6,530.6		6,572.6		0.2		10.6		9.2		20.0		6,410.8		6,430.8
Business Capital		51.3		27.3		20.7		99.3		4,561.5		4,660.8		58.5		26.4		17.3		102.2		4,521.2		4,623.4
Rail		-		-		-		-		62.6		62.6		—		—		—		—		63.7		63.7
Total Commercial Banking		81.9		62.6		163.2		307.7		26,958.2		27,265.9		95.9		45.9		56.3		198.1		27,019.0		27,217.1
Consumer Banking
Legacy Consumer Mortgage		31.2		10.7		44.7		86.6		1,279.1		1,365.7		24.1		4.7		25.2		54.0		1,148.1		1,202.1
Consumer and Community Banking		55.5		8.7		34.2		98.4		4,981.1		5,079.5		42.7		26.7		20.2		89.6		4,952.2		5,041.8
Total Consumer Banking		86.7		19.4		78.9		185.0		6,260.2		6,445.2		66.8		31.4		45.4		143.6		6,100.3		6,243.9
Total	$	168.6	$	82.0	$	242.1	$	492.7	$	33,218.4	$	33,711.1	$	162.7	$	77.3	$	101.7	$	341.7	$	33,119.3	$	33,461.0
December 31, 2020
Commercial Banking
Commercial Finance	$	59.9	$	2.8	$	122.0	$	184.7	$	16,059.2	$	16,243.9	$	59.9	$	2.8	$	122.0	$	184.7	$	16,059.2	$	16,243.9
Real Estate Finance		71.7		38.3		82.4		192.4		7,361.7		7,554.1		71.7		38.3		82.4		192.4		7,361.7		7,554.1
Business Capital		113.6		40.2		16.6		170.4		4,607.4		4,777.8		113.6		40.2		16.6		170.4		4,607.4		4,777.8
Rail		-		-		-		-		60.7		60.7		—		—		—		—		60.7		60.7
Total Commercial Banking		245.2		81.3		221.0		547.5		28,089.0		28,636.5		245.2		81.3		221.0		547.5		28,089.0		28,636.5
Consumer Banking
Legacy Consumer Mortgage		61.0		17.6		79.7		158.3		1,535.5		1,693.8		61.0		17.6		79.7		158.3		1,535.5		1,693.8
Consumer and Community Banking		173.1		10.6		34.0		217.7		5,596.6		5,814.3		173.1		10.6		34.0		217.7		5,596.6		5,814.3
Total Consumer Banking		234.1		28.2		113.7		376.0		7,132.1		7,508.1		234.1		28.2		113.7		376.0		7,132.1		7,508.1
Total	$	479.3	$	109.5	$	334.7	$	923.5	$	35,221.1	$	36,144.6	$	479.3	$	109.5	$	334.7	$	923.5	$	35,221.1	$	36,144.6

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table sets forth non-accrual loans, assets received in satisfaction of loans (OREO and repossessed assets) and loans 90 days or more past due and still accruing. Loans that are 90 days or more past due and are guaranteed by government agencies are not placed on non-accrual status. See Note 1 – Business and Summary of Significant Accounting Policies in the 2020 Form 10-K for additional information.

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
	Non-Accrual Loans		With No Allowance Recorded⁽²⁾		Non-Accrual Loans		With No Allowance Recorded⁽²⁾		Non-Accrual Loans		With No Allowance Recorded⁽²⁾		Non-Accrual Loans		With No Allowance Recorded⁽²⁾
Commercial Banking
Commercial Finance⁽³⁾	$	277.6	$	17.1	$	239.4	$	8.0	$	225.3	$	13.4	$	239.4	$	8.0
Business Capital	60.2			2.1		72.8		1.5	40.8			3.1		72.8		1.5
Real Estate Finance	79.3			15.8		83.2		16.0	63.4			2.6		83.2		16.0
Total Commercial Banking		417.1		35.0		395.4		25.5		329.5		19.1		395.4		25.5
Consumer Banking
Consumer and Community Banking		73.1		50.3		53.4		38.2		52.1		29.5		53.4		38.2
Legacy Consumer Mortgages		58.8		15.5		139.3		30.0		23.3		5.9		139.3		30.0
Total Consumer Banking		131.9		65.8		192.7		68.2		75.4		35.4		192.7		68.2
Total	$	549.0	$	100.8	$	588.1	$	93.7	$	404.9	$	54.5	$	588.1	$	93.7
Repossessed assets and OREO⁽⁴⁾		8.7			7.9					10.5				7.9
Total non-performing assets	$	557.7			$	596.0			$	415.4			$	596.0

Commercial loans past due 90 days or more accruing	$ 80.6				$ 92.5				$	14.7			$	92.5
Consumer loans past due 90 days or more accruing		13.7			11.3
Consumer loans past due 90 days or more accruing⁽⁵⁾										13.2				11.3
Total accruing loans past due 90 days or more	$	94.3			$	103.8			$	27.9			$	103.8

Payments received on non-accrual loans are generally applied first against outstanding principal, though in certain instances where the remaining recorded investment is deemed fully collectible, interest income is recognized on a cash basis. Interest recorded on non-accrual loans was $0.5 million and ~~$1.2~~$6.9 million for the quarters ended ~~June~~September 30, 2021 and 2020, respectively, and ~~$1.3~~$1.9 million and ~~$1.6~~$8.5 million for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively.

Loans are in the process of foreclosure when repayment is expected to be provided substantially through the sale of the underlying real estate and the borrower is experiencing financial difficulty. The table below summarizes the residential mortgage loans in the process of foreclosure. Consistent with the government agency guidance, CIT ~~has~~ suspended residential property foreclosures and evictions ~~until at least~~through July 31, 2021 related to single family homeowners due to the COVID-19 pandemic.

The Company periodically modifies the terms of loans in response to borrowers’ difficulties. Modifications that include a financial concession to the borrower are accounted for as TDRs. A restructuring of a debt constitutes a TDR for purposes of ASC 310-40 when CIT, for economic or legal reasons related to the debtor’s financial difficulties, grants a concession to the debtor that it would not otherwise consider. A concession may be either by agreement between CIT and the debtor or imposed by law or a court of law. See Note 1 – Business and Summary of Significant Accounting Policies in the Company's 2020 Form 10-K for discussion of policies on TDRs.

The CARES Act and Interagency Statement offer some practical expedients for evaluating whether loan modifications that occur in response to the COVID-19 pandemic are TDRs. See Note 1 – Business and Summary of Significant Accounting Policies for details. Any loan modification that meets these practical expedients would not automatically be considered a TDR because the borrower is presumed not to be experiencing financial difficulty at the time of the loan modification.

Modified loans that meet the definition of a TDR are subject to the Company's individually reviewed loans policy.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table presents recorded investment of TDRs, excluding those within a trial modification period of ~~$0.5~~$0.1 million at ~~June~~September 30, 2021 and $4.5 million atDecember 31, 2020:

	June 30, 2021						December 31, 2020						September 30, 2021						December 31, 2020
	Recorded Investment			% Total TDR			Recorded Investment			% Total TDR			Recorded Investment			% Total TDR			Recorded Investment			% Total TDR
Commercial Banking	$	82.5			68	%	$	109.8			82	%	$	96.1			74	%	$	109.8			82	%
Consumer Banking		38.2			32	%		24.6			18	%		33.4			26	%		24.6			18	%
Total	$	120.7			100	%	$	134.4			100	%	$	129.5			100	%	$	134.4			100	%
Percent non-accrual		77	%					73	%					51	%					73	%

	Quarters Ended June 30,				Six Months Ended June 30,				Quarters Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020		2021		2020		2021		2020
Recorded investment related to modifications qualifying as TDRs that occurred during the periods	$	9.2	$	15.4	$	21.3	$	55.4	$	31.3	$	10.0	$	48.8	$	62.4
Recorded investment at the time of default of TDRs that experienced a payment default (payment default is one missed payment) during the periods and for which the payment default occurred within one year of the modification	$	3.6	$	6.6	$ 8.4		$ 7.3		$	2.9	$	13.6	12.9		19.9

There were ~~$9.2~~$9.3 million and $28.3 million of commitments to lend additional funds to borrowers whose loan terms have been modified in TDRs as of ~~June~~September 30, 2021 and December 31, 2020, respectively.

Modifications qualifying as TDRs based upon recorded investment at ~~June~~September 30, 2021, were comprised of payment deferrals ~~(45%~~(55%) and covenant relief and/or other ~~(55%~~(45%). At December 31, 2020, TDR recorded investment was comprised of payment deferrals (40%) and covenant relief and/or other (60%). The financial impact of the various modification strategies that the Company employs in response to borrower difficulties is presented below. The overall nature of modification programs were comparable in the prior periods.

The other elements of the Company’s modification programs that are not TDRs do not have a significant impact on financial results given their relative size or do not have a direct financial impact, as in the case of covenant changes.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The ACL and the allowance for off-balance sheet credit exposures are reported on the Condensed Consolidated Balance Sheets in the allowance for credit losses and in other liabilities, respectively. Provision for credit losses related to the ~~loans and leases~~loan portfolio and the off-balance sheet credit exposures are reported in the Consolidated Statements of Operations as provision for credit losses.

Allowance for Credit Losses and Recorded Investment in Loans (dollars in millions)

	Quarter Ended June 30, 2021									Quarter Ended June 30, 2020									Quarter Ended September 30, 2021									Quarter Ended September 30, 2020
	Commercial Banking			Consumer Banking			Total			Commercial Banking			Consumer Banking			Total			Commercial Banking			Consumer Banking			Total			Commercial Banking			Consumer Banking			Total
Balance - beginning of period	$	828.1		$	114.2		$	942.3		$	937.6		$	173.5		$	1,111.1		$	743.4		$	107.2		$	850.6		$	1,020.1		$	182.6		$	1,202.7
Provision for credit losses⁽¹⁾		(66.8	)		(5.4	)		(72.2	)		214.7			8.9			223.6
Other⁽²⁾		6.9			(0.3	)		6.6			37.7			0.1			37.8
Provision for credit losses⁽¹⁾																				(49.3	)		(17.8	)		(67.1	)		87.9			(24.6	)		63.3
Other⁽²⁾																				11.7			0.2			11.9			7.1			(0.9	)		6.2
Gross charge-offs		(45.1	)		(2.3	)		(47.4	)		(193.0	)		(0.5	)		(193.5	)		(15.3	)		(1.1	)		(16.4	)		(77.2	)		(1.0	)		(78.2	)
Recoveries		20.3			1.0			21.3			23.1			0.6			23.7			10.7			0.7			11.4			11.4			0.8			12.2
Balance - end of period	$	743.4		$	107.2		$	850.6		$	1,020.1		$	182.6		$	1,202.7		$	701.2		$	89.2		$	790.4		$	1,049.3		$	156.9		$	1,206.2

	Six Months Ended June 30, 2021									Six Months Ended June 30, 2020									Nine Months Ended September 30, 2021									Nine Months Ended September 30, 2020
Balance - beginning of period	$	933.7		$	130.1		$	1,063.8		$	460.4		$	22.2		$	482.6		$	933.7		$	130.1		$	1,063.8		$	460.4		$	22.2		$	482.6
CECL adoption⁽³⁾		-			-			-			74.7			148.9			223.6
Provision for credit losses⁽¹⁾		(171.3	)		(18.3	)		(189.6	)		723.6			13.9			737.5
Initial ACL recognized on PCD assets⁽⁴⁾		-			-			-			18.8			1.4			20.2
Other⁽²⁾		16.5			(0.7	)		15.8			(35.7	)		(2.1	)		(37.8	)
Gross charge-offs		(70.9	)		(5.4	)		(76.3	)		(253.8	)		(2.7	)		(256.5	)
CECL adoption⁽³⁾																				-			-			-			74.7			148.9			223.6
Provision for credit losses⁽¹⁾																				(220.6	)		(36.1	)		(256.7	)		811.5			(10.7	)		800.8
Initial ACL recognized on PCD assets⁽⁴⁾																				-			-			-			18.8			1.4			20.2
Other⁽²⁾																				28.2			(0.5	)		27.7			(28.6	)		(3.0	)		(31.6	)
Gross charge-offs⁽⁴⁾																				(86.2	)		(6.5	)		(92.7	)		(331.0	)		(3.7	)		(334.7	)
Recoveries		35.4			1.5			36.9			32.1			1.0			33.1			46.1			2.2			48.3			43.5			1.8			45.3
Balance - end of period	$	743.4		$	107.2		$	850.6		$	1,020.1		$	182.6		$	1,202.7		$	701.2		$	89.2		$	790.4		$	1,049.3		$	156.9		$	1,206.2

	June 30, 2021									December 31, 2020									September 30, 2021									December 31, 2020
	Commercial Banking			Consumer Banking			Total			Commercial Banking			Consumer Banking			Total			Commercial Banking			Consumer Banking			Total			Commercial Banking			Consumer Banking			Total
Allowance Balance
Loans individually evaluated for impairment	$	87.6		$	4.1		$	91.7		$	100.8		$	5.5		$	106.3		$	68.2		$	4.1		$	72.3		$	100.8		$	5.5		$	106.3
Loans collectively evaluated for impairment		655.8			103.1			758.9			832.9			124.6			957.5			633.0			85.1			718.1			832.9			124.6			957.5
Allowance for credit losses		743.4			107.2			850.6			933.7			130.1			1,063.8		$	701.2		$	89.2		$	790.4		$	933.7		$	130.1		$	1,063.8
Allowance for off-balance sheet credit exposures	$	60.3		$	1.5		$	61.8		$	76.8		$	1.5		$	78.3		$	48.6		$	1.5		$	50.1		$	76.8		$	1.5		$	78.3
Loans
Loans individually evaluated for impairment	$	362.3		$	81.0		$	443.3		$	346.3		$	86.4		$	432.7		$	289.1		$	53.1		$	342.2		$	346.3		$	86.4		$	432.7
Loans collectively evaluated for impairment		26,903.6			6,364.2			33,267.8			28,290.2			7,421.7			35,711.9			26,928.0			6,190.8			33,118.8			28,290.2			7,421.7			35,711.9
Ending balance	$	27,265.9		$	6,445.2		$	33,711.1		$	28,636.5		$	7,508.1		$	36,144.6		$	27,217.1		$	6,243.9		$	33,461.0		$	28,636.5		$	7,508.1		$	36,144.6
Percent of loans to total loans		80.9	%		19.1	%		100.0	%		79.2	%		20.8	%		100.0	%		81.3	%		18.7	%		100.0	%		79.2	%		20.8	%		100.0	%

The ACL was ~~$850.6~~$790.4 million as of ~~June~~September 30, 2021, compared to $1,063.8 million at December 31, 2020. The lower ACL balance drove a benefit for credit losses of ~~$(72.2)~~$(67.1) million and ~~$(189.6)~~$(256.7) million for the quarter and ~~six~~nine months ended ~~June~~September 30, 2021, respectively, compared to a provision of ~~$223.6~~$63.3 million and ~~$737.5~~$800.8 million for the quarter and ~~six~~nine months ended ~~June~~September 30, 2020, respectively. The allowance for off-balance sheet credit exposures decreased from $78.3 million at December 31, 2020 to ~~$61.8~~$50.1 million at ~~June~~September 30, 2021.

Changes in the ACL and allowance for off-balance sheet credit exposures compared to the prior year periods reflect lower loan balances and off-balance sheet credit exposures, as well as an improvement in the macroeconomic scenario forecasts and credit loss trends ~~partially offset by net charge-offs~~. The year-ago ACL and provision reflected the estimated impact of the COVID-19 pandemic on the economy and market environment across our portfolio, along with the adoption of the CECL standard and the impact of the MOB Acquisition on January 1, 2020.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

CIT leases primarily include office space and bank branches, and substantially all of our lease liabilities relate to United States real estate leases under operating lease arrangements. Our lessee finance leases are not significant. Our real estate leases have remaining lease terms of up to 15 years. Our lease terms may include options to extend or terminate the lease. The options are considered in the accounting when it is determined that it is reasonably certain the option will be exercised.

The following tables present supplemental balance sheet and cash flow information related to operating leases. Right of use (“ROU”) assets are included in other assets and lease liabilities are included in other liabilities.

	June 30,		December 31,		September 30,		December 31,
	2021		2020		2021		2020
ROU assets	$	259.3	$	198.8	$	252.7	$	198.8
Lease liabilities		296.4		249.9		288.4		249.9

	Six Months Ended June 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Cash paid for amounts included in the measurement of lease liabilities	$	26.0	$	28.2	$	37.4	$	42.6
ROU assets obtained in exchange for new lease liabilities		68.1		12.6		68.9		16.4

A 15-year lease commenced in April 2021 for office space in Morristown, NJ, which is primarily occupied by corporate functional staff. At ~~June~~September 30, 2021, ROU assets and lease liabilities for the lease are ~~$73.0~~$71.9 and ~~$62.6~~$61.7 million, respectively.

The Company leases equipment to commercial end-users under operating lease and finance lease arrangements. The majority of operating lease equipment is long-lived rail equipment which is typically leased several times over the equipment’s life. We also lease technology and office equipment and large and small ticket industrial, medical, and transportation equipment under both operating leases and finance leases.

Our Rail operating leases typically do not include purchase options. Many of our finance leases, and other equipment operating leases, offer the lessee the option to purchase the equipment at fair market value or for a nominal fixed purchase ~~option;~~option, and many of the leases that do not have a nominal purchase option include renewal provisions resulting in some leases continuing beyond initial contractual term. Our leases typically do not include early termination options; and continued rent payments are due if leased equipment is not returned at the end of the lease.

The table that follows presents lease income related to the Company’s operating and finance leases:

	Quarters Ended June 30,				Six Months Ended June 30,				Quarters Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020		2021		2020		2021		2020
Lease income – Operating leases	$	177.5	$	189.0	$	356.6	$	386.8	$	173.9	$	191.4	$	530.5	$	578.2
Variable lease income – Operating leases ⁽¹⁾		10.7		11.9		26.3		23.9		12.3		9.9		38.6		33.8
Rental income on operating leases		188.2		200.9		382.9		410.7		186.2		201.3		569.1		612.0
Interest income - Sales type and direct financing leases		42.3		39.5		86.4		83.2		39.5		44.3		125.9		127.5
Variable lease income included in Other non-interest income ⁽²⁾		10.6		10.9		21.3		21.8		10.4		9.9		31.7		31.7
Leveraged lease income		3.5		2.6		6.8		5.2		3.7		3.1		10.5		8.3
Total lease income	$	244.6	$	253.9	$	497.4	$	520.9	$	239.8	$	258.6	$	737.2	$	779.5

⁽¹⁾ Primarily includes per diem railcar operating lease rental income earned on a time or mileage usage basis.

⁽²⁾ Includes revenue related to insurance coverage on Business Capital leased equipment of ~~$6.7~~$6.8 million and ~~$6.1~~$5.9 million for the quarters ended ~~June~~September 30, 2021 and 2020, respectively, and ~~$13.3~~$20.1 million and ~~$12.4~~$18.3 million for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively, as well as revenue related to leased equipment property tax reimbursements due from customers of ~~$3.9~~$3.5 million and ~~$4.8~~$4.0 million for the quarters ended ~~June~~September 30, 2021 and 2020, respectively, and ~~$8.0~~$11.5 million and ~~$9.4~~$13.4 million for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

Investment securities include debt and equity securities. See Note 1 — Business and Summary of Significant Accounting Policies in the Company’s 2020 Form 10-K for information on accounting for investment securities. The following table presents carrying value of investment securities.

	June 30,		December 31,		September 30,		December 31,
	2021		2020		2021		2020
Available-for-sale Securities
Available-for-sale securities
Debt securities	$	5,081.5	$	6,673.5	$	5,561.1	$	6,673.5
Non-marketable securities⁽¹⁾		214.3		215.5		214.1		215.5
Total investment securities	$	5,295.8	$	6,889.0	$	5,775.2	$	6,889.0

Accrued interest receivable on debt securities totaled ~~$9.1~~$7.6 million and $13.7 million as of ~~June~~September 30, 2021 and December 31, 2020, respectively, and were included in other ~~assets on the Consolidated Balance Sheet.~~assets.

The Company had ~~$5.1~~$4.4 billion and $3.8 billion of interest-bearing cash at banks at ~~June~~September 30, 2021 and December 31, 2020, respectively, which are cash and cash equivalents and presented separately on the ~~balance sheet.~~Consolidated Balance Sheet.

The following table presents interest and dividends on investments and interest-bearing cash.

	Quarters Ended June 30,				Six Months Ended June 30,				Quarters Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020		2021		2020		2021		2020
Interest income - debt securities⁽¹⁾	$	14.8	$	26.9	$	35.9	$	66.1	$	15.0	$	24.0	$	50.9	$	90.1
Interest income - interest-bearing cash		1.5		1.8		2.8		7.4		2.0		2.1		4.8		9.5
Dividends - equity securities		1.1		1.0		2.8		2.2		0.9		1.4		3.7		3.6
Total interest and dividends	$	17.4	$	29.7	$	41.5	$	75.7	$	17.9	$	27.5	$	59.4	$	103.2

The following table presents proceeds from sales of debt securities AFS and realized gains (losses) included in earnings at the time of sales. The ~~six~~nine months ended ~~June~~September 30, 2021 included the impact of management’s strategic decision to monetize gains on certain AFS securities (primarily mortgage-backed securities (“MBS”)) previously included in accumulated other comprehensive income (“AOCI”). See Changes in Accumulated Other Comprehensive Income (Loss) by Component table in Note 11 – Stockholders’ Equity.

Realized Gains (Losses) and Proceeds from Sales of Debt Securities AFS (dollars in millions)

	Quarters Ended June 30,						Six Months Ended June 30,						Quarters Ended September 30,					Nine Months Ended September 30,
	2021			2020			2021			2020			2021		2020			2021			2020
Proceeds from sales of debt securities AFS	$	143.1		$	461.3		$	2,619.8		$	2,461.8		$	271.4	$	314.2		$	2,891.2		$	2,776.1
Gross realized gains	$	3.6		$	8.0		$	108.3		$	22.0		$	5.5	$	8.4		$	113.8		$	30.5
Gross realized losses		(0.5	)		(0.1	)		(0.5	)		(1.6	)		—		(0.2	)		(0.5	)		(1.9	)
Net realized gains on sales of securities available-for-sale	$	3.1		$	7.9		$	107.8		$	20.4
Net realized gains on sales of debt securities AFS													$	5.5	$	8.2		$	113.3		$	28.6

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

	Amortized Cost⁽¹⁾		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Amortized Cost⁽¹⁾		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
June 30, 2021
September 30, 2021
Debt securities AFS
Mortgage-backed securities
U.S. government/sponsored agency – Residential	$	1,091.7	$	2.8	$	(14.9	)	$	1,079.6	$	1,596.6	$	0.5	$	(21.6	)	$	1,575.5
U.S. government/sponsored agency – Commercial		1,790.8		2.0		(20.3	)		1,772.5		1,742.2		0		(28.6	)		1,713.6
U.S. government/sponsored agency obligations		1,444.3		0		(22.2	)		1,422.1		1,509.9		0		(22.8	)		1,487.1
U.S. Treasury securities		506.2		0		(16.5	)		489.7		506.3		0		(17.8	)		488.5
Supranational securities		330.2		0		(12.6	)		317.6		309.9		0		(13.5	)		296.4
Total debt securities AFS	$	5,163.2	$	4.8	$	(86.5	)	$	5,081.5	$	5,664.9	$	0.5	$	(104.3	)	$	5,561.1

December 31, 2020
Debt securities AFS
Mortgage-backed securities
U.S. government/sponsored agency – Residential	$	2,503.4	$	76.5	$	(0.1	)	$	2,579.8	$	2,503.4	$	76.5	$	(0.1	)	$	2,579.8
U.S. government/sponsored agency – Commercial		1,725.0		56.3		(0.5	)		1,780.8		1,725.0		56.3		(0.5	)		1,780.8
U.S. government/sponsored agency obligations		1,474.2		0.5		(3.9	)		1,470.8		1,474.2		0.5		(3.9	)		1,470.8
U.S. Treasury securities		505.9		0		(3.2	)		502.7		505.9		0		(3.2	)		502.7
Supranational securities		330.2		0.2		(2.9	)		327.5		330.2		0.2		(2.9	)		327.5
Agency asset-backed securities		1.5		0.1		0			1.6		1.5		0.1		0			1.6
Corporate bonds - foreign		10.3		0		0			10.3		10.3		0		0			10.3
Total debt securities AFS	$	6,550.5	$	133.6	$	(10.6	)	$	6,673.5	$	6,550.5	$	133.6	$	(10.6	)	$	6,673.5

The following table presents the debt securities AFS by contractual maturity dates.

	June 30, 2021							September 30, 2021
	Amortized Cost		Fair Value		Weighted Average Yield			Amortized Cost		Fair Value		Weighted Average Yield
Mortgage-backed securities — U.S. government/sponsored agency – Residential
After 5 through 10 years	$	0.1	$	0.1		6.32	%	$	0.1	$	0.1		5.21	%
After 10 years		1,091.6		1,079.5		1.61	%		1,596.5		1,575.4		1.68	%
Total		1,091.7		1,079.6		1.61	%		1,596.6		1,575.5		1.68	%
Mortgage-backed securities — U.S. government/sponsored agency – Commercial
After 5 through 10 years		55.3		55.5		1.90	%		31.2		30.1		1.12	%
After 10 years		1,735.5		1,717.0		1.46	%		1,711.0		1,683.5		1.45	%
Total		1,790.8		1,772.5		1.47	%		1,742.2		1,713.6		1.45	%
U.S. government/sponsored agency obligations
After 1 through 5 years		232.6		231.0		0.60	%		532.5		528.0		0.66	%
After 5 through 10 years		1,211.7		1,191.1		1.10	%		977.4		959.1		1.13	%
Total		1,444.3		1,422.1		1.02	%		1,509.9		1,487.1		0.96	%
U.S. Treasury securities
1 year or less		13.0		13.1		0.22	%		13.0		13.1		0.23	%
After 1 through 5 years		99.9		98.1		0.27	%		99.9		98.1		0.27	%
After 5 through 10 years		393.3		378.5		0.50	%		393.4		377.3		0.50	%
Total		506.2		489.7		0.45	%		506.3		488.5		0.45	%
Supranational securities
1 year or less		20.4		20.4		0.15	%		—		—		0.00	%
After 1 through 5 years		56.9		56.3		0.47	%		56.9		56.2		0.47	%
After 5 through 10 years		252.9		240.9		0.85	%		253.0		240.2		0.85	%
Total		330.2		317.6		0.74	%		309.9		296.4		0.78	%
Total debt securities AFS	$	5,163.2	$	5,081.5		1.23	%	$	5,664.9	$	5,561.1		1.26	%

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

December 31, 2020, certain securities AFS were in unrealized loss positions. The following table summarizes by investment category the gross unrealized losses, respective fair value and length of time that those securities have been in a continuous unrealized loss position for which an ACL has not been recorded.

	June 30, 2021									September 30, 2021
	Less than 12 months					12 months or greater				Less than 12 months					12 months or greater
	Fair Value		Gross Unrealized Loss			Fair Value		Gross Unrealized Loss		Fair Value		Gross Unrealized Loss			Fair Value		Gross Unrealized Loss
Debt securities AFS
Mortgage-backed securities
U.S. government/sponsored agency - Residential	$	804.8	$	(14.9	)	$	0	$	0	$	1,511.3	$	(21.6	)	$	0	$	0
U.S. government/sponsored agency - Commercial		1,564.1		(20.3	)		0		0		1,594.1		(26.9	)		42.2		(1.7	)
U.S. government/sponsored agency obligations		1,287.1		(22.2	)		0		0		1,324.7		(21.7	)		87.4		(1.1	)
U.S. Treasury securities		479.7		(16.5	)		0		0		434.1		(15.7	)		47.8		(2.1	)
Supranational securities		297.2		(12.6	)		0		0		187.5		(8.0	)		108.8		(5.5	)
Total debt securities AFS	$	4,432.9	$	(86.5	)	$	0	$	0	$	5,051.7	$	(93.9	)	$	286.2	$	(10.4	)

There were 0 impairment losses on debt securities AFS for the quarter ended ~~June~~September 30, 2021. There was a $0.4 million impairment loss on debt securities AFS for the ~~six~~nine months ended ~~June~~September 30, 2021. There were 0 impairment losses recognized for the quarter and ~~six~~nine months ended ~~June~~September 30, 2020.

There were noinsignificant adjustments for non-marketable securities without readily determinable fair values ~~measured under the~~

~~measurement alternative~~ for the ~~quarters~~quarter and ~~six~~nine months ended ~~June~~September 30, 2021, and no adjustments for the quarter and nine months ended September 30, 2020.

There was no ACL relating to investment securities as of ~~June~~September 30, 2021 and December 31, 2020, primarily due to the high proportion of U.S. government guaranteed securities in the portfolio.

There were insignificant unrealized gains and losses on non-marketable securities as of ~~June~~September 30, 2021 and December 31, 2020.

Securities with a carrying value of ~~$874.7~~$136.2 million and $1,926.2 million were pledged as of ~~June~~September 30, 2021 and December 31, 2020, respectively, to secure FHLB financing availability and mortgage programs, public funds in CIT Bank, derivative contracts, and for other purposes as required or permitted by law.

Described below are the results of the Company’s assessment of its variable interests in order to determine its current status with regard to being the VIE primary beneficiary (“PB”). See Note 1 — Business and Summary of Significant Accounting Policies in the 2020 Form 10-K for additional information on accounting for VIEs.

At ~~June~~September 30, 2021 and December 31, 2020, there were 0 consolidated VIEs.

Unconsolidated VIEs include agency and non-agency securitization structures, limited partnership interests and joint ventures where the Company’s involvement is limited to an investor interest and the Company does not have the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance or obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The table below presents potential losses that would be incurred under hypothetical circumstances, such that the value of its interests and any associated collateral declines to zero and assuming no recovery or offset from any economic hedges. The Company believes the possibility is remote under this hypothetical scenario; accordingly, this ~~required~~ disclosure is not an indication of expected loss.

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
	Securities		Other Investments		Securities		Other Investments		Securities		Other Investments		Securities		Other Investments
Agency securities	$	2,852.1	$	—	$	4,362.2	$	—	$	3,289.1	$	—	$	4,362.2	$	—
Tax credit equity investments		—		360.3		—		311.5		—		366.6		—		311.5
Equity investments		—		142.6		—		111.9		—		146.6		—		111.9
Total assets	$	2,852.1	$	502.9	$	4,362.2	$	423.4	$	3,289.1	$	513.2	$	4,362.2	$	423.4
Commitments to tax credit investments⁽¹⁾	$	—	$	202.7	$	—	$	168.3	$	—	$	195.7	$	—	$	168.3
Total liabilities	$	—	$	202.7	$	—	$	168.3	$	—	$	195.7	$	—	$	168.3
Maximum loss exposure	$	2,852.1	$	502.9	$	4,362.2	$	423.4	$	3,289.1	$	513.2	$	4,362.2	$	423.4

	June 30, 2021						December 31, 2020		September 30, 2021						December 31, 2020
	CIT Group Inc.		Subsidiaries		Total		Total		CIT Group Inc.		Subsidiaries		Total		Total
Unsecured borrowings:
Senior	$	3,425.4	$	313.2	$	3,738.6	$	4,236.3	$	3,427.0	$	313.3	$	3,740.3	$	4,236.3
Subordinated notes		495.2		-		495.2		494.9		495.3		—		495.3		494.9
Secured borrowings:
FHLB advances		-		-		-		1,100.0		—		—		—		1,100.0
Other secured and structured financings		-		10.3		10.3		6.1		—		12.0		12.0		6.1
Total borrowings	$	3,920.6	$	323.5	$	4,244.1	$	5,837.3	$	3,922.3	$	325.3	$	4,247.6	$	5,837.3

The Revolving Credit Facility had a total commitment amount of $300 million at ~~June~~September 30, 2021 and December 31, ~~2020. The facility has~~2020, consisting of a ~~final maturity date~~$200 million revolving loan tranche and a $100 million revolving loan tranche that could also be utilized for issuance of ~~November 1,~~letters of credit. At September 30, 2021, ~~and~~the Revolving Credit Facility had a Tier 1 capital ratio requirement of 8.5%, and ~~the~~ applicable margin charged under the facility isof 1.75% for loans indexed to LIBOR and 0.75% for loans related to other indexes, as defined in the credit agreement.

At ~~June~~September 30, 2021, the Revolving Credit Facility was unsecured and guaranteed by 3 of the Company’s domestic operating subsidiaries. In addition, the applicable required minimum guarantor asset coverage ratio could range from 1.0:1.0 to 1.5:1.0 based on CIT’s credit ratings and was 1.25:1.00 at ~~June~~September 30, 2021.

The ~~RevolvingCredit Facility may be drawn, prepaid~~facility matured on November 1, 2021 and redrawn at the option of CIT. The unutilized portion of any commitment under the Revolving Credit Facility may be reduced permanently or terminated by CIT at any time without penalty. The $300 million total commitment amount consists of a $200 million revolving loan tranche and a $100 million revolving loan tranche that can also be utilized for issuance of letters of credit. At June 30, 2021, approximately $14 million was ~~utilized for CIT’s issuances of letters of credit.~~not renewed.

On February 9, 2021, wethe Company redeemed all of the aggregate principal amount ($500 million) of outstanding 4.125% Senior Notes due March 2021 at par. There were no other significant changes from December 31, 2020. See Note 10 – Borrowings in the 2020 Form 10-K.

The principal amounts and maturity dates of the subordinated unsecured notes remained unchanged from December 31, 2020. See Note 10 – Borrowings in the 2020 Form 10-K.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

At ~~June~~September 30, 2021, the Company had pledged ~~$12.4~~$11.9 billion of assets to several financing facilities (including collateral for the FRB discount window that is currently not drawn) which included ~~$11.6~~$11.9 billion of loans and ~~$0.7 billion~~$28 million of ~~investment securities.~~cash. Under the FHLB Facility, CIT Bank, N.A. may at any time grant a security interest in, sell, convey or otherwise dispose of any of the assets used for collateral, provided that CIT Bank, N.A. is in compliance with the collateral maintenance requirement immediately following such disposition and all other requirements of the facility at the time of such disposition.

The following table presents the FHLB balances as of ~~June~~September 30, 2021 and December 31, 2020.

							December 31,
	June 30, 2021						2020			September 30,		December 31,
	Lending Assets		High Quality Liquid Securities		Total		Total			2021		2020
Total borrowing capacity	$	5,319.7	$	714.8	$	6,034.5	$	7,175.3		$	5,391.4	$	7,175.3
Less:
Advances		—		—		—		(1,100.0	)		—		(1,100.0	)
Available capacity	$	5,319.7	$	714.8	$	6,034.5	$	6,075.3		$	5,391.4	$	6,075.3
Pledged assets ⁽¹⁾	$	6,887.8	$	744.7	$	7,632.5	$	8,868.0		$	7,023.0	$	8,868.0
Weighted Average Rate						N/A		0.82	%	N/A			0.82	%

Other secured (other than FHLB) and structured financings of CIT-owned subsidiaries totaled ~~$10.3~~$12.0 million and $6.1 million at ~~June~~September 30, 2021 and December 31, 2020, respectively. Pledged assets related to these financings, primarily the ABL facility, totaled ~~$2,128.1~~$2,478.0 million and $2,486.4 million at ~~June~~September 30, 2021 and December 31, 2020, respectively. The outstanding secured and structured financings as of ~~June~~September 30, 2021 had a weighted average rate of ~~4.35%~~4.33%, compared to a weighted average rate of 4.39% at December 31, 2020.

There were 0 outstanding borrowings ~~with~~from the FRB Discount Window at ~~June~~September 30, 2021 and December 31, 2020.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

See Derivative Financial Instruments and Recent Accounting Pronouncements sections in Note 1 — Business and Summary of Significant Accounting Policies in the Company’s 2020 Form 10-K for a description of the Company’s derivative products and transaction policies.

The following table presents notional amount and fair value of derivative financial instruments on a gross basis.

Notional Amount and Fair Value of Derivative Financial Instruments (dollars in millions)

	June 30, 2021								December 31, 2020								September 30, 2021								December 31, 2020
	Notional Amount		Asset Fair Value			Liability Fair Value			Notional Amount		Asset Fair Value			Liability Fair Value			Notional Amount		Asset Fair Value			Liability Fair Value			Notional Amount		Asset Fair Value			Liability Fair Value
Derivatives designated as hedging instruments (Qualifying hedges)
Foreign exchange contracts	$	36.0	$	0.2		$	(0.2	)	$	33.9	$	-		$	(0.3	)	$	2.6	$	—		$	—		$	33.9	$	—		$	(0.3	)
Interest rate contracts⁽¹⁾⁽³⁾		-		-			-			500.0		-			-			—		—			—			500.0		—			—
Total derivatives designated as hedging instruments		36.0		0.2			(0.2	)		533.9		-			(0.3	)		2.6		—			—			533.9		—			(0.3	)
Derivatives not designated as hedging instruments (Non-qualifying hedges)
Interest rate contracts⁽¹⁾⁽³⁾		20,930.9		297.8			(69.0	)		21,192.9		429.6			(72.2	)		20,948.6		263.9			(74.7	)		21,192.9		429.6			(72.2	)
Foreign exchange contracts		184.8		3.9			(1.9	)		247.8		1.7			(6.0	)		205.9		4.5			(2.6	)		247.8		1.7			(6.0	)
Other contracts⁽²⁾		913.3		0.2			(0.6	)		875.8		0.3			(0.7	)		909.5		0.1			(0.6	)		875.8		0.3			(0.7	)
Total derivatives not designated as hedging instruments		22,029.0		301.9			(71.5	)		22,316.5		431.6			(78.9	)		22,064.0		268.5			(77.9	)		22,316.5		431.6			(78.9	)
Gross derivatives fair values presented in the Consolidated Balance Sheets	$	22,065.0	$	302.1		$	(71.7	)	$	22,850.4	$	431.6		$	(79.2	)	$	22,066.6	$	268.5		$	(77.9	)	$	22,850.4	$	431.6		$	(79.2	)
Less: Gross amounts offset in the Consolidated Balance Sheets				-			-					-			-					—			—					—			—
Net amount presented in the Consolidated Balance Sheet				302.1			(71.7	)				431.6			(79.2	)				268.5			(77.9	)				431.6			(79.2	)
Less: Amounts subject to master netting agreements⁽⁴⁾				(11.0	)		11.0					(4.7	)		4.7					(10.8	)		10.8					(4.7	)		4.7
Less: Cash collateral pledged (received) subject to master netting agreements⁽⁵⁾				(0.3	)		20.5					-			42.9					(0.9	)		18.3					—			42.9
Total net derivative fair value			$	290.8		$	(40.2	)			$	426.9		$	(31.6	)			$	256.8		$	(48.8	)			$	426.9		$	(31.6	)

CIT enters into interest rate swap agreements to manage interest rate exposure on its fixed-rate borrowings. The agreements that qualify for hedge accounting are designated as fair value hedges. The following table represents gains (losses) of fair value hedges recognized as interest ~~expense on the condensed consolidated statements of operations.~~expense.

	Quarters Ended June 30,					Six Months Ended June 30,						Quarters Ended September 30,					Nine Months Ended September 30,
	2021		2020			2021			2020			2021		2020			2021			2020
Recognized on derivatives⁽¹⁾	$	-	$	(1.2	)	$	(1.1	)	$	4.9		$	—	$	(2.3	)	$	(1.1	)	$	2.6
Recognized on hedged item		-		1.2			1.1			(4.9	)		—		2.3			1.1			(2.6	)
Net recognized on fair value hedges (No ineffectiveness)	$	-	$	-		$	-		$	-
Net recognized on fair value hedges (no ineffectiveness)												$	—	$	—		$	—		$	—

⁽¹⁾ Gains (losses) exclude amounts related to interest settlements on derivatives.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table presents the carrying value of hedged items and associated cumulative hedging adjustment related to fair value hedges.

			Cumulative Fair Value Hedging Adjustment Included in the Carrying Value of Hedged Items						Cumulative Fair Value Hedging Adjustment Included in the Carrying Value of Hedged Items
	Carrying Value of Hedged Items⁽¹⁾		Currently Designated		No Longer Designated		Carrying Value of Hedged Items⁽¹⁾		Currently Designated		No Longer Designated
June 30, 2021
September 30, 2021
Long-term Debt	$	784.3	$	-	$	1.5	$	784.4	$	—	$	1.4
December 31, 2020
Long-term Debt	$	1,534.4	$	1.1	$	1.8	$	1,534.4	$	1.1	$	1.8

The following table presents the pre-tax net gains (losses) recorded in the condensed consolidated statements of operations and in the condensed consolidated statements of comprehensive income (loss) relating to derivatives designated as net investment hedges.

Pre-tax Net Gains (Losses) Relating to Derivatives Designated as Net Investment Hedges (dollars in millions)

			Amounts								Amounts
	Amounts		recorded in Other						Amounts		Recorded in Other
	reclassified from		Comprehensive			Total change in			Reclassified from		Comprehensive			Total Change in
	AOCI to income		Income			AOCI for period			AOCI to Income		Income (Loss)			AOCI for Period
Contract Type
Quarter Ended June 30, 2021
Quarter Ended September 30, 2021
Foreign currency forward contracts - net investment hedges	$	-	$	(0.5	)	$	(0.5	)	$	13.5	$	0.2		$	13.7
Quarter Ended June 30, 2020
Quarter Ended September 30, 2020
Foreign currency forward contracts - net investment hedges	$	-	$	(0.5	)	$	(0.5	)	$	—	$	(1.6	)	$	(1.6	)
Six Months Ended June 30, 2021
Nine Months Ended September 30, 2021
Foreign currency forward contracts - net investment hedges	$	-	$	(0.5	)	$	(0.5	)	$	13.5	$	(0.3	)	$	13.2
Six Months Ended June 30, 2020
Nine Months Ended September 30, 2020
Foreign currency forward contracts - net investment hedges	$	-	$	0.5		$	0.5		$	—	$	(1.1	)	$	(1.1	)

The following table presents gains (losses) of non-qualifying hedges recognized as other non-interest ~~income on the condensed consolidated statements of operations.~~income.

	Quarters Ended June 30,						Six Months Ended June 30,						Quarters Ended September 30,					Nine Months Ended September 30,
	2021			2020			2021			2020			2021		2020			2021			2020
Interest rate contracts	$	1.6		$	6.6		$	8.2		$	6.6		$	3.1	$	5.1		$	11.3		$	11.7
Foreign currency forward contracts		(2.2	)		(8.5	)		1.3			2.4			2.1		(6.1	)		3.4			(3.7	)
Other contracts		0.1			1.5			(0.1	)		(0.9	)		—		0.2			(0.1	)		(0.7	)
Total non-qualifying hedges - income statement impact	$	(0.5	)	$	(0.4	)	$	9.4		$	8.1		$	5.2	$	(0.8	)	$	14.6		$	7.3

The Company measures certain financial assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP also establishes a fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three levels. See Note 1 — Business and Summary of Significant Accounting Policies in the Company's 2020 Form 10-K for a description of its valuation process for assets and liabilities measured at fair value and the fair value hierarchy.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table summarizes the Company’s assets and liabilities measured at estimated fair value on a recurring basis.

Assets and Liabilities Measured at Fair Value on a Recurring Basis (dollars in millions)

	Total			Level 1		Level 2			Level 3			Total			Level 1		Level 2			Level 3
June 30, 2021
September 30, 2021
Assets
U.S. government/sponsored agency – Residential MBS	$	1,079.6		$	—	$	1,079.6		$	—		$	1,575.5		$	—	$	1,575.5		$	—
U.S. government/sponsored agency – Commercial MBS		1,772.5			—		1,772.5			—			1,713.6			—		1,713.6			—
U.S. government/sponsored agency obligations		1,422.1			—		1,422.1			—			1,487.1			—		1,487.1			—
U.S. Treasury securities		489.7			8.1		481.6			—			488.5			8.1		480.4			—
Supranational securities		317.6			—		317.6			—			296.4			—		296.4			—
Total debt securities AFS		5,081.5			8.1		5,073.4			—			5,561.1			8.1		5,553.0			—

Interest rate contracts — non-qualifying hedges		297.8			—		297.4			0.4			263.9			—		263.7			0.2
Other derivative — non-qualifying hedges		4.1			—		3.9			0.2			4.6			—		4.4			0.2
Total derivative assets at fair value — non-qualifying hedges⁽¹⁾		301.9			—		301.3			0.6			268.5			—		268.1			0.4
Foreign currency forward contracts — net investment qualifying hedges		0.2			—		0.2			—			—			—		—			—
Total Derivative assets at fair value — qualifying hedges		0.2			—		0.2			—
Total derivative assets at fair value — qualifying hedges													—			—		—			—
Total	$	5,383.6		$	8.1	$	5,374.9		$	0.6		$	5,829.6		$	8.1	$	5,821.1		$	0.4
Liabilities
Interest rate contracts — non-qualifying hedges	$	(69.0	)	$	—	$	(69.0	)	$	—		$	(74.7	)	$	—	$	(74.7	)	$	—
Other derivative— non-qualifying hedges		(2.5	)		—		(1.9	)		(0.6	)		(3.2	)		—		(2.6	)		(0.6	)
Total derivative liabilities at fair value — non-qualifying hedges⁽¹⁾		(71.5	)		—		(70.9	)		(0.6	)		(77.9	)		—		(77.3	)		(0.6	)
Foreign currency forward contracts — net investment qualifying hedges		(0.2	)		—		(0.2	)		—			—			—		—			—
Total derivative liabilities at fair value — qualifying hedges		(0.2	)		—		(0.2	)		—			—			—		—			—
Total	$	(71.7	)	$	—	$	(71.1	)	$	(0.6	)	$	(77.9	)	$	—	$	(77.3	)	$	(0.6	)
December 31, 2020
Assets
U.S. government/sponsored agency – Residential MBS	$	2,579.8		$	—	$	2,579.8		$	—		$	2,579.8		$	—	$	2,579.8		$	—
U.S. government/sponsored agency – Commercial MBS		1,780.8			—		1,780.8			—			1,780.8			—		1,780.8			—
U.S. government/sponsored agency obligations		1,470.8			—		1,470.8			—			1,470.8			—		1,470.8			—
U.S. Treasury securities		502.7			7.8		494.9			—			502.7			7.8		494.9			—
Supranational securities		327.5			—		327.5			—			327.5			—		327.5			—
Other securities		11.9			—		1.6			10.3			11.9			—		1.6			10.3
Total debt securities AFS		6,673.5			7.8		6,655.4			10.3			6,673.5			7.8		6,655.4			10.3

Interest rate contracts — non-qualifying hedges		429.6			—		428.1			1.5			429.6			—		428.1			1.5
Other derivative — non-qualifying hedges		2.0			—		1.7			0.3			2.0			—		1.7			0.3
Total derivative assets at fair value — non-qualifying hedges⁽¹⁾		431.6			—		429.8			1.8			431.6			—		429.8			1.8
Total	$	7,105.1		$	7.8	$	7,085.2		$	12.1		$	7,105.1		$	7.8	$	7,085.2		$	12.1
Liabilities
Interest rate contracts — non-qualifying hedges	$	(72.2	)	$	—	$	(72.2	)	$	—		$	(72.2	)	$	—	$	(72.2	)	$	—
Other derivative— non-qualifying hedges		(6.7	)		—		(6.0	)		(0.7	)		(6.7	)		—		(6.0	)		(0.7	)
Total derivative liabilities at fair value — non-qualifying hedges⁽¹⁾		(78.9	)		—		(78.2	)		(0.7	)		(78.9	)		—		(78.2	)		(0.7	)
Foreign currency forward contracts — net investment qualifying hedges		(0.3	)		—		(0.3	)		—			(0.3	)		—		(0.3	)		—
Total derivative liabilities at fair value — qualifying hedges		(0.3	)		—		(0.3	)		—			(0.3	)		—		(0.3	)		—
Total	$	(79.2	)	$	—	$	(78.5	)	$	(0.7	)	$	(79.2	)	$	—	$	(78.5	)	$	(0.7	)

The methods and assumptions used to estimate the fair value of each class of financial instruments measured at fair value on a recurring basis are as follows:

Debt securities AFS — Investments in U.S. government agency and sponsored agency guaranteed mortgage-backed securities, U.S. government agency and sponsored agency obligations, U.S. Treasury securities and supranational securities were valued using Level 2 inputs. The market for certain corporate bonds is not active, therefore the estimated fair value was determined using a discounted cash flow technique or other appropriate techniques. Given the lack of observable market data, the estimated fair value of the corporate bonds was classified as Level 3. All of the corporate bonds were sold in the second quarter of 2021.

Derivative Assets and Liabilities — Derivatives were valued using models that incorporate inputs depending on the type of derivative. ~~Besides~~Other than the fair value of credit derivatives, which were estimated using Level 3 inputs, most derivative instruments were valued using Level 2 inputs based on quoted prices for similar assets and liabilities and model-based valuation techniques for which all significant assumptions are observable in the market. See Note 9 — Derivative Financial Instruments for notional principal amounts and fair values.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The following tables summarize information about significant unobservable inputs related to the Company’s categories of Level 3 financial assets and liabilities measured on a recurring basis.

Quantitative Information about Level 3 Fair Value Measurements — Recurring (dollars in millions)

Financial Instrument	Estimated Fair Value			Valuation Technique(s)	Significant Unobservable Inputs	Range of Inputs	Weighted Average	Estimated Fair Value			Valuation Technique(s)	Significant Unobservable Inputs	Range of Inputs	Weighted Average
June 30, 2021
September 30, 2021
Assets
Derivative assets — non qualifying	$	0.6		Internal valuation model	Borrower Rate	2.0% - 3.6%	2.9%	$	0.4		Internal valuation model	Borrower Rate	1.8% - 4.1%	2.7%
Total Assets	$	0.6						$	0.4
Liabilities
Derivative liabilities — non-qualifying	$	(0.6	)	Internal valuation model				$	(0.6	)	Internal valuation model
Total Liabilities	$	(0.6	)					$	(0.6	)
December 31, 2020
Assets
Debt Securities — AFS	$	10.3		Discounted cash flow	Discount Rate	8.5% - 10.4%	9.5%	$	10.3		Discounted cash flow	Discount Rate	8.5% - 10.4%	9.5%
Derivative assets — non qualifying		1.8		Internal valuation model	Borrower Rate	1.9% - 3.6%	2.7%		1.8		Internal valuation model	Borrower Rate	1.9% - 3.6%	2.7%
Total Assets	$	12.1						$	12.1
Liabilities
Derivative liabilities — non-qualifying	$	(0.7	)	Internal valuation model				$	(0.7	)	Internal valuation model
Total Liabilities	$	(0.7	)					$	(0.7	)

The following table summarizes the changes in estimated fair value for all assets and liabilities measured at estimated fair value on a recurring basis using significant unobservable inputs (Level 3).

Changes in Estimated Fair Value of Level 3 Financial Assets and Liabilities Measured on a Recurring Basis (dollars in millions)

	Securities- AFS			Derivative Assets- Non- Qualifying			Derivative Liabilities- Non- Qualifying			FDIC True-up Liability⁽¹⁾			Securities- AFS			Derivative Assets- Non- Qualifying			Derivative Liabilities- Non- Qualifying			FDIC True-up Liability⁽¹⁾
Balance as of December 31, 2020	$	10.3		$	1.8		$	(0.7	)	$	—		$	10.3		$	1.8		$	(0.7	)	$	—
Included in earnings		—			(1.2	)		0.1			—			—			(1.4	)		0.1			—
Included in comprehensive income		—			—			—			—			—			—			—			—
Maturity and settlements		(9.9	)		—			—			—			(9.9	)		—			—			—
Impairment		(0.4	)		—			—			—			(0.4	)		—			—			—
Balance as of June 30, 2021	$	—		$	0.6		$	(0.6	)	$	—
Balance as of September 30, 2021													$	—		$	0.4		$	(0.6	)	$	—
Balance as of December 31, 2019	$	67.1		$	0.3		$	(0.8	)	$	(68.8	)	$	67.1		$	0.3		$	(0.8	)	$	(68.8	)
Included in earnings		(0.3	)		1.7			(0.8	)		(0.2	)		0.1			1.1			(0.4	)		(0.2	)
Included in comprehensive income		(1.3	)		—			—			—			(1.1	)		—			—			—
Maturity and settlements		(13.0	)		—			—			69.0			(26.7	)		—			—			69.0
Balance as of June 30, 2020	$	52.5		$	2.0		$	(1.6	)	$	—
Balance as of September 30, 2020													$	39.4		$	1.4		$	(1.2	)	$	—

Certain assets or liabilities are required to be measured at estimated fair value on a non-recurring basis subsequent to initial recognition. Generally, these adjustments are the result of ~~LOCOM~~lower of cost or market or other impairment accounting.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table presents carrying value of assets measured at estimated fair value on a non-recurring basis for which gains and losses from a non-recurring fair value adjustment have been recorded in the periods. The gains and losses reflect amounts for the respective year-to-date periods.

	Fair Value Measurements											Fair Value Measurements
	Total		Level 1		Level 2		Level 3		Total Gains (Losses)			Total		Level 1		Level 2		Level 3		Total Gains (Losses)
June 30, 2021
September 30, 2021
Assets held for sale												$	37.4	$	—	$	6.5	$	30.9	$	(4.7	)
Loans	$	107.1	$	—	$	—	$	107.1	$	(19.5	)		96.2		—		—		96.2		(20.7	)
Total	$	107.1	$	—	$	—	$	107.1	$	(19.5	)	$	133.6	$	—	$	6.5	$	127.1	$	(25.4	)
December 31, 2020
Assets held for sale	$	701.6	$	0	$	0	$	701.6	$	(112.7	)	$	701.6	$	0	$	0	$	701.6	$	(112.7	)
Loans		106.4		—		—		106.4		(55.6	)		106.4		—		—		106.4		(55.6	)
Mortgage servicing rights		4.3		—		—		4.3		(4.5	)		4.3		—		—		4.3		(4.5	)
ROU assets		4.4		—		—		4.4		(6.1	)		4.4		—		—		4.4		(6.1	)
Total	$	816.7	$	0	$	0	$	816.7	$	(178.9	)	$	816.7	$	0	$	0	$	816.7	$	(178.9	)

The methods and assumptions used to estimate the fair value of each class of financial instruments measured at fair value on a non-recurring basis are as follows:

Assets Held for Sale — The fair value of Level 2 assets was primarily estimated based on prices of recent trades of similar assets. The fair value of Level 3 assets was primarily ~~valued~~measured under the income approach using the discounted cash flow model based on ~~level~~Level 3 inputs including discount rate or ~~valued based on~~the price of executed or committed trades.

Loans — Loans that are collateral-dependent were measured based on the fair value of the underlying collateral less costs to sell. These loans are classified as Level 3 as the fair value of underlying collateral is estimated primarily based on third party

appraisals or opinions adjusted for the Company’s experience with liquidation value.

Mortgage Servicing Rights — Under the amortization method, the carrying value of the MSRs was reduced to its fair value ~~for~~by

the impairment loss recognized. The fair value of the MSRs was ~~valued~~measured under the income approach using the discounted cash

flow model based on ~~level~~Level 3 inputs including prepayment speed, discount rates and cost to service.

ROU Assets — During 2020, the Company recognized an impairment loss on ROU assets for certain leased facilities. The fair

value of ROU assets was measured based on the discounted cash flows of estimated rental income for the office space to be

subleased, using market participant assumptions. As unobservable inputs are used, ROU assets are classified as Level 3. See

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The carrying values and estimated fair values of financial instruments not measured at fair value presented below exclude finance leases and operating lease equipment, and certain other assets and liabilities, which were not required for disclosure.

				Estimated Fair Value														Estimated Fair Value
	Carrying Value			Level 1		Level 2			Level 3			Total			Carrying Value			Level 1		Level 2			Level 3			Total
June 30, 2021
September 30, 2021
Financial Assets
Cash and interest-bearing deposits	$	5,280.7		$	5,280.7	$	—		$	—		$	5,280.7
Assets held for sale (excluding leases)		50.8			—		18.6			33.3			51.9
Loans (excluding leases)⁽¹⁾		30,706.3			—		1,404.4			30,098.4			31,502.8
Cash and interest bearing deposits															$	4,598.4		$	4,598.4	$	—		$	—		$	4,598.4
Assets held for sale																92.2			—		13.1			79.2			92.3
Loans⁽¹⁾																30,582.8			—		1,520.4			29,723.5			31,243.9
Securities purchased under agreements to resell		150.0			—		150.0			—			150.0			100.0			—		100.0			—			100.0
Investment securities⁽²⁾		214.3			—		—			214.3			214.3			214.1			—		—			214.1			214.1
Financial Liabilities
Deposits⁽³⁾		(41,283.1	)		—		—			(41,387.2	)		(41,387.2	)		(40,249.0	)		—		—			(40,337.4	)		(40,337.4	)
Borrowings⁽³⁾		(4,311.2	)		—		(4,694.5	)		(11.3	)		(4,705.8	)		(4,276.7	)		—		(4,611.6	)		(12.6	)		(4,624.2	)
Credit balances of factoring clients		(1,530.5	)		—		—			(1,530.5	)		(1,530.5	)		(1,556.6	)		—		—			(1,556.6	)		(1,556.6	)
December 31, 2020
Financial Assets
Cash and interest-bearing deposits	$	4,011.7		$	4,011.7	$	—		$	—		$	4,011.7
Assets held for sale (excluding leases)		720.0			—		14.5			706.2			720.7
Loans (excluding leases)⁽¹⁾		32,812.9			—		1,332.1			32,285.4			33,617.5
Cash and interest bearing deposits															$	4,011.7		$	4,011.7	$	—		$	—		$	4,011.7
Assets held for sale																720.0			—		14.5			706.2			720.7
Loans⁽¹⁾																32,812.9			—		1,332.1			32,285.4			33,617.5
Securities purchased under agreement to resell		150.0			—		150.0			—			150.0			150.0			—		150.0			—			150.0
Investment securities⁽²⁾		215.5			—		—			215.5			215.5			215.5			—		—			215.5			215.5
Financial Liabilities
Deposits⁽³⁾		(43,086.0	)		—		—			(43,224.0	)		(43,224.0	)		(43,086.0	)		—		—			(43,224.0	)		(43,224.0	)
Borrowings⁽³⁾		(5,911.1	)		—		(6,371.3	)		(8.0	)		(6,379.3	)		(5,911.1	)		—		(6,371.3	)		(8.0	)		(6,379.3	)
Credit balances of factoring clients		(1,719.9	)		—		—			(1,719.9	)		(1,719.9	)		(1,719.9	)		—		—			(1,719.9	)		(1,719.9	)

The methods and assumptions used to estimate the fair value of each class of financial instruments not measured at fair value are as follows:

Assets Held for Sale — The fair value of Level 2 assets was primarily estimated based on the prices of recent trades of similar assets.

Loans — Loans are generally valued by discounting expected cash flows using market inputs with adjustments based on cohort level assumptions for certain loan types as well as internally developed estimates at a division or portfolio level. Due to the significance of the unobservable market inputs and assumptions, as well as the absence of a liquid secondary market for most loans, these loans are classified as Level 3. Certain loans are measured based on observable market prices sourced from external data providers and classified as Level 2. Nonaccrual loans are written down and reported at their estimated recovery value which approximates their fair value and classified as Level 3.

Securities Purchased Under Agreement to Resell — The fair value of securities purchased under agreement to resell (reverse repo) was determined using a discount cash flow technique. Interest rates appropriate to the maturity and underlying collateral are used for discounting the estimated cash flows. As observable market interest rates are used, the fair value of securities purchased under agreement to resell was classified as Level 2.

Investment Securities–non-marketable — Utilize Level 3 inputs to estimate fair value and were generally recorded under the measurement alternative. FHLB and FRB stock carrying values approximate fair value. Of the remaining non-marketable securities, the fair value is determined based on techniques that use significant assumptions that are not observable in the market.

Deposits — The estimated fair value of deposits with no stated maturity, such as demand deposit accounts, money market accounts, and savings accounts was the amount payable on demand at the reporting date. The fair value of time deposits was estimated based on a discounted cash flow technique using Level 3 inputs appropriate to the contractual maturity.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

Credit balances of factoring clients — The impact of the time value of money from the unobservable discount rate for credit balances of factoring clients is inconsequential due to the short term nature of these balances, therefore, the carrying value approximated fair value, and the credit balances were classified as Level 3.

	Issued		Less Treasury			Outstanding			Issued		Less Treasury			Outstanding
Common stock - December 31, 2020		163,309,861		(64,700,466	)		98,609,395			163,309,861		(64,700,466	)		98,609,395
Restricted stock issued		757,277		-			757,277			768,318		—			768,318
Shares held to cover taxes on vesting restricted shares and other		-		(262,488	)		(262,488	)		—		(266,668	)		(266,668	)
Employee stock purchase plan participation		39,161		-			39,161			55,978		—			55,978
Common stock - June 30, 2021		164,106,299		(64,962,954	)		99,143,345
Common stock - September 30, 2021										164,134,157		(64,967,134	)		99,167,023

Components of Accumulated Other Comprehensive Income (Loss) (dollars in millions)

	June 30, 2021									December 31, 2020									September 30, 2021									December 31, 2020
	Gross Unrealized			Income Taxes			Net Unrealized			Gross Unrealized			Income Taxes			Net Unrealized			Gross Unrealized			Income Taxes			Net Unrealized			Gross Unrealized			Income Taxes			Net Unrealized
Foreign currency translation adjustments	$	(2.9	)	$	(6.3	)	$	(9.2	)	$	(2.6	)	$	(6.5	)	$	(9.1	)	$	10.2		$	(9.1	)	$	1.1		$	(2.6	)	$	(6.5	)	$	(9.1	)
Changes in benefit plans net loss and prior service (cost)/credit		(41.6	)		(3.8	)		(45.4	)		(42.5	)		(3.6	)		(46.1	)		(41.2	)		(3.8	)		(45.0	)		(42.5	)		(3.6	)		(46.1	)
Net (loss) gains on securities AFS		(81.7	)		20.9			(60.8	)		123.0			(32.1	)		90.9
Unrealized net (loss) gains on securities AFS																				(103.8	)		26.5			(77.3	)		123.0			(32.1	)		90.9
Total accumulated other comprehensive (loss) income	$	(126.2	)	$	10.8		$	(115.4	)	$	77.9		$	(42.2	)	$	35.7		$	(134.8	)	$	13.6		$	(121.2	)	$	77.9		$	(42.2	)	$	35.7

The following table details the changes in the components of AOCI, net of income taxes:

Changes in Accumulated Other Comprehensive Income (Loss) by Component (dollars in millions)

				Changes in												Changes in
				benefit plan												Benefit Plan
	Foreign			net (loss) gain			Unrealized net						Foreign			Net (Loss) Gain			Unrealized Net
	currency			and prior			gains (losses)						Currency			and Prior			(Losses) Gains
	translation			service (cost)			on AFS						Translation			Service (Cost)			on AFS
	adjustments			credit			securities			Total AOCI			Adjustments			Credit			Securities			Total AOCI
Balance as of December 31, 2020	$	(9.1	)	$	(46.1	)	$	90.9		$	35.7		$	(9.1	)	$	(46.1	)	$	90.9		$	35.7
AOCI activity before reclassifications		(0.1	)		0.2			(71.4	)		(71.3	)		(0.4	)		0.3			(83.8	)		(83.9	)
Amounts reclassified from AOCI		-			0.5			(80.3	)		(79.8	)		10.6			0.8			(84.4	)		(73.0	)
Net current period AOCI		(0.1	)		0.7			(151.7	)		(151.1	)
Balance as of June 30, 2021	$	(9.2	)	$	(45.4	)	$	(60.8	)	$	(115.4	)
Net current period changes in AOCI														10.2			1.1			(168.2	)		(156.9	)
Balance as of September 30, 2021													$	1.1		$	(45.0	)	$	(77.3	)	$	(121.2	)

Balance as of December 31, 2019	$	(9.1	)	$	(52.6	)	$	9.6		$	(52.1	)	$	(9.1	)	$	(52.6	)	$	9.6		$	(52.1	)
AOCI activity before reclassifications		(1.0	)		2.6			131.2			132.8			(0.4	)		2.7			117.2			119.5
Amounts reclassified from AOCI		-			0.3			(15.2	)		(14.9	)		-			0.3			(21.3	)		(21.0	)
Net current period AOCI		(1.0	)		2.9			116.0			117.9
Balance as of June 30, 2020	$	(10.1	)	$	(49.7	)	$	125.6		$	65.8
Net current period changes in AOCI														(0.4	)		3.0			95.9			98.5
Balance as of September 30, 2020													$	(9.5	)	$	(49.6	)	$	105.5		$	46.4

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The amounts included in the Condensed Consolidated Statements of Comprehensive Income (Loss) are net of income taxes. The following table presents the pretax and after-tax components of other comprehensive income.

Quarters Ended June 30,	2021									2020
Quarters Ended September 30,																				2021									2020
																			Income																			Income
	Gross						Net			Gross						Net			Statement	Gross						Net			Gross						Net			Statement
	Amount			Tax			Amount			Amount			Tax			Amount			Line Item	Amount			Tax			Amount			Amount			Tax			Amount			Line Item
Foreign currency translation adjustments losses
Foreign currency translation adjustments
AOCI activity before reclassification	$	(0.2	)	$	0.2		$	-		$	(0.3	)	$	0.2		$	(0.1	)		$	(0.1	)	$	(0.2	)	$	(0.3	)	$	0.3		$	0.3		$	0.6
Reclassifications out of AOCI																					13.2			(2.6	)		10.6			—			—			—		Other non- interest income
Net Change		(0.2	)		0.2			-			(0.3	)		0.2			(0.1	)			13.1			(2.8	)		10.3			0.3			0.3			0.6

Changes in benefit plan net gain (loss) and prior service (cost) credit losses
AOCI activity before reclassification		0.2			-			0.2			(0.1	)		0.1			-				—			0.1			0.1			0.1			—			0.1
Reclassifications out of AOCI		0.3			(0.1	)		0.2			0.2			(0.1	)		0.1		Operating expenses		0.4			(0.1	)		0.3			—			—			—		Operating expenses
Net Change		0.5			(0.1	)		0.4			0.1			-			0.1				0.4			-			0.4			0.1			—			0.1

Unrealized net (losses) gains on securities AFS
AOCI activity before reclassification		47.1			(12.1	)		35.0			6.7			(1.8	)		4.9				(16.6	)		4.2			(12.4	)		(18.9	)		4.9			(14.0	)
Reclassifications out of AOCI		(3.6	)		1.0			(2.6	)		(7.9	)		2.0			(5.9	)	Other non- interest income		(5.5	)		1.4			(4.1	)		(8.2	)		2.1			(6.1	)	Other non- interest income
Net Change		43.5			(11.1	)		32.4			(1.2	)		0.2			(1.0	)			(22.1	)		5.6			(16.5	)		(27.1	)		7.0			(20.1	)
Net current period OCI	$	43.8		$	(11.0	)	$	32.8		$	(1.4	)	$	0.4		$	(1.0	)		$	(8.6	)	$	2.8		$	(5.8	)	$	(26.7	)	$	7.3		$	(19.4	)

Six Months Ended June 30,	2021									2020
Nine Months Ended September 30,																				2021									2020
																			Income																			Income
	Gross						Net			Gross						Net			Statement	Gross						Net			Gross						Net			Statement
	Amount			Tax			Amount			Amount			Tax			Amount			Line Item	Amount			Tax			Amount			Amount			Tax			Amount			Line Item
Foreign currency translation adjustments losses
Foreign currency translation adjustments
AOCI activity before reclassification	$	(0.3	)	$	0.2		$	(0.1	)	$	(0.9	)	$	(0.1	)	$	(1.0	)		$	(0.4	)	$	—		$	(0.4	)	$	(0.6	)	$	0.2		$	(0.4	)
Reclassifications out of AOCI																					13.2			(2.6	)		10.6			—			—			—		Other non- interest income
Net Change		(0.3	)		0.2			(0.1	)		(0.9	)		(0.1	)		(1.0	)			12.8			(2.6	)		10.2			(0.6	)		0.2			(0.4	)

Changes in benefit plan net gain (loss) and prior service (cost) credit losses
AOCI activity before reclassification		0.2			-			0.2			3.5			(0.9	)		2.6				0.2			0.1			0.3			3.6			(0.9	)		2.7
Reclassifications out of AOCI		0.7			(0.2	)		0.5			0.4			(0.1	)		0.3		Operating expenses		1.1			(0.3	)		0.8			0.4			(0.1	)		0.3		Operating expenses
Net Change		0.9			(0.2	)		0.7			3.9			(1.0	)		2.9				1.3			(0.2	)		1.1			4.0			(1.0	)		3.0

Unrealized net gains on securities AFS
Unrealized net (losses) gains on securities AFS
AOCI activity before reclassification		(96.4	)		25.0			(71.4	)		176.4			(45.2	)		131.2				(113.0	)		29.2			(83.8	)		157.5			(40.3	)		117.2
Reclassifications out of AOCI		(108.3	)		28.0			(80.3	)		(20.4	)		5.2			(15.2	)	Other non- interest income		(113.8	)		29.4			(84.4	)		(28.6	)		7.3			(21.3	)	Other non- interest income
Net Change		(204.7	)		53.0			(151.7	)		156.0			(40.0	)		116.0				(226.8	)		58.6			(168.2	)		128.9			(33.0	)		95.9
Net current period OCI	$	(204.1	)	$	53.0		$	(151.1	)	$	159.0		$	(41.1	)	$	117.9			$	(212.7	)	$	55.8		$	(156.9	)	$	132.3		$	(33.8	)	$	98.5

The Company’s global effective income tax rate (“ETR”) was 24.0% for both the quarter and ~~six~~nine months ended ~~June~~September 30, 2021 and ~~46.2%~~25.6% and ~~17.0%~~15.7% for the quarter and ~~six~~nine months ended ~~June~~September 30, 2020, respectively. The decrease from ~~46.2%~~25.6% in the prior year quarter to the ~~24.0 %~~24.0% rate for the quarter ended ~~June~~September 30, 2021 was primarily driven by ~~the impact of the required true-up to the year-to-date provision in the prior year quarter for income taxes resulting from the increase in the annual effective rate quarter over quarter due to~~ the effect that the change in forecasted pre-tax income had on the permanent and other adjustments. The increase from ~~17.0%~~15.7% in the prior year period to the 24.0% rate for the ~~six~~nine months ended ~~June~~September 30, 2021 was primarily due to the impact of the non-deductible portion of the goodwill impairment in the prior year.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

The quarterly income tax expense was based on a projection of the Company’s annual ~~effective tax rate.~~ETR. This annual ETR was applied to the year-to-date consolidated pre-tax income to determine the interim provision for income taxes before discrete items. The ETR each period was also impacted by a number of factors, including discrete items, the relative mix of domestic and international earnings, effects of changes infrom enacted tax laws, and adjustments to the valuation ~~allowances, and discrete items.~~allowances. The currently forecasted ETR may vary from the actual year-end 2021 ETR due to the changes in these factors.

The Company recognizes tax benefits when it is more likely than not that the position will prevail, based solely on the technical merits under the tax law of the relevant jurisdiction. The Company recognizes the tax benefit if the position meets this recognition threshold determined based on the largest amount of the benefit that is more than likely to be realized.

The accompanying table summarizes credit-related commitments and other purchase and funding commitments:

	June 30, 2021						December 31, 2020		September 30, 2021						December 31, 2020
	Due to Expire								Due to Expire
	Within One Year		After One Year		Total Outstanding		Total Outstanding		Within One Year		After One Year		Total Outstanding		Total Outstanding
Financing Commitments
Financing assets (excluding leases)	$	2,831.2	$	4,377.6	$	7,208.8	$	7,708.3	$	2,615.1	$	4,058.6	$	6,673.7	$	7,708.3
Letters of credit
Letters of Credit
Standby letters of credit		29.0		232.6		261.6		259.6		34.7		212.1		246.8		259.6
Other letters of credit		10.5		3.9		14.4		9.0		9.8		2.5		12.3		9.0
Deferred purchase agreements		1,835.1		—		1,835.1		1,929.4
Deferred Purchase Agreements										2,170.5		—		2,170.5		1,929.4
Purchase and Funding Commitments
Lessor commitments⁽¹⁾	$	572.4	$	—	$	572.4	$	628.3		408.2		—		408.2		628.3

Financing commitments, referred to as loan commitments or lines of credit, primarily reflect CIT’s agreements to lend to its customers, subject to the customers’ compliance with contractual obligations. At ~~June~~September 30, 2021, substantially all undrawn financing commitments were senior facilities. Most of the Company’s undrawn and available financing commitments are in the Commercial Banking segment.

As financing commitments may not be fully drawn, may expire unused, may be reduced or canceled at the customer’s request, and may require the customer to be in compliance with certain conditions, total commitment amounts do not necessarily reflect actual future cash flow requirements.

The table above excludes uncommitted revolving credit facilities extended by Commercial Finance to its clients for working capital purposes. In connection with these facilities, Commercial Finance has the sole discretion throughout the duration of these facilities to determine the amount of credit that may be made available to its clients at any time and whether to honor any specific advance requests made by its clients under these credit facilities.

In the normal course of meeting the needs of clients, CIT sometimes enters into agreements to provide financing and letters of credit. Standby letters of credit are issued by CIT to guarantee payment to the beneficiary if a client on whose behalf the letter of credit was issued does not meet its obligation. These financial instruments generate fees and involve, to varying degrees, elements of credit risk in excess of amounts recognized in the Consolidated Balance Sheets. To minimize potential credit risk, CIT generally requires collateral, and, in some cases, additional forms of credit support from the client.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

A DPA is a guarantee provided in conjunction with factoring, whereby CIT provides a client with credit protection for trade receivables without purchasing the receivables. The trade receivables terms generally require payment in 90 days or less. If the client’s customer is unable to pay an undisputed receivable solely as the result of credit risk, CIT is then required to purchase the receivable from the client, less any borrowings for such client. The outstanding amount in the table above, less ~~$75.4~~$124.7 million and $157.9 million at ~~June~~September 30, 2021 and December 31, 2020, respectively, of borrowings for such clients, is the maximum amount that CIT would be required to pay under all DPAs. This maximum amount would only occur if all receivables subject to DPAs default in the manner described above, thereby requiring CIT to purchase all such receivables from the DPA clients.

The table above includes $~~1,723.1~~2,129.5 million and $1,881.9 million of DPA credit protection at ~~June~~September 30, 2021 and December 31, 2020, respectively, related to receivables on which ~~have been presented to us for~~CIT has assumed the credit ~~protection after shipment of goods has occurred and the customer has been invoiced.~~risk. The table also includes ~~$112.0~~$41.0 million and $47.5 million available under DPA credit line agreements provided at ~~June~~September 30, 2021 and December 31, 2020, respectively. The DPA credit line agreements specify a contractually committed amount of DPA credit protection and are cancellable by us only after a notice period. The notice period is typically 90 days or less.

CIT is involved, and from time to time in the future may be involved, in a number of pending and threatened judicial, regulatory, and arbitration proceedings as well as proceedings, investigations, examinations and other actions brought or considered by governmental and self-regulatory agencies. These matters arise in connection with the conduct of CIT’s business. At any given time, CIT may also be in the process of responding to subpoenas, requests for documents, data and testimony relating to such matters and engaging in discussions to resolve the matters (all of the foregoing collectively being referred to as “Litigation”). While most Litigation relates to individual claims, CIT is also subject to putative class action claims and similar broader claims and indemnification obligations.

In view of the inherent difficulty of predicting the outcome of Litigation matters and indemnification obligations, particularly when such matters are in their early stages or where the claimants seek indeterminate damages, CIT cannot state with confidence what the eventual outcome of the pending Litigation will be, what the timing of the ultimate resolution of these matters will be, or what the eventual loss, fines, or penalties related to each pending matter will be, if any. In accordance with applicable accounting guidance, CIT establishes reserves for Litigation when those matters present loss contingencies as to which it is both probable that a loss will occur and the amount of such loss can reasonably be estimated. Based on currently available information, CIT believes that the outcome of Litigation that is currently pending will not have a material adverse effect on the Company’s financial condition, but may be material to the Company’s operating results or cash flows for any particular period, depending in part on its operating results for that period. The actual results of resolving such matters may be substantially higher than the amounts reserved.

For certain Litigation matters in which the Company is involved, the Company is able to estimate a range of reasonably possible losses in excess of established reserves and insurance. For other matters for which a loss is probable or reasonably possible, such an estimate cannot be determined. For Litigation and other matters where losses are reasonably possible, management currently estimates ~~the~~an aggregate range of reasonably possible losses asof up to $10 million in excess of any established reserves and any insurance we reasonably believe we will collect related to those matters. This estimate represents reasonably possible losses (in excess of established reserves and insurance) over the life of such Litigation, which may span a currently indeterminable number of years, and is based on information currently available as of ~~June~~September 30, 2021. The Litigation matters underlying the estimated range will change from time to time, and actual results may vary significantly from this estimate.

Those Litigation matters for which an estimate is not reasonably possible or as to which a loss does not appear to be reasonably possible, based on current information, are not included within this estimated range and, therefore, this estimated range does not represent the Company’s maximum loss exposure.

The foregoing statements about CIT’s Litigation are based on the Company’s judgments, assumptions, and estimates and are necessarily subjective and uncertain. The Company has several hundred threatened and pending judicial, regulatory and arbitration proceedings at various stages.

On October 21, 2016, CIT and CIT Bank were named as defendants in an existing lawsuit brought as a qui tam (i.e., whistleblower) action by a former OneWest employee on behalf of the U.S. government. The lawsuit asserts claims related to OneWest’s participation in the Home Affordable Modification Program (“HAMP”) administered by the United States Treasury Department, as well as Federal Housing Administration (“FHA”) and Veterans Administration (“VA”) insurance programs. On October 15, 2019, the plaintiff filed a second amended complaint in the United States District Court for the Eastern District of Texas alleging that, beginning in 2009, CIT (and its predecessor, OneWest) falsely certified its compliance with HAMP, submitted false claims for incentive payments for loan modifications, submitted false claims for FHA and VA insurance payments, and failed to self-report these violations. Plaintiff seeks the return of all U.S. government payments to CIT under the HAMP, FHA or VA programs. CIT has received approximately $93 million in servicer incentives under HAMP, and the government has paid more than ~~$400~~$440 million in the aggregate in borrower, servicer, and investor incentives in connection with loans modified by OneWest or CIT under HAMP. The Department of Justice has declined to intervene in this case. On February 12, 2021, CIT filed a motion to dismiss for lack of subject matter jurisdiction, which ~~is still pending.~~was denied on August 17, 2021. On June 24, 2021, CIT filed a Motion for Summary Judgment under Federal Rule of Civil Procedure 56 and filed a separate Motion for Partial Summary Judgment under the Public Disclosure Bar. Both motions remain pending. A Final Pretrial Conference ~~is scheduled~~has been rescheduled for ~~December 2, 2021.~~June 15, 2022, with a jury trial to commence on June 20, 2022. CIT is defending this litigation vigorously and believes that it has meritorious defenses.

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

Refer to Note 24 — Business Segment Information in our 2020 Form 10-K for detail on CIT’s business ~~segments.~~segments, including types of products and services offered.

	Commercial Banking			Consumer Banking			Corporate			Total CIT			Commercial Banking			Consumer Banking			Corporate			Total CIT
Quarter Ended June 30, 2021
Quarter Ended September 30, 2021
Interest income	$	281.1		$	75.2		$	16.8		$	373.1		$	269.8		$	72.4		$	17.6		$	359.8
Interest expense (benefit)		77.5			(22.8	)		52.1			106.8			69.8			(21.4	)		54.6			103.0
Provision for credit losses		(66.8	)		(5.4	)		-			(72.2	)		(49.3	)		(17.8	)		—			(67.1	)
Rental income on operating leases		188.2			-			-			188.2			186.2			—			—			186.2
Other non-interest income		111.2			36.6			12.9			160.7			89.7			34.0			1.0			124.7
Depreciation on operating lease equipment		82.8			-			-			82.8			85.1			—			—			85.1
Maintenance and other operating lease expenses		54.8			-			-			54.8			50.5			—			—			50.5
Operating expenses		183.0			93.1			(24.9	)		251.2			185.9			81.6			0.7			268.2
Income before provision (benefit) for income taxes	$	249.2		$	46.9		$	2.5		$	298.6
Income (loss) before provision (benefit) for income taxes													$	203.7		$	64.0		$	(36.7	)	$	231.0
Select Period End Balances
Total Assets	$	35,660.8		$	6,661.7		$	12,381.2		$	54,703.7		$	35,782.4		$	6,464.8		$	12,172.9		$	54,420.0
Loans		27,265.9			6,445.2			-			33,711.1			27,217.1			6,243.9			—			33,461.0
Credit balances of factoring clients		(1,530.5	)		-			-			(1,530.5	)		(1,556.6	)		—			—			(1,556.6	)
Assets held for sale		33.2			18.3			-			51.5			82.7			13.1			—			95.8
Operating lease equipment, net		7,781.8			-			-			7,781.8			7,937.5			—			—			7,937.5
Quarter Ended June 30, 2020
Quarter Ended September 30, 2020
Interest income	$	324.5		$	93.9		$	28.5		$	446.9		$	306.7		$	90.3		$	26.3		$	423.3
Interest expense		135.5			5.5			61.5			202.5
Provision for credit losses		214.7			8.9			-			223.6
Interest expense (benefit)														105.3			(5.9	)		66.1			165.5
Provision (benefit) for credit losses														87.9			(24.6	)		—			63.3
Rental income on operating leases		200.9			-			-			200.9			201.3			—			—			201.3
Other non-interest income		77.2			2.7			22.7			102.6			89.6			30.9			25.5			146.0
Depreciation on operating lease equipment		81.1			-			-			81.1			82.5			—			—			82.5
Maintenance and other operating lease expenses		56.1			-			-			56.1			48.6			—			—			48.6
Operating expenses/gain on debt extinguishment and deposit redemption		201.2			101.4			43.0			345.6			196.7			94.9			3.9			295.5
Loss before provision (benefit) for income taxes	$	(86.0	)	$	(19.2	)	$	(53.3	)	$	(158.5	)
Income (loss) before provision (benefit) for income taxes													$	76.6		$	56.8		$	(18.2	)	$	115.2
Select Period End Balances
Total Assets	$	37,712.9		$	8,714.2		$	15,275.3		$	61,702.4		$	37,868.5		$	8,255.3		$	14,741.2		$	60,865.0
Loans		28,972.9			8,545.4			-			37,518.3			29,244.6			8,075.0			—			37,319.6
Credit balances of factoring clients		(989.1	)		-			-			(989.1	)		(1,320.2	)		—			—			(1,320.2	)
Assets held for sale		54.8			27.9			-			82.7			35.5			21.2			—			56.7
Operating lease equipment, net		7,778.1			-			-			7,778.1			7,799.3			—			—			7,799.3

CIT Group Inc. and Subsidiaries – Notes to Condensed Consolidated Financial Statements (Unaudited)

	Commercial Banking			Consumer Banking			Corporate			Total CIT			Commercial Banking			Consumer Banking			Corporate			Total CIT
Six Months Ended June 30, 2021
Nine Months Ended September 30, 2021
Interest income	$	572.2		$	149.2		$	39.8		$	761.2		$	842.0		$	221.6		$	57.4		$	1,121.0
Interest expense (benefit)		166.2			(42.5	)		102.7			226.4			236.0			(63.9	)		157.3			329.4
(Benefit) provision for credit losses		(171.3	)		(18.3	)		-			(189.6	)		(220.6	)		(36.1	)		—			(256.7	)
Rental income on operating leases		382.9			-			-			382.9			569.1			—			—			569.1
Other non-interest income		202.9			63.1			124.6			390.6			292.6			97.1			125.6			515.3
Depreciation on operating lease equipment		167.5			-			-			167.5			252.6			—			—			252.6
Maintenance and other operating lease expenses		106.4			-			-			106.4			156.9			—			—			156.9
Operating expenses/loss on debt extinguishment and deposit redemption		369.9			172.6			(17.2	)		525.3			555.8			254.2			(16.5	)		793.5
Income from continuing operations before provision (benefit) for income taxes	$	519.3		$	100.5		$	78.9		$	698.7		$	723.0		$	164.5		$	42.2		$	929.7
Six Months Ended June 30, 2020
Nine Months Ended September 30, 2020
Interest income	$	692.4		$	195.5		$	72.6		$	960.5		$	999.1		$	285.8		$	98.9		$	1,383.8
Interest expense (benefit)		299.0			(4.6	)		133.8			428.2			404.3			(10.5	)		199.9			593.7
Provision for credit losses		723.6			13.9			-			737.5
Provision (benefit) for credit losses														811.5			(10.7	)		—			800.8
Rental income on operating leases		410.7			-			-			410.7			612.0			—			—			612.0
Other non-interest income		164.5			16.7			52.0			233.2			254.1			47.6			77.5			379.2
Depreciation on operating lease equipment		159.4			-			-			159.4			241.9			—			—			241.9
Maintenance and other operating lease expenses		109.7			-			-			109.7			158.3			—			—			158.3
Operating expenses/gain on debt extinguishment and deposit redemption		414.5			203.5			62.0			680.0			611.2			298.4			65.9			975.5
Goodwill impairment		301.5			43.2			-			344.7			301.5			43.2			—			344.7
(Loss) income from continuing operations before provision (benefit) for income taxes	$	(740.1	)	$	(43.8	)	$	(71.2	)	$	(855.1	)	$	(663.5	)	$	13.0		$	(89.4	)	$	(739.9	)

On July 14, 2021, CIT and First Citizens jointly announced that the proposal to merge the two companies has received regulatory approval from the FDIC. The merger has already received approval from the Office of the North Carolina Commissioner of Banks.

Completion of the proposed merger remains subject to approval from the Board of Governors of the Federal Reserve System, and closing is expected in the third quarter, subject to such regulatory approval and the satisfaction or waiver of other customary closing conditions.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

CIT Group Inc. is a bank holding company ("BHC") and a financial holding company ("FHC"). CIT Group Inc., together with its subsidiaries (collectively "we", "our", "CIT" or the "Company"), is regulated by the Board of Governors of the Federal Reserve System ("FRB") and the Federal Reserve Bank of New York ("FRBNY") under the U.S. Bank Holding Company Act of 1956, as amended. CIT Bank, N.A. is regulated by the Office of the Comptroller of the Currency of the U.S. Department of the Treasury ("OCC"). In addition, CIT Bank, as an insured depository institution, is supervised by the Federal Deposit Insurance Corporation (“FDIC”). More information about the Company is available at cit.com.

Management's Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures about Market Risk ("MD&A") contain financial terms that are relevant to our business, and a Glossary of select key terms is included in Item 1. Business Overview in our Annual Report on Form 10-K for the year ended December 31, 2020 (“2020 Form 10-K”).

Management uses certain non-GAAP financial measures in its analysis of the financial condition and results of operations of the Company. See "Non-GAAP Financial ~~Measurements"~~Measurements at the end of the MD&A for a reconciliation of these financial measures to comparable financial measures in accordance with U.S. GAAP.

Throughout this MD&A we reference specific "Notes" to our financial statements. These are Notes to the Condensed Consolidated Financial Statements in Part One, Item 1. Financial Statements (“Item 1”).

On October 16, 2020, First Citizens BancShares, Inc. (“First Citizens”), the parent company of First-Citizens Bank & Trust Company (“FCB”), and CIT Group Inc. jointly announced that they entered into a definitive agreement by and among First Citizens, FCB, FC Merger Subsidiary IX, Inc. and CIT, under which the companies will combine in an all-stock merger (the “Merger Agreement”). Under the terms of the Merger Agreement, CIT stockholders will receive 0.062 shares of First Citizens Class A common stock for each share of CIT common stock they own. First Citizens stockholders will own approximately 61% and CIT stockholders will own approximately 39% of the combined company. The Merger Agreement contains customary representations and warranties and customary covenants, such as non-solicitation obligations and other provisions, including a break-up fee of $64 million payable in certain circumstances. The Merger Agreement also provides certain termination rights for CIT and First Citizens, including, among others, if the merger has not been completed by October 15, 2021. On September 30, 2021, First Citizens and CIT jointly announced that the two companies agreed to extend the merger agreement from October 15, 2021, to March 1, 2022.

The combined bank will be regulated by the North Carolina Commissioner of Banks, the FDIC, and the Federal Reserve Bank of Richmond.

The Board of Directors of the combined company will ~~consist of~~have 14 directors, consisting of the current 11 First Citizens Board members and 3 CIT Board members, including Ellen Alemany, Chairwoman and Chief Executive Officer (“CEO”) of CIT, Michael A. Carpenter, and Vice Admiral John R. Ryan, USN (Ret.).

The combined company will operate under the First Citizens name and will be headquartered in Raleigh, N.C., and will maintain significant operations in California, Nebraska, Arizona, Florida, and South Carolina, as well as in New York and New Jersey. The pro forma organization will include over $100 billion in assets and over $80 billion in deposits.

On December 8, 2020, First Citizens and FCB filed applications with the FRB, FDIC, and the North Carolina Commissioner of Banking requesting approval of the proposed merger with CIT and CIT Bank. On February 9, 2021, CIT held a special meeting of shareholders, at which shareholders approved the adoption of the Merger Agreement. First Citizens also announced that on February 9, 2021, its shareholders approved the issuance of shares of its Class A common stock pursuant to the terms of the Merger Agreement.

On July 14, 2021, First Citizens and CIT jointly announced that the proposal to merge the two companies ~~has~~ received regulatory approval from the FDIC. The merger ~~has~~had already received approval from the Office of the North Carolina Commissioner of Banks.

Completion of the proposed merger remains subject to approval from the Board of Governors of the Federal Reserve System, ~~and closing is expected in the third quarter, subject to such regulatory approval~~ and the satisfaction or waiver of other customary closing conditions.

The following table summarizes the Company’s results in accordance with U.S. GAAP as included in the Condensed Consolidated Statements of Operations for the ~~quarters~~quarter and ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, and the quarter ended ~~March 31,~~June 30, 2021. We similarly provide results that exclude noteworthy items, which are described and reconciled to GAAP in the Non-GAAP Financial Measurements section at the end of the MD&A. As explained further in the Non-GAAP Financial Measurements section, we exclude noteworthy items to reflect how management views the underlying performance of the business.

	Quarters Ended									Six Months Ended						Quarters Ended								Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,		June 30,			September 30,			September 30,			September 30,
	2021			2021			2020			2021			2020			2021		2021			2020			2021			2020
Net income (loss) available to common shareholders (GAAP)	$	214.6		$	301.0		$	(97.6	)	$	515.6		$	(725.7	)	$	172.7	$	214.6		$	82.9		$	688.3		$	(642.8	)
Noteworthy items		(4.8	)		(56.4	)		36.2			(61.2	)		425.9			12.5		(4.8	)		(0.2	)		(48.7	)		425.7
Net Income (loss) available to common shareholders, excluding noteworthy items (non-GAAP)	$	209.8		$	244.6		$	(61.4	)	$	454.4		$	(299.8	)	$	185.2	$	209.8		$	82.7		$	639.6		$	(217.1	)
Diluted income (loss) per common share
Net income (loss) available to common shareholders (GAAP)	$	2.14		$	3.04		$	(0.99	)	$	5.17		$	(7.39	)	$	1.72	$	2.14		$	0.84		$	6.89		$	(6.54	)
Noteworthy items		(0.05	)		(0.57	)		0.37			(0.61	)		4.34			0.12		(0.05	)		0.00			(0.49	)		4.33
Net Income (loss) available to common shareholders, excluding noteworthy items (non-GAAP)	$	2.09		$	2.47		$	(0.62	)	$	4.56		$	(3.05	)	$	1.84	$	2.09		$	0.84		$	6.40		$	(2.21	)
Average number of common shares - diluted (thousands)		100,340			99,076			98,438			99,708			98,263			100,432		100,340			98,556			99,950			98,350

~~Second~~Third quarter net income available to common shareholders was ~~$214.6~~$172.7 million or ~~$2.14~~$1.72 per diluted common share and included ~~$4.8~~$12.5 million of noteworthy items ~~($0.05~~or $0.12 per ~~share)~~share as detailed in the following table. ~~Compared~~Excluding noteworthy items¹, third quarter income available to common shareholders was $185.2 million ($1.84 per share) compared to $209.8 million ($2.09 per share) in the prior quarter, reflecting lower interest income from lower average earning assets, lower non-interest income driven by lower gains on loan sales, higher operating expenses and a lower net benefit to the provision for credit losses of $67.1 million (compared to a net benefit of $72.2 million in the prior quarter). The net benefits reflect lower loan balances, as well as continued improvements in credit trends and certain macroeconomic variable forecasts.

Income in the year-ago quarter included two noteworthy items that essentially offset each other. One related to the integration of Mutual of Omaha Bank (“MOB”) and other cost initiatives of approximately $9 million ($0.09 per common share), which was offset by a reversal of compensation accrual due to a decrease in the probability of achieving certain performance conditions related to the Company’s stock-based compensation. Excluding noteworthy items, the 2020 third quarter income to common shareholders was $82.7 million or $0.84 per diluted common share.

Year-to-date net income available to common shareholders ~~was down. Last quarter~~ included significant gains on investment sales related to our strategic initiative to monetize unrealized gains within accumulated other comprehensive income (“AOCI”), which was considered noteworthy. ~~Excluding noteworthy items~~¹, second quarter income available to common shareholders was $209.8 million ($2.09 per share) compared to $244.6 million ($2.47 per share) in the prior quarter reflecting a lower net benefit to the provision for credit losses of $72.2 million, while the prior quarter included a net benefit of $117.4 million. The net benefits reflect lower loan balances (including off-balance sheet credit exposures), as well as improvements in credit trends and economic forecasts.

The loss in the year-ago quarter included noteworthy items that were primarily related to the integration of Mutual of Omaha Bank (“MOB”) and other cost initiatives. Excluding noteworthy items, the 2020 second quarter loss to common shareholders was $61.4 million or $0.62 per diluted common share, reflecting an elevated provision for credit losses, along with the continued impacts of the macroeconomic environment at that time.

~~The loss in the year-ago six-month~~nine-month period also included noteworthy items consisting of a goodwill impairment charge, MOB merger and integration costs and MOB day 1 credit provision. Excluding noteworthy items, the loss to common shareholders primarily reflected ~~an elevated provision for~~the building of credit ~~losses,~~reserves in the first half of 2020 due to the impact of the global pandemic and its adverse effect on the portfolio, along with the adoption of the CECL standard and the continued impacts of the macroeconomic environment at that time.

~~See~~ ~~Non-GAAP~~ Financial ~~Measurements~~ results for ~~a listing of each~~the 2021 third quarter included the following noteworthy ~~item and respective balance.~~items:

Financial results for the 2021 second quarter included the following noteworthy items:

Financial results for the 2021 first quarter included the following noteworthy items:

The following table reflects the impact of noteworthy items on our GAAP results for the quarter and ~~six~~nine months ended ~~June~~September 30, 2021. See Non-GAAP Financial Measurements ~~section.~~for a listing of each noteworthy item and respective balance.

Noteworthy Adjustments – After-tax (dollars in millions, except diluted per share amounts)

	Quarter Ended June 30, 2021						Six Months Ended June 30, 2021						Quarter Ended September 30, 2021				Nine Months Ended September 30, 2021
				Per Share						Per Share					Per Share					Per Share
Net income available to common shareholders (GAAP)	$	214.6		$	2.14		$	515.6		$	5.17		$	172.7	$	1.72	$	688.3		$	6.89
CTA release														12.1		0.12		12.1			0.12
FCB merger costs		1.3			0.01			6.4			0.06			0.4		0.00		6.8			0.07
Reversal of prior restructuring charges		(6.1	)		(0.06	)		(6.1	)		(0.06	)		—		—		(6.1	)		(0.06	)
Gains on strategic sales of investment securities		-			-			(61.5	)		(0.62	)		—		—		(61.5	)		(0.62	)
Non-GAAP results	$	209.8		$	2.09		$	454.4		$	4.56		$	185.2	$	1.84	$	639.6		$	6.40

Net interest revenue reflects our interest income less interest expense and is included as a line item on the Condensed Consolidated Statements of Operations. Net interest revenue was ~~$266.3~~$256.8 million for the quarter ended ~~June~~September 30, 2021, slightly down from ~~$244.4~~$257.8 million in the year-ago quarter and ~~$268.5~~down from $266.3 million in the prior quarter. Net interest revenue was ~~$534.8~~$791.6 million and ~~$532.3~~$790.1 million for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively.

Key metrics used by management to measure the profitability of our earning assets are Net Finance Revenue (“NFR”)² and Net Finance Margin² ("NFM"). NFR is a non-GAAP measurement that includes net interest revenue (interest and fees on loans, interest on interest-bearing cash, and interest/dividends on investments less interest expense on deposits and borrowings) plus net operating lease revenue² (rental income on operating lease equipment less depreciation on operating lease equipment and maintenance and other operating lease expenses). Due to the nature of our portfolio, which includes a higher proportion of operating lease equipment than most BHCs, certain financial measures commonly used by other BHCs, such as net interest income (“NII”), are not as meaningful for CIT. NII is not used because it includes the impact of debt costs of our operating lease assets but excludes the associated rental income.

NFM is NFR calculated as a percentage of average earning assets²(“AEA”). NFM is used by management, instead of net interest margin (“NIM”), for the same reasons noted for NFR.

The consolidated financial statements include the effects of purchase accounting adjustment (“PAA”) accretion. Accretion and amortization of certain purchase accounting adjustments primarily impact interest income and interest expense and are summarized in a table in this section.

The following table presents the average balance sheet and related rates, along with NFR and NFM.

	Quarters Ended																								Quarters Ended
	June 30, 2021								March 31, 2021								June 30, 2020								September 30, 2021								June 30, 2021								September 30, 2020
	Average Balance			Income / Expense		Yield / Rate			Average Balance			Income / Expense		Yield / Rate			Average Balance			Income / Expense		Yield / Rate			Average Balance			Income / Expense		Yield / Rate			Average Balance			Income / Expense		Yield / Rate			Average Balance			Income / Expense		Yield / Rate
Interest-bearing cash	$	5,583.1		$	1.5		0.11	%	$	4,634.4		$	1.3		0.11	%	$	7,110.7		$	1.8		0.10	%	$	5,296.6		$	2.0		0.15	%	$	5,583.1		$	1.5		0.11	%	$	7,652.1		$	2.1		0.11	%
Investment securities and securities purchased under agreements to resell		5,247.5			15.9		1.21	%		6,144.3			22.8		1.48	%		5,766.4			27.9		1.94	%		5,322.4			15.9		1.19	%		5,247.5			15.9		1.21	%		5,989.9			25.4		1.70	%
Loans (including held for sale)⁽²⁾⁽³⁾		33,226.5			355.7		4.28	%		34,592.3			364.0		4.21	%		37,109.8			417.2		4.50	%		31,865.6			341.9		4.29	%		33,226.5			355.7		4.28	%		36,301.6			395.8		4.36	%
Total interest earning assets⁽²⁾⁽³⁾		44,057.1			373.1		3.39	%		45,371.0			388.1		3.42	%		49,986.9			446.9		3.58	%		42,484.6			359.8		3.39	%		44,057.1			373.1		3.39	%		49,943.6			423.3		3.39	%
Operating lease equipment, net (including held for sale)⁽⁴⁾		7,754.0			50.6		2.61	%		7,831.2			58.4		2.98	%		7,602.1			63.7		3.35	%		7,862.5			50.6		2.57	%		7,754.0			50.6		2.61	%		7,824.4			70.2		3.59	%
Average earning assets⁽²⁾⁽⁵⁾		51,811.1			423.7		3.27	%		53,202.2			446.5		3.36	%		57,589.0			510.6		3.55	%		50,347.1			410.4		3.26	%		51,811.1			423.7		3.27	%		57,768.0			493.5		3.42	%
Non-interest earning assets
Cash and due from banks		169.7								180.1								185.8								171.6								169.7								175.9
Allowance for credit losses		(926.7	)							(1,055.0	)							(1,102.4	)							(842.1	)							(926.7	)							(1,196.1	)
All other non-interest bearing assets		3,255.7								3,420.1								3,577.2								3,281.7								3,255.7								3,685.8
Total assets	$	54,309.8							$	55,747.4							$	60,249.6							$	52,958.3							$	54,309.8							$	60,433.6

Interest-bearing deposits and borrowings
Deposits	$	38,283.0		$	50.7		0.53	%	$	39,300.8		$	61.2		0.62	%	$	41,857.7		$	138.3		1.32	%	$	37,451.0		$	47.3		0.51	%	$	38,283.0		$	50.7		0.53	%	$	42,320.5		$	103.2		0.98	%
Borrowings		4,832.1			56.1		4.64	%		5,453.6			58.4		4.28	%		7,958.4			64.2		3.23	%		4,245.6			55.7		5.25	%		4,832.1			56.1		4.64	%		7,557.5			62.3		3.30	%
Total interest-bearing liabilities		43,115.1			106.8		0.99	%		44,754.4			119.6		1.07	%		49,816.1			202.5		1.63	%		41,696.6			103.0		0.99	%		43,115.1			106.8		0.99	%		49,878.0			165.5		1.33	%
Non-interest bearing deposits		3,360.9								3,385.9								3,019.6								3,411.8								3,360.9								3,073.4
Other non-interest bearing liabilities		1,906.0								1,845.3								1,597.7								1,723.6								1,906.0								1,734.2
Stockholders' equity		5,927.8								5,761.8								5,816.2								6,126.3								5,927.8								5,748.0
Total liabilities and stockholders' equity	$	54,309.8							$	55,747.4							$	60,249.6							$	52,958.3							$	54,309.8							$	60,433.6
Net revenue spread							2.28	%							2.29	%							1.92	%							2.27	%							2.28	%							2.09	%
Impact of non-interest bearing sources							0.17	%							0.17	%							0.22	%							0.17	%							0.17	%							0.18	%
NFR ($) / NFM (%)⁽²⁾⁽⁵⁾				$	316.9		2.45	%				$	326.9		2.46	%				$	308.1		2.14	%				$	307.4		2.44	%				$	316.9		2.45	%				$	328.0		2.27	%

	Six Months Ended																Nine Months Ended
	June 30, 2021								June 30, 2020								September 30, 2021									September 30, 2020
	Average Balance			Income / Expense		Yield / Rate			Average Balance			Income / Expense		Yield / Rate			Average Balance				Income / Expense		Yield / Rate			Average Balance			Income / Expense		Yield / Rate
Interest-bearing cash	$	5,111.3		$	2.8		0.11	%	$	4,463.9		$	7.4		0.33	%	$	5,173.6			$	4.8		0.12	%	$	5,534.4		$	9.5		0.23	%
Investment securities and securities purchased under agreements to resell		5,693.5			38.7		1.36	%		6,862.2			68.3		1.99	%		5,568.4				54.6		1.31	%		6,569.3			93.7		1.90	%
Loans (including held for sale)⁽²⁾⁽³⁾		33,905.6			719.7		4.25	%		36,801.7			884.8		4.81	%		33,218.2				1,061.6		4.26	%		36,633.8			1,280.6		4.66	%
Interest earning assets		44,710.4			761.2		3.41	%		48,127.8			960.5		3.99	%		43,960.2				1,121.0		3.40	%		48,737.5			1,383.8		3.79	%
Operating lease equipment, net (including held for sale)⁽⁴⁾		7,792.4			109.0		2.80	%		7,509.1			141.6		3.77	%		7,816.0				159.6		2.72	%		7,615.0			211.8		3.71	%
Average earning assets⁽²⁾⁽⁵⁾		52,502.8			870.2		3.31	%		55,636.9			1,102.1		3.96	%		51,776.2				1,280.6		3.30	%		56,352.5			1,595.6		3.78	%
Non-interest earning assets
Cash and due from banks		174.9								206.9								173.9									196.5
Allowance for credit losses		(990.5	)							(933.0	)							(940.5	)								(1,021.4	)
All other non-interest bearing assets		3,337.4								3,564.6								3,318.7									3,605.3
Total assets	$	55,024.6							$	58,475.4							$	54,328.3								$	59,132.9

Interest-bearing deposits and borrowings
Deposits	$	38,789.1		$	111.9		0.58	%	$	40,451.4		$	294.9		1.46	%	$	38,338.2			$	159.2		0.55	%	$	41,079.0		$	398.1		1.29	%
Borrowings		5,141.1			114.5		4.45	%		7,454.9			133.3		3.58	%		4,839.3		��		170.2		4.69	%		7,489.4			195.6		3.48	%
Total interest-bearing liabilities		43,930.2			226.4		1.03	%		47,906.3			428.2		1.79	%		43,177.5				329.4		1.02	%		48,568.4			593.7		1.63	%
Non-interest bearing deposits		3,373.3								2,838.8								3,386.3									2,917.5
Other non-interest bearing liabilities		1,875.8								1,598.6								1,824.6									1,644.1
Stockholders' equity		5,845.2								6,131.7								5,939.9									6,002.9
Total liabilities and stockholders' equity	$	55,024.5							$	58,475.4							$	54,328.3								$	59,132.9
Net revenue spread							2.28	%							2.17	%								2.28	%							2.15	%
Impact of non-interest bearing sources							0.17	%							0.25	%								0.17	%							0.22	%
NFR ($) / NFM (%)⁽²⁾⁽⁵⁾				$	643.8		2.45	%				$	673.9		2.42	%					$	951.2		2.45	%				$	1,001.9		2.37	%

The following table presents disaggregated quarter-over-quarter changes in net interest revenue and operating lease margins as presented in the preceding table between volume (level of lending or borrowing) and rate (rates charged to customers or incurred on borrowings). Volume change is calculated as change in volume times the previous rate, while rate change is calculated as change in rate times the previous volume. The rate/volume change, change in rate times change in volume, is allocated between volume change and rate change at the ratio each component bears to the absolute value of their total.

	June 2021 Over March 2021 Comparison									June 2021 Over June 2020 Comparison									September 2021 Over June 2021 Comparison									September 2021 Over September 2020 Comparison
	Increase (Decrease) Due To Change In:									Increase (Decrease) Due To Change In:									Increase (Decrease) Due To Change In:									Increase (Decrease) Due To Change In:
	Volume			Rate			Net			Volume			Rate			Net			Volume			Rate			Net			Volume			Rate			Net
Interest-bearing cash	$	0.2		$	-		$	0.2		$	(0.5	)	$	0.2		$	(0.3	)	$	—		$	0.5		$	0.5		$	(0.7	)	$	0.6		$	(0.1	)
Investment securities and securities purchased under agreement to resell		(3.1	)		(3.8	)		(6.9	)		(2.2	)		(9.8	)		(12.0	)		0.3			(0.3	)		—			(2.5	)		(7.0	)		(9.5	)
Loans and loans held for sale⁽²⁾⁽³⁾		(14.3	)		6.0			(8.3	)		(41.8	)		(19.7	)		(61.5	)		(14.6	)		0.8			(13.8	)		(47.6	)		(6.3	)		(53.9	)
Operating lease equipment, net (including held for sale)⁽⁴⁾		(0.6	)		(7.2	)		(7.8	)		1.2			(14.3	)		(13.1	)		0.8			(0.8	)		—			0.4			(20.0	)		(19.6	)
AEA⁽²⁾⁽⁵⁾	$	(17.8	)	$	(5.0	)	$	(22.8	)	$	(43.3	)	$	(43.6	)	$	(86.9	)	$	(13.5	)	$	0.2		$	(13.3	)	$	(50.4	)	$	(32.7	)	$	(83.1	)

Interest-bearing deposits	$	(1.9	)	$	(8.6	)	$	(10.5	)	$	(11.1	)	$	(76.5	)	$	(87.6	)	$	(1.5	)	$	(1.9	)	$	(3.4	)	$	(10.8	)	$	(45.1	)	$	(55.9	)
Borrowings		(7.0	)		4.7			(2.3	)		(30.4	)		22.3			(8.1	)		(7.3	)		6.9			(0.4	)		(34.2	)		27.6			(6.6	)
Total interest-bearing liabilities	$	(8.9	)	$	(3.9	)	$	(12.8	)	$	(41.5	)	$	(54.2	)	$	(95.7	)	$	(8.8	)	$	5.0		$	(3.8	)	$	(45.0	)	$	(17.5	)	$	(62.5	)

NFR was ~~$316.9~~$307.4 million for the quarter ended ~~June~~September 30, 2021, updown from ~~$308.1~~$328.0 million in the year-ago quarter and down from ~~$326.9~~$316.9 million in the prior quarter. For the ~~six~~nine months ended ~~June~~September 30, 2021 and ~~June 30,~~ 2020, NFR was ~~$643.8~~$951.2 million and ~~$673.9~~$1,001.9 million, respectively.

~~Compared to~~The $20.6 million reduction in NFR from the year-ago quarter ~~NFR~~ was ~~up $8.8 million. NFR increased as~~primarily driven by lower interest income, ~~was~~ offset by the decline in deposit costs from lower deposit rates and balances along with a reduction in borrowing costs ~~driven by~~due to lower ~~rates and balances of~~ FHLB Advances and ~~the repayment of the secured facility.~~senior unsecured borrowings. See further discussion on deposits and borrowings below the following tables. The ~~decline~~reduction in interest income primarily reflected ~~a decrease in~~lower average loans, and ~~investment securities. Interest income also reflected~~to a lesser extent, the lower short-term interest rate environment, which decreased interest earned on our floating rate loan portfolio, and ~~lowered~~reduced reinvestment ~~rate~~rates for investments. Net operating lease revenue was down from the year-ago quarter, driven by lease rate compression on new assignments and renewals ~~partially offset by an increase~~ in ~~average operating leases.~~Rail. See the end of this section for more details on our operating lease portfolio. ~~For~~

The $9.5 million reduction in NFR from the ~~six~~prior quarter reflected lower interest income resulting from lower average balances on loans, lower purchase accounting accretion and prepayment benefits partially offset by lower deposit and borrowing costs. Net operating lease revenue remained flat compared to the prior quarter as lower maintenance costs offset lower rental revenue and higher depreciation.

The trend for the nine months ended ~~June~~September 30, 2021 ~~the decline in interest income outpaced the lower borrowing costs,~~ compared to the same period in ~~2020.~~

~~Compared~~2020 is similar to the prior quarter, NFR was down $10.0 million. NFR declined on lower interest income, reflecting lower average balances and yields on loans and investment securities and lower net operating lease revenue, partially offset by higher purchase accounting accretion from Legacy Consumer Mortgage (“LCM”) loan prepayments and lower deposit costs. The decline in net operating lease revenue reflected a customer receivable settlement of $6 million that mostly benefited rental income in the prior quarter. The NFR decline was partially offset by lower deposit costs primarily from lower rates and balances, along with lower borrowing costs from a decline in balances.quarterly discussion.

NFM was ~~2.45%~~2.44% for the quarter ended ~~June~~September 30, 2021, up from ~~2.14%~~2.27% in the year-ago quarter and ~~declined modestly~~down slightly from ~~2.46%~~2.45% in the prior quarter. NFM was 2.45% for the ~~six~~nine months ended ~~June~~September 30, 2021, up ~~slightly~~ from ~~2.42%~~2.37% in the year-ago period.

NFM increased from the year-ago quarter, reflecting lower weighted average deposit costs ~~from~~and the benefit of a lower ~~rates in all deposit channels,~~mix of cash and ~~lower borrowing balances.~~investment securities as a percentage of AEA. Lower deposit costs improved our margin as CDs repriced lower and we reduced our non-maturity deposit rates across our deposit channels. We also grew ~~lower cost~~ HOA deposits, further contributing to the mix of lower deposit costs. See further discussion on deposits and borrowings below the following tables. ~~Partially offsetting~~Increases in NFM were partially offset by lower market rates that reduced yields on loans and investment securities. Operating lease yields were down, driven by railcar lease renewal rates that re-priced ~~down. The increase also reflected higher purchase accounting accretion.~~lower.

The modest decline in NFM compared to the prior quarter ~~primarily~~generally reflected the items mentioned above in the description of the reduction of NFR as well as a slightly higher mix of ~~cash.~~average cash and investments as a percentage of AEA.

AEA was down compared to the year-ago and prior ~~quarters. AEA compared to the year-ago quarter decreased~~quarters, primarily from a reduction in average loans and ~~also included~~ lower interest-bearing cash, ~~and investment securities.~~while operating lease equipment remained relatively flat. The year-to-date decline in AEA compared to 2020 was similar to that described in the quarter discussion above.

Compared to the year-ago quarter, Commercial Banking total average loans and leases declined, ~~across all divisions~~ reflecting lower origination volume in sectors more impacted by the pandemic, the sale of the Aviation Lending portfolio, as well as high prepayments ~~particularly~~ in certain portfolios. Commercial Banking average loans and leases decreased from the prior quarter, reflecting continued elevated prepayments in certain portfolios along with a full quarter impact of the Aviation Lending portfolio sale that occurred in the second quarter. In addition, the Real Estate ~~Finance.~~ Finance portfolio continues to be impacted by prepayments and maturities that outpace new origination volume.

The decrease in Consumer Banking average loans ~~compared to year-ago quarter~~ was primarily driven by LCM loan sales and continued run-off, ~~as well as higher prepayments. The year-to-date decline in AEA compared to 2020 was driven by lower average loans.~~

AEA decreased from the prior quarter. The decline was driven by lower average loans and leases. Commercial Banking average loans and leases declined, primarily driven by the sale of the Aviation Lending portfolio within Commercial Finance, as well as a reduction in Real Estate Finance, which continues to be impacted by lower origination volume and high prepayments. Average loans were down in Consumer Banking, reflecting LCM loan sales and continued run off in the LCM portfolio, as well as higher prepayments in LCM loans and a ~~reduction in SBA PPP loans due to SBA forgiveness.~~

	Quarters Ended									Quarters Ended
	June 30,			March 31,			June 30,			September 30,			June 30,			September 30,
	2021			2021			2020			2021			2021			2020
Deposits		90	%		89	%		85	%		91	%		90	%		86	%
Unsecured borrowings		9	%		9	%		8	%		9	%		9	%		9	%

Secured Borrowings:
FHLB advances		1	%		2	%		6	%		0	%		1	%		5	%
Structured financings		0	%		0	%		1	%		0	%		0	%		0	%

Interest-Bearing Deposits and Borrowings — Average Balances and Annualized Rates for the Quarters Ended (dollars in millions)

	June 30, 2021							March 31, 2021							June 30, 2020							September 30, 2021							June 30, 2021							September 30, 2020
	Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)
Total interest-bearing deposits
Time deposits	$	8,538.0	$	24.4		1.14	%	$	9,781.4	$	33.9		1.39	%	$	12,551.0	$	59.7		1.90	%	$	8,054.9	$	21.1		1.05	%	$	8,538.0	$	24.4		1.14	%	$	11,850.9	$	53.0		1.79	%
Interest-bearing checking		3,491.7		2.5		0.29	%		3,442.4		2.6		0.30	%		3,163.3		3.0		0.38	%		3,467.4		2.5		0.29	%		3,491.7		2.5		0.29	%		3,282.6		2.9		0.35	%
Savings and money market		26,253.3		23.8		0.36	%		26,077.0		24.7		0.38	%		26,143.4		75.6		1.16	%		25,928.7		23.7		0.37	%		26,253.3		23.8		0.36	%		27,187.0		47.3		0.70	%
Total interest-bearing deposits		38,283.0		50.7		0.53	%		39,300.8		61.2		0.62	%		41,857.7		138.3		1.32	%		37,451.0		47.3		0.51	%		38,283.0		50.7		0.53	%		42,320.5		103.2		0.98	%
Borrowings
Senior unsecured	$	3,737.6	$	45.8		4.90	%	$	3,953.1	$	47.0		4.76	%	$	3,971.8	$	46.1		4.64	%	$	3,739.3	$	45.8		4.90	%	$	3,737.6	$	45.8		4.90	%	$	4,237.5	$	48.7		4.60	%
Subordinated unsecured		495.1		7.3		5.90	%		494.9		7.3		5.90	%		494.5		7.4		5.99	%		495.2		7.3		5.90	%		495.1		7.3		5.90	%		494.7		7.3		5.90	%
FHLB advances		590.7		0.5		0.34	%		998.6		1.9		0.76	%		3,038.0		6.6		0.87	%		—		—		—			590.7		0.5		0.34	%		2,809.8		4.1		0.58	%
Other secured and structured borrowings		8.7		0.1		NM			7.0		0.1	NM				448.8		2.5		2.23	%		11.1		0.1	NM				8.7		0.1	NM				15.5		0.1		2.58	%
Other credit facilities⁽¹⁾		-		2.5		-			-		2.1		-			-		1.6		-			—		2.5		—			—		2.4		—			—		2.1		—
Securities sold under agreement to repurchase		-		-		-			-		-		-			5.3		-		-
Total borrowings		4,832.1		56.1		4.64	%		5,453.6		58.4		4.28	%		7,958.4		64.2		3.23	%		4,245.6		55.7		5.25	%		4,832.1		56.1		4.64	%		7,557.5		62.3		3.30	%
Total interest-bearing liabilities	$	43,115.1	$	106.8		0.99	%	$	44,754.4	$	119.6		1.07	%	$	49,816.1	$	202.5		1.63	%	$	41,696.6	$	103.0		0.99	%	$	43,115.1	$	106.8		0.99	%	$	49,878.0	$	165.5		1.33	%

The following table reflects our total deposit base, interest bearing and non-interest-bearing deposits, and related rate:

Total Deposits — Average Balances and Annualized Rates for the Quarters Ended (dollars in millions)

	June 30, 2021							March 31, 2021							June 30, 2020							September 30, 2021							June 30, 2021							September 30, 2020
	Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)			Average Balance		Interest Expense		Rate (%)
Interest-bearing deposits	$	38,283.0	$	50.7		0.53	%	$	39,300.8	$	61.2		0.62	%	$	41,857.7	$	138.3		1.32	%	$	37,451.0	$	47.3		0.51	%	$	38,283.0	$	50.7		0.53	%	$	42,320.5	$	103.2		0.98	%
Non-interest bearing deposits		3,360.9		-		-			3,385.9		-		-			3,019.6		-		-			3,411.8		—		—			3,360.9		—		—			3,073.4		—		—
Total deposits	$	41,643.9	$	50.7		0.49	%	$	42,686.7	$	61.2		0.57	%	$	44,877.3	$	138.3		1.23	%	$	40,862.8	$	47.3		0.46	%	$	41,643.9	$	50.7		0.49	%	$	45,393.9	$	103.2		0.91	%

Compared to the year-ago and prior quarters, the decrease in average deposits reflected ~~strategic rate reductions, reducing~~a continuation of our strategy to reduce higher cost ~~time~~ deposits, including high cost CD maturities, and managing excess ~~liquidity, which~~liquidity. These offset growth in ~~the~~ HOA ~~channel~~deposits as we strategically grow this channel. Average HOA deposits totaled ~~16%~~17% of the total average deposits for the quarter ended ~~June~~September 30, 2021, up from 12% in the year-ago quarter and ~~15%~~16% in the prior quarter. The weighted average rate on average outstanding deposits decreased ~~74 bps~~ to ~~0.49%~~0.46% from ~~1.23%~~0.91% in the year-ago quarter reflecting lower rates across all but our brokered deposit channels and a higher mix of lower cost deposits. The weighted average rate on average outstanding deposits decreased ~~8 bps~~ from ~~0.57%~~0.49% in the prior quarter, primarily due to lower rates across most channels, ~~along with a~~driven by higher ~~mix of lower cost HOA deposits~~rate CD maturities and run-off of higher cost brokered deposits.

We continued to shift the mix from time deposits to non-maturity deposits. Average non-maturity deposits currently represent ~~79%~~80% of total deposits, compared to ~~77%~~79% in the prior quarter and ~~72%~~74% in the year-ago quarter.

See Funding and Liquidity section for tables that reflect period end deposits by type and by channel.

Interest expense on borrowings decreased compared to the year-ago and prior quarters, ~~driven by lower interest on~~mostly due to the repayment of FHLB advances ~~driven by both~~in the ~~lower average balance~~first and ~~lower rate,~~second quarters and the repayment of $500 million 4.125% senior unsecured notes in the ~~secured facility. The securities sold under agreement to repurchase were acquired as part of the MOB Acquisition and were fully repaid by the end of the 2020 second~~2021 first quarter. The weighted average maturity profile of the combined unsecured senior and subordinated notes is ~~3.1~~2.8 years at ~~June~~September 30, 2021, compared to 3.2 years at December 31, 2020.

The following table depicts selected earning asset yields and margin-related data for our segments and divisions within the segments.

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Commercial Banking
Average Earning Assets (AEA)
Commercial Finance	$	15,295.3		$	15,605.4		$	16,224.7		$	15,449.5		$	15,916.9		$	14,787.8		$	15,295.3		$	15,709.9		$	15,226.5		$	15,847.5
Business Capital		4,952.8			5,028.3			5,316.3			4,990.4			5,317.5			4,906.6			4,952.8			5,236.0			4,962.2			5,290.1
Rail		7,188.8			7,194.2			7,058.9			7,191.5			6,963.2			7,290.2			7,188.8			7,194.8			7,224.7			7,040.9
Real Estate Finance		6,890.3			7,412.1			7,652.0			7,149.8			7,631.7			6,461.6			6,890.3			7,728.4			6,917.9			7,664.1
Total	$	34,327.2		$	35,240.0		$	36,251.9		$	34,781.2		$	35,829.3		$	33,446.2		$	34,327.2		$	35,869.1		$	34,331.3		$	35,842.6

Net Finance Revenue
Commercial Finance	$	122.0		$	119.9		$	117.5		$	241.9		$	248.4		$	118.9		$	122.0		$	121.5		$	360.8		$	369.9
Business Capital		68.5			70.4			68.0			138.9			138.8			67.8			68.5			71.4			206.7			210.2
Rail		15.9			19.9			17.7			35.8			48.4			20.3			15.9			25.1			56.1			73.5
Real Estate Finance		47.8			50.6			49.5			98.4			99.4			43.6			47.8			53.6			142.0			153.0
Total	$	254.2		$	260.8		$	252.7		$	515.0		$	535.0		$	250.6		$	254.2		$	271.6		$	765.6		$	806.6

Gross Yield
Commercial Finance		3.96	%		4.00	%		4.33	%		3.98	%		4.76	%		3.96	%		3.96	%		4.14	%		3.98	%		4.55	%
Business Capital		8.98	%		9.22	%		8.95	%		9.10	%		9.08	%		8.89	%		8.98	%		9.11	%		9.03	%		9.09	%
Rail		8.13	%		8.29	%		8.92	%		8.21	%		9.33	%		7.97	%		8.13	%		8.68	%		8.13	%		9.11	%
Real Estate Finance		3.52	%		3.49	%		3.84	%		3.51	%		4.14	%		3.42	%		3.52	%		3.62	%		3.48	%		3.97	%
Total		5.47	%		5.51	%		5.80	%		5.49	%		6.16	%		5.45	%		5.47	%		5.67	%		5.48	%		5.99	%

Net Finance Margin
Commercial Finance		3.19	%		3.08	%		2.90	%		3.13	%		3.12	%		3.22	%		3.19	%		3.10	%		3.16	%		3.11	%
Business Capital		5.53	%		5.60	%		5.12	%		5.57	%		5.22	%		5.53	%		5.53	%		5.45	%		5.55	%		5.30	%
Rail		0.89	%		1.10	%		1.01	%		1.00	%		1.39	%		1.11	%		0.89	%		1.39	%		1.04	%		1.39	%
Real Estate Finance		2.78	%		2.73	%		2.58	%		2.75	%		2.60	%		2.70	%		2.78	%		2.78	%		2.74	%		2.66	%
Total		2.96	%		2.96	%		2.79	%		2.96	%		2.99	%		3.00	%		2.96	%		3.03	%		2.97	%		3.00	%

Consumer Banking
Average Earning Assets (AEA)
Consumer and Community Banking	$	5,308.4		$	5,745.9		$	6,592.7		$	5,525.9		$	6,551.3		$	5,119.6		$	5,308.4		$	6,446.9		$	5,389.0		$	6,516.3
Legacy Consumer Mortgages		1,501.8			1,653.7			2,065.6			1,577.3			2,110.7			1,316.2			1,501.8			1,979.7			1,489.3			2,066.7
Total	$	6,810.2		$	7,399.6		$	8,658.3		$	7,103.2		$	8,662.0		$	6,435.8		$	6,810.2		$	8,426.6		$	6,878.3		$	8,583.0

Net Finance Revenue
Consumer and Community Banking	$	65.4		$	63.9		$	53.4		$	129.3		$	129.4		$	62.3		$	65.4		$	60.4		$	191.6		$	189.8
Legacy Consumer Mortgages		32.6			29.8			35.0			62.4			70.7			31.5			32.6			35.8			93.9			106.5
Total	$	98.0		$	93.7		$	88.4		$	191.7		$	200.1		$	93.8		$	98.0		$	96.2		$	285.5		$	296.3

Gross Yield
Consumer and Community Banking		2.88	%		2.75	%		3.18	%		2.82	%		3.35	%		2.91	%		2.88	%		3.04	%		2.85	%		3.25	%
Legacy Consumer Mortgages		9.82	%		8.34	%		8.05	%		9.04	%		8.12	%		10.69	%		9.82	%		8.32	%		9.53	%		8.19	%
Total		4.41	%		4.00	%		4.34	%		4.20	%		4.52	%		4.50	%		4.41	%		4.28	%		4.30	%		4.44	%

Net Finance Margin
Consumer and Community Banking		4.93	%		4.44	%		3.24	%		4.68	%		3.95	%		4.87	%		4.93	%		3.74	%		4.74	%		3.88	%
Legacy Consumer Mortgages		8.68	%		7.22	%		6.79	%		7.92	%		6.70	%		9.57	%		8.68	%		7.25	%		8.41	%		6.87	%
Total		5.76	%		5.06	%		4.09	%		5.40	%		4.62	%		5.83	%		5.76	%		4.57	%		5.54	%		4.60	%

Gross yield (interest income plus rental income on operating leases as a percent of AEA) in Commercial Banking for the quarter ended ~~June~~September 30, 2021 was down from the year-ago quarter driven by decreases in all ~~divisions except Business Capital, which was up slightly.~~divisions. Compared to the prior quarter, gross yield in each of the divisions was ~~down slightly, except for a slight increase~~flat or down. Gross yield in ~~Real Estate Finance. Changes~~Commercial Finance was flat as modest impacts from asset mix and yields on new business as well as changes in average interest rates offset one another. The change in gross yield in ~~Commercial Finance and~~ Real Estate Finance ~~were~~was primarily driven by changes in asset mix ~~as well as compression on new business yields in Commercial Finance~~ and the impact from lower average interest rates. The Business Capital gross yield was ~~up slightly~~down compared to the year ago ~~quarter,~~ and ~~down from the~~ prior ~~quarter,~~quarters, which benefited from higher renewal income and prepayment benefits. Gross yield in Rail was down from the year-ago and prior quarters, reflecting lease rates that continued to re-price ~~lower, and the prior quarter benefited from a customer receivable settlement.~~lower. Year-to-date trends generally follow the trends and discussions compared to the year-ago quarter.

For total Consumer Banking, gross yield was up compared to the year-ago and prior quarters, and down compared to the ~~six~~nine months ended ~~June~~September 30, 2020. Within the Consumer and Community Banking division, gross yield was down compared to the year-ago quarter and ~~six~~nine months, as yields on new business have ~~contracted~~declined reflecting the lower market rate environment, partially offset by higher prepayment activity. ~~The increase for total Consumer Banking from~~Gross yield in LCM was up compared to the year-ago and prior ~~quarter reflects accelerated~~quarters, and compared to the nine-month period, primarily due to higher prepayment activity in respective periods contributing to higher PAA

accretion ~~income from higher prepayment activity in the LCM division.~~combined with lower average loan balances. NFM in Consumer and Community Banking was higher than gross yields as this segment receives an interest benefit from the other segments for the value of excess deposits it generates.

Gross yield in LCM was up compared to the year-ago and prior quarters, and compared to the six-month periods, primarily due to higher prepayment activity in respective periods contributing to higher PAA accretion.

The following table displays PAA accretion by segment and division for both interest income and interest expense. As of ~~June~~September 30, 2021, the remaining accretable PAA on loans was ~~$364~~$316.9 million, of which ~~$35~~$32.9 million related to Commercial Banking and ~~$329~~$284.0 million related to Consumer Banking. This compares to ~~$465~~$465.4 million of remaining accretable PAA on loans as of December 31, 2020, of which ~~$39~~$39.8 million related to Commercial Banking and ~~$426~~$425.6 million related to Consumer Banking. The remaining accretable PAA in Consumer Banking is expected to ~~decline as~~decrease due to the declining LCM loan ~~balances continue to run-off and~~balances. Similarly, we are expecting accretion of the remaining Commercial Banking PAA to continue to trend ~~lower.~~lower as well. However, amounts may vary quarter to quarter due to fluctuations in prepayments, which results in the acceleration of a loan's remaining accretable PAA ~~being accelerated~~ into interest income. (See footnote 1 to the following table).

	June 30, 2021								March 31, 2021								June 30, 2020								September 30, 2021								June 30, 2021								September 30, 2020
	PAA Accretion Recognized in:								PAA Accretion Recognized in:								PAA Accretion Recognized in:								PAA Accretion Recognized in:								PAA Accretion Recognized in:								PAA Accretion Recognized in:
	Interest Income⁽¹⁾			Interest Expense⁽²⁾		NFR			Interest Income⁽¹⁾			Interest Expense⁽²⁾		NFR			Interest Income⁽¹⁾			Interest Expense⁽²⁾		NFR			Interest Income⁽¹⁾			Interest Expense⁽²⁾		NFR			Interest Income⁽¹⁾			Interest Expense⁽²⁾		NFR			Interest Income⁽¹⁾			Interest Expense⁽²⁾		NFR
Commercial Banking
Commercial Finance	$	0.7		$	0.2	$	0.9		$	0.6		$	0.2	$	0.8		$	0.9		$	1.9	$	2.8		$	1.0		$	0.1	$	1.1		$	0.7		$	0.2	$	0.9		$	1.2		$	1.0	$	2.2
Real Estate Finance		1.9			-		1.9			1.3			-		1.3			3.2			-		3.2			1.3			—		1.3			1.9			—		1.9			2.0			—		2.0
Total Commercial Banking		2.6			0.2		2.8			1.9			0.2		2.1			4.1			1.9		6.0			2.3			0.1		2.4			2.6			0.2		2.8			3.2			1.0		4.2
Consumer Banking
Consumer and Community Banking		(1.0	)		0.3		(0.7	)		(1.5	)		0.4		(1.1	)		(3.5	)		2.0		(1.5	)		(0.7	)		0.3		(0.4	)		(1.0	)		0.3		(0.7	)		(1.9	)		1.3		(0.6	)
Legacy Consumer Mortgages		20.7			-		20.7			17.3			-		17.3			16.8			-		16.8			19.8			—		19.8			20.7			—		20.7			18.8			—		18.8
Total Consumer Banking		19.7			0.3		20.0			15.8			0.4		16.2			13.3			2.0		15.3			19.1			0.3		19.4			19.7			0.3		20.0			16.9			1.3		18.2
Total CIT	$	22.3		$	0.5	$	22.8		$	17.7		$	0.6	$	18.3		$	17.4		$	3.9	$	21.3		$	21.4		$	0.4	$	21.8		$	22.3		$	0.5	$	22.8		$	20.1		$	2.3	$	22.4

	Quarters Ended												Quarters Ended
	June 30, 2021				March 31, 2021				June 30, 2020				September 30, 2021				June 30, 2021				September 30, 2020
Rental income on operating leases	$	188.2	9.71	%	$	194.7	9.94	%	$	200.9	10.57	%	$	186.2	9.47	%	$	188.2	9.71	%	$	201.3	10.29	%
Depreciation on operating lease equipment		82.8	4.27	%		84.7	4.33	%		81.1	4.27	%		85.1	4.33	%		82.8	4.27	%		82.5	4.22	%
Maintenance and other operating lease expenses		54.8	2.83	%		51.6	2.64	%		56.1	2.95	%		50.5	2.57	%		54.8	2.83	%		48.6	2.48	%
Net operating lease revenue	$	50.6	2.61	%	$	58.4	2.98	%	$	63.7	3.35	%	$	50.6	2.57	%	$	50.6	2.61	%	$	70.2	3.59	%
Average operating lease equipment, including amounts held for sale	$	7,754.0			$	7,831.2			$	7,602.1			$	7,862.5			$	7,754.0			$	7,824.4


	Six Months Ended												Nine Months Ended
	June 30, 2021				June 30, 2020								September 30, 2021				September 30, 2020
Rental income on operating leases	$	382.9	9.83	%	$	410.7	10.94	%					$	569.1	9.71	%	$	612.0	10.72	%
Depreciation on operating lease equipment		167.5	4.30	%		159.4	4.25	%						252.6	4.31	%		241.9	4.24	%
Maintenance and other operating lease expenses		106.4	2.73	%		109.7	2.92	%						156.9	2.68	%		158.3	2.77	%
Net operating lease revenue	$	109.0	2.80	%	$	141.6	3.77	%					$	159.6	2.72	%	$	211.8	3.71	%
Average operating lease equipment, including amounts held for sale	$	7,792.4			$	7,509.1							$	7,816.0			$	7,615.0

Net operating lease revenue, which is a component of NFR, is driven principally by the performance of the Rail portfolio within the Commercial Banking segment. Although our rail portfolio grew, net operating lease revenue in dollars and as a percent of average operating lease equipment for the quarter and nine months ended ~~June~~September 30, 2021 was down from the year-ago ~~quarter and six months,~~periods, reflecting renewal rates that continued to re-price lower than the rates of maturing leases on average across the portfolio.

~~The lower net~~Net operating lease revenue compared to the prior quarter was ~~driven by a customer receivable settlement of $6 million that mostly benefited rental income last quarter, and also due to~~flat, reflecting lease renewal rates that on average re-priced at a lower but improving ~~rate. Railcar utilization, including commitments to lease, was 90% at June 30, 2021 up compared to 88% at March 31, 2021, and lease~~rate, offset by lower expenses. Lease renewals repriced down approximately ~~12%~~2% during the current quarter, ~~reflecting~~which was an improvement compared to the decline experienced in the prior quarter and reflects market conditions and the mix of cars that came up for renewal. Railcar utilization, including commitments to lease, improved to 91% at September 30, 2021 from 90% at June 30, 2021.

Depreciation, which is recognized on railcars and other operating lease equipment, ~~and was up~~increased from the year-ago quarter and ~~six~~nine months ~~on portfolio growth~~ and ~~down compared to~~ the prior ~~quarter.~~quarter reflecting portfolio growth. Maintenance and other operating lease expenses are variable and primarily relate to the Rail portfolio. The increase from last quarter reflects activity to move railcars out of storage and back onto lease, consistent with the improved utilization rate. The year-ago balance reflects preparing cars for storage.

The following provides information on the provision for credit losses, ~~and~~ allowance for credit losses (“ACL”), and allowance for off-balance sheet credit exposures, as well as certain credit metrics, including net charge-off and non-accrual loan levels, that management uses to track the credit quality of the portfolio. Management also utilizes other metrics and statistics such as risk ratings, concentration limits, migration trends, key portfolio stress testing, and LTV ratio and FICO scores on consumer mortgages, to monitor and manage the risk and credit quality of the portfolio. See Note 3 – Loans and Note 4 – Allowance for Credit Losses in Item 1 for various tables.

The provision for credit losses for the quarter ended September 30, 2021 was a benefit of ~~$72~~$67.1 million, ~~for~~while the year-ago quarter ~~ended June 30, 2021, compared to~~reflected a provision expense of ~~$224~~$63.3 million inand the ~~year-ago~~ prior quarter ~~and~~ included a benefit of ~~$117~~$72.2 million ~~in the prior quarter~~. The benefit for the quarter ended ~~June~~September 30, 2021 included ~~$67~~$49.3 million related to the Commercial Banking segment and $5$17.8 million in the Consumer Banking segment. The net provision benefit in the current quarter included approximately $72 million for the reduction in reserves (including ACL and allowance for off-balance sheet credit exposures), partially offset by $5.0 million of net charge-offs. The reduction in reserves compared to the prior quarter was due to lower loan balances, the continued improvement in credit trends, which are benefiting from CIT’s improved risk profile and disciplined underwriting standards, as well as the improvement in certain macroeconomic variable forecasts. The reduction in reserves included $40.9 million for loans collectively evaluated and $11.7 million for off-balance sheet credit exposures. The remaining decline of $19.3 million in the reserves related to loans that were individually evaluated.

The provision expense in the year-ago quarter of $63.3 million included the impact of the COVID-19 pandemic on the macroeconomic forecasts across our portfolios. The provision expense related to the Commercial Banking segment was $87.9 million, partially offset by a benefit of $24.6 million in the Consumer Banking segment. The net provision benefit in the prior quarter included an approximately $99 million reduction in reserves (including ACL and allowance for off-balance sheet credit exposures), partially offset by ~~$26~~$26.1 million of net charge-offs. The reduction in reserves included ~~an approximately $77~~a $76.6 million decline for loans collectively evaluated and for off-balance sheet credit ~~exposures which was due to lower loan balances and off-balance sheet credit exposures as well as continued improvement in credit trends and economic forecasts.~~exposures. The remaining decline of ~~$22~~$21.9 million in the reserves related to loans that were individually evaluated and largely offset the net charge-offs.

The provision in the year-ago quarter of $224 million included the impact of the COVID-19 pandemic on the macroeconomic forecasts across our portfolios. The provision related to the Commercial Banking segment was $215 million and the remaining $9 million related to the Consumer Banking segment. The benefit of $117 million in the prior quarter reflected a low level of net charge-offs ($13 million) and a reduction in reserve of approximately $130 million due to the continued improvement in the macroeconomic forecasts and credit trends, as well as lower loan balances.

Net charge-offs were ~~$26~~$5.0 million ~~(0.30%~~(0.06% of average loans) in the current quarter. Net charge-offs were down from ~~$170~~$66.0 million ~~(1.79%)~~(0.71% of average loans) in the year-ago quarter, ~~reflecting~~which reflected the impact from the COVID-19 pandemic and the associated effects on the ~~economy,~~economy. The decrease ~~and up~~ from ~~$13~~$26.1 million ~~(0.15%)~~(0.30% of average loans) in the prior ~~quarter. Net~~quarter, reflected a decline in net charge-offs in the ~~current quarter included a higher level~~Real Estate Finance division of ~~recoveries and accounts for which we had previously established a reserve. Net charge-offs are discussed and presented in a table by segment and division later in this section.~~Commercial Banking.

Non-accrual loans totaled ~~$549~~$404.9 million ~~(1.63%~~(1.21% of loans) at ~~June~~September 30, 2021, compared to ~~$588~~$588.1 million (1.63% of loans) at December 31, 2020. The decrease was ~~primarily~~driven by reductions in ~~Consumer Banking due to the sale of LCM~~ non-accrual loans across Commercial Banking portfolios as well as loan sales within Consumer Banking..

Net charge-offs and non-accrual loans are discussed and presented in subsequent tables by segment and divisions later in this section.

The following table presents details on our ACL, including charge-offs and recoveries and provides summarized components of the provision and allowance:

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Allowance - beginning of period	$	942.3		$	1,063.8		$	1,111.1		$	1,063.8		$	482.6		$	850.6		$	942.3		$	1,202.7		$	1,063.8		$	482.6
CIT CECL adoption⁽¹⁾		-			-			-			-			223.6			—			—			—			—			223.6
Provision for credit losses(2)		(72.2	)		(117.4	)		223.6			(189.6	)		737.5			(67.1	)		(72.2	)		63.3			(256.7	)		800.8
Other⁽²⁾		6.6			9.2			37.8			15.8			(37.8	)		11.9			6.6			6.2			27.7			(31.6	)
Net additions		(65.6	)		(108.2	)		261.4			(173.8	)		699.7			(55.2	)		(65.6	)		69.5			(229.0	)		769.2
The initial ACL recognized on PCD assets⁽³⁾		-			-			-			-			20.2			—			—			—			—			20.2
Gross charge-offs⁽³⁾		47.4			28.9			193.5			76.3			256.5			16.4			47.4			78.2			92.7			334.7
Less: Recoveries		21.3			15.6			23.7			36.9			33.1			11.4			21.3			12.2			48.3			45.3
Net charge-offs		26.1			13.3			169.8			39.4			223.4			5.0			26.1			66.0			44.4			289.4
Allowance - end of period	$	850.6		$	942.3		$	1,202.7		$	850.6		$	1,202.7		$	790.4		$	850.6		$	1,206.2		$	790.4		$	1,206.2
Provision for credit losses
Provision for loans individually reviewed	$	1.6		$	14.0		$	48.1		$	15.6		$	95.8		$	(18.5	)	$	1.6		$	36.0		$	(2.9	)	$	131.8
Provision for loans collectively reviewed		(73.8	)		(131.4	)		175.5			(205.2	)		641.7			(48.6	)		(73.8	)		27.3			(253.8	)		669.0
Total	$	(72.2	)	$	(117.4	)	$	223.6		$	(189.6	)	$	737.5		$	(67.1	)	$	(72.2	)	$	63.3		$	(256.7	)	$	800.8
Allowance for credit losses
Allowance on loans individually reviewed	$	91.6		$	113.5		$	109.7								$	72.3		$	91.6		$	128.1
Allowance on loans collectively reviewed		759.0			828.8			1,093.0									718.1			759.0			1,078.1
Total	$	850.6		$	942.3		$	1,202.7								$	790.4		$	850.6		$	1,206.2
Ratio
ACL as a percentage of total loans		2.52	%		2.70	%		3.21	%								2.36	%		2.52	%		3.23	%
ACL as a percentage of total loans/Commercial Banking loans		2.73	%		2.95	%		3.52	%								2.58	%		2.73	%		3.59	%
ACL as a percentage of total loans/Consumer Banking loans		1.66	%		1.66	%		2.14	%								1.43	%		1.66	%		1.94	%

In ~~the second quarter of~~ 2021, the allowance for off-balance sheet credit exposures decreased to ~~$62~~$50.1 million from ~~$78~~$78.3 million at December 31, 2020, largely due to a reduction in the off-balance sheet credit exposures, as well as an improvement in the macroeconomic forecast. ~~The allowance for off-balance sheet credit exposures of $81 million at June 30, 2020 was primarily driven by the impact of the COVID-19 pandemic and the associated effect under the CECL standard.~~

	Loans		Allowance for Credit Losses			Net Carrying Value		Loans		Allowance for Credit Losses			Net Carrying Value
June 30, 2021
September 30, 2021
Commercial Banking	$	27,265.9	$	(743.4	)	$	26,522.5	$	27,217.1	$	(701.2	)	$	26,515.9
Consumer Banking		6,445.2		(107.2	)		6,338.0		6,243.9		(89.2	)		6,154.7
Total	$	33,711.1	$	(850.6	)	$	32,860.5	$	33,461.0	$	(790.4	)	$	32,670.6
December 31, 2020
Commercial Banking	$	28,636.5	$	(933.7	)	$	27,702.8	$	28,636.5	$	(933.7	)	$	27,702.8
Consumer Banking		7,508.1		(130.1	)		7,378.0		7,508.1		(130.1	)		7,378.0
Total	$	36,144.6	$	(1,063.8	)	$	35,080.8	$	36,144.6	$	(1,063.8	)	$	35,080.8

The following table presents charge-offs, by class and business segment. See Results by Business Segment for additional information.

	Quarters Ended													Six Months Ended								Quarters Ended													Nine Months Ended
	June 30,				March 31,				June 30,					June 30,				June 30,				September 30,				June 30,				September 30,					September 30,				September 30,
	2021				2021				2020					2021				2020				2021				2021				2020					2021				2020
Gross Charge-offs
Commercial Finance	$	12.6	0.31	%	$	8.0	0.20	%	$	149.5		3.57	%	$	20.6	0.25	%	$	183.0	2.20	%	$	1.6	0.04	%	$	12.6	0.31	%	$	48.2		1.17	%	$	22.2	0.18	%	$	231.2	1.86	%
Business Capital		15.4	1.33	%		17.8	1.52	%		43.5		3.50	%		33.2	1.43	%		70.8	2.84	%		13.7	1.19	%		15.4	1.33	%		29.0		2.37	%		46.9	1.35	%		99.8	2.68	%
Real Estate Finance		17.1	0.99	%		-	-	%		-		-	%		17.1	0.48	%		-	-	%		—	—	%		17.1	0.99	%		—		—	%		17.1	0.33	%		—	—	%
Commercial Banking		45.1	0.65	%		25.8	0.37	%		193.0		2.63	%		70.9	0.51	%		253.8	1.73	%		15.3	0.23	%		45.1	0.65	%		77.2		1.06	%		86.2	0.41	%		331.0	1.51	%
Consumer and Community Banking		0.3	0.03	%		0.3	0.02	%		-		-	%		0.6	0.02	%		-	-	%		0.1	0.01	%		0.3	0.03	%		0.2		0.01	%		0.7	0.02	%		0.2	—	%
Legacy Consumer Mortgages		2.0	0.52	%		2.8	0.70	%		0.5		0.10	%		4.8	0.61	%		2.7	0.25	%		1.0	0.32	%		2.0	0.52	%		0.8		0.15	%		5.8	0.52	%		3.5	0.23	%
Consumer Banking		2.3	0.13	%		3.1	0.17	%		0.5		0.02	%		5.4	0.15	%		2.7	0.06	%		1.1	0.07	%		2.3	0.13	%		1.0		0.05	%		6.5	0.13	%		3.7	0.06	%
Total	$	47.4	0.55	%	$	28.9	0.33	%	$	193.5		2.04	%	$	76.3	0.44	%	$	256.5	1.35	%	$	16.4	0.20	%	$	47.4	0.55	%	$	78.2		0.84	%	$	92.7	0.36	%	$	334.7	1.18	%
Less: Recoveries
Commercial Finance	$	11.1	0.27	%	$	7.9	0.20	%	$	13.1		0.31	%	$	19.0	0.23	%	$	15.3	0.18	%	$	1.3	0.03	%	$	11.1	0.27	%	$	1.6		0.03	%	$	20.3	0.16	%	$	16.9	0.13	%
Business Capital		9.2	0.80	%		7.2	0.62	%		10.0		0.80	%		16.4	0.71	%		16.8	0.68	%		9.4	0.81	%		9.2	0.80	%		9.8		0.79	%		25.8	0.74	%		26.6	0.71	%
Commercial Banking		20.3	0.29	%		15.1	0.22	%		23.1		0.32	%		35.4	0.26	%		32.1	0.22	%		10.7	0.16	%		20.3	0.29	%		11.4		0.15	%		46.1	0.22	%		43.5	0.20	%
Legacy Consumer Mortgages		1.0	0.24	%		0.5	0.14	%		0.6		0.13	%		1.5	0.18	%		1.0	0.09	%		0.7	0.25	%		1.0	0.24	%		0.8		0.15	%		2.2	0.19	%		1.8	0.12	%
Consumer Banking		1.0	0.05	%		0.5	0.03	%		0.6		0.03	%		1.5	0.04	%		1.0	0.02	%		0.7	0.05	%		1.0	0.05	%		0.8		0.04	%		2.2	0.04	%		1.8	0.03	%
Total	$	21.3	0.25	%	$	15.6	0.18	%	$	23.7		0.25	%	$	36.9	0.21	%	$	33.1	0.17	%	$	11.4	0.14	%	$	21.3	0.25	%	$	12.2		0.13	%	$	48.3	0.19	%	$	45.3	0.16	%
Net Charge-offs
Commercial Finance	$	1.5	0.04	%	$	0.1	-	%	$	136.4		3.26	%	$	1.6	0.02	%	$	167.7	2.02	%	$	0.3	0.01	%	$	1.5	0.04	%	$	46.6		1.14	%	$	1.9	0.02	%	$	214.3	1.73	%
Business Capital		6.2	0.53	%		10.6	0.90	%		33.5		2.70	%		16.8	0.72	%		54.0	2.16	%		4.3	0.38	%		6.2	0.53	%		19.2		1.58	%		21.1	0.61	%		73.2	1.97	%
Real Estate Finance		17.1	0.99	%		-	-	%		-		-	%		17.1	0.48	%		-	-	%		—	—	%		17.1	0.99	%		—		—	%		17.1	0.33	%		—	—	%
Commercial Banking		24.8	0.36	%		10.7	0.15	%		169.9		2.31	%		35.5	0.25	%		221.7	1.51	%		4.6	0.07	%		24.8	0.36	%		65.8		0.91	%		40.1	0.19	%		287.5	1.31	%
Consumer and Community Banking		0.3	0.03	%		0.3	0.02	%		-		-	%		0.6	0.02	%		-	-	%		0.1	0.01	%		0.3	0.03	%		0.2		0.01	%		0.7	0.02	%		0.2	—	%
Legacy Consumer Mortgages		1.0	0.28	%		2.3	0.56	%		(0.1	)	(0.03	%)		3.3	0.43	%		1.7	0.16	%		0.3	0.07	%		1.0	0.28	%		(0.0	)	—	%		3.6	0.33	%		1.7	0.11	%
Consumer Banking		1.3	0.08	%		2.6	0.14	%		(0.1	)	(0.01	%)		3.9	0.11	%		1.7	0.04	%		0.4	0.02	%		1.3	0.08	%		0.2		0.01	%		4.3	0.09	%		1.9	0.03	%
Total	$	26.1	0.30	%	$	13.3	0.15	%	$	169.8		1.79	%	$	39.4	0.23	%	$	223.4	1.18	%	$	5.0	0.06	%	$	26.1	0.30	%	$	66.0		0.71	%	$	44.4	0.17	%	$	289.4	1.02	%

Gross and net charge-offs were down compared to the year-ago quarter and ~~six~~nine months. The year-ago periods were impacted by the COVID-19 pandemic and the associated effects on the economy. Compared to the prior quarter, the decline reflected lower charge-offs in Real Estate Finance~~Charge-offs included higher recoveries from previously charged off accounts and accounts for which we had previously established a reserve.~~.

The following tables present information on non-accruing loans, ~~and~~which when added to other real estate owned (“OREO”) and other repossessed assets, sums to non-performing assets. See Note 3 —– Loans in Item 1 for details on the Company’s non-performing assets.

Segment Non-accrual Loans as a Percentage of Loans (dollars in millions)⁽¹⁾⁽²⁾

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
Commercial Finance	$	277.6	1.74	%	$	239.4	1.47	%	$	225.3	1.40	%	$	239.4	1.47	%
Business Capital		60.2	1.29	%		72.8	1.52	%		40.8	0.88	%		72.8	1.52	%
Real Estate Finance		79.3	1.21	%		83.2	1.10	%		63.4	0.99	%		83.2	1.10	%
Commercial Banking		417.1	1.53	%		395.4	1.38	%		329.5	1.21	%		395.4	1.38	%
Consumer and Community Banking		73.1	1.44	%		53.4	0.92	%		52.1	1.03	%		53.4	0.92	%
Legacy Consumer Mortgages		58.8	4.31	%		139.3	8.22	%		23.3	1.94	%		139.3	8.22	%
Consumer Banking		131.9	2.05	%		192.7	2.57	%		75.4	1.21	%		192.7	2.57	%
Total	$	549.0	1.63	%	$	588.1	1.63	%	$	404.9	1.21	%	$	588.1	1.63	%

Non-accrual loans decreased ~~$39~~$183.2 million from December 31, 2020, primarily driven by the LCM division reflecting lower balance ~~in LCM. During the second quarter of 2021, LCM~~due to loan sales, included $80 million of loans on non-accrual at March 31, 2021. Although placed on non-accrual, the majority of the loans are residential mortgages with strong loan-to-value ratios and are therefore not expected to result in significant losses.as well as improved payment performance. The ~~increase~~decline in Commercial ~~Finance was driven by loans in~~Banking reflects the ~~power~~combination of accounts being repaid and ~~energy vertical.~~others being returned to accrual status based on improved performance.

As of ~~June~~September 30, 2021, and December 31, 2020, the ACL as a percentage of non-accrual loans was ~~155%~~195% and 181%, respectively. ~~68%~~76% of our non-accrual accounts were paying current at ~~June~~September 30, 2021, compared to 50% at December 31, 2020. We discuss our policy of placing loans on non-accrual status in Note 1 – Business and Summary of Significant Accounting Policies in the 2020 Form 10-K. We may place accounts that are presently paying current on non-accrual status when the financial condition of the borrower deteriorates and payment in full is not expected.

Total delinquency (30 days or more) was ~~1.5%~~1.0% of loans at ~~June~~September 30, 2021 and 2.6% at December 31, 2020. Delinquency status of loans is presented in Note 3 —– Loans in Item 1. We present a delinquency table specific to ~~exited~~ COVID-19 loans that were provided relief and subsequently exited deferral status in the COVID-19 Borrower Relief Arrangements section below.

The following table presents a summary of total commercial criticized loans. Detailed definitions of the commercial loan ratings and a detailed table are provided in Note 3 – Loans in Item 1.


	June 30,	December 31,	June 30,	September 30,	December 31,	September 30,
	2021	2020	2020	2021	2020	2020
Total commercial criticized loans	$ 3,805.3	$ 4,433.1	$ 4,598.8	$ 3,486.0	$ 4,433.1	$ 4,506.5
As a % of total commercial loans	13.5%	14.9%	15.3%	12.4%	14.9%	14.9%

Commercial criticized loans decreased by ~~$628~~$947.1 million from December 31, 2020, ~~primarily~~ reflecting improved credit performance, sales and paydowns. Of the ~~$628 million~~ decrease from December 31, 2020, ~~$266~~$492 million reduction related to Commercial Finance, ~~$244~~$278.4 million reduction related to Real Estate Finance and ~~$140~~$176.8 million reduction related to Business ~~Capital, partially offset by a $22 million increase in SBA loans in Consumer and Community Banking.~~Capital.

CIT is working prudently with borrowers who are or may be unable to meet their current contractual payment obligations because of the effects of COVID-19. Refer to the tables below for a summary of the key data points related to the COVID-19 loan modifications.

Included within Title I of the CARES Act, as amended, was a provision for SBA funding of small business loans through the Paycheck Protection Program (“PPP”) for small businesses to keep their employees paid during the COVID-19 pandemic, with applications accepted through August 8, 2020. PPP loans are guaranteed by the SBA and are forgivable, in whole or in part, if the proceeds are used for payroll and other permitted purposes in accordance with the requirements of the PPP. The PPP loan balance at ~~June~~September 30, 2021 was ~~$84~~$22 million, down from $~~202~~84 million at ~~March~~June 30, 2021 and $251 million at December 31, ~~2021,~~2020, primarily due to ~~$118 million of~~ forgiveness payments from the ~~SBA during the second quarter.~~SBA. See our more detailed disclosure in our 2020 Form 10-K.

Loan modifications ~~related to~~approved for COVID-19 impacted borrowers totaled ~~$563~~$591 million at ~~June~~September 30, 2021, ~~including deferments of $241 million~~which included deferment and other modifications, such as covenant relief, ~~of $322 million~~ compared to $705 million ~~$458 million and $247 million, respectively,~~ at December 31, 2020. The ~~loan~~ ~~deferments reflect those approved for~~ COVID-19 ~~impacted borrowers with balances as of~~ ~~June 30, 2021~~loan modifications ~~and December 31, 2020, which~~ were not identified as TDRs due to the practicality exemption provided by the Interagency guidance or, if applicable, the CARES Act.

~~There were $4~~At September 30, 2021 there was $60 million of new initial ~~deferments~~COVID-19 loan modifications granted during the ~~second~~ third quarter, ~~representing 16~~$58 million represented two real estate contracts ~~all~~in Commercial Banking and $2 million related to nine Consumer Banking contracts.

The table below presents the delinquency status of ~~which were in Consumer Banking.~~ ~~Initial deferments represent new accounts that entered a deferment period during the second quarter in 2021 and had a balance~~loans with remaining balances at ~~June~~September 30, 2021~~. During~~ that have exited their COVID-19 loan modification period, regardless of accrual / non-accrual classification, and of the ~~second quarter, there~~total, the amount on non-accrual status. Not included in the following tables were ~~53 contracts ($43 million) for which~~approximately $850 million of exited COVID-19 ~~impacted borrowers extended for a second deferment period.~~loan modifications that had paid off or been sold, and approximately $20 million that were charged off.

COVID-19 ~~Loans Deferments~~Loan Modifications Delinquency Status at September 30, 2021 (dollars in millions)

	Loan Deferments Exited⁽¹⁾														COVID-19 Loan Modifications Exited⁽¹⁾
	30-59		60-89		90 or more		Total Past Due		Current		Total		Non-Accrual		30-59		60-89		90 or more		Total Past Due		Current		Total		Non-Accrual
Commercial Banking	$	9	$	71	$	27	$	107	$	803	$	910	$	51	$	26	$	8	$	6	$	40	$	892	$	932	$	73
Consumer Banking		18		11		41		70		538		608		73		14		5		20		39		478		517		33
Total CIT	$	27	$	82	$	68	$	177	$	1,341	$	1,518	$	124	$	40	$	13	$	26	$	79	$	1,370	$	1,449	$	106

The total past due loans ~~with COVID-19 deferments~~ that have exited ~~deferment~~COVID-19 modifications status of approximately ~~$177~~$79 million represents ~~36%~~23% of the Company's total past due loans and ~~0.5%~~0.24% of total loans. Of the ~~$124~~$106 million of non-accrual ~~loan deferments,~~loans that were COVID-19 modified loans, approximately ~~38%~~60% were paying current.

As discussed in Note 1 – Business and Summary of Significant accounting Policies in Item 1, loans with deferments granted in response to the COVID-19 pandemic will generally continue to accrue interest during the deferral ~~period, with a reserve established for amounts deemed potentially uncollectible.~~period. As of ~~June~~September 30, 2021, the accrued and unpaid interest within other assets related to loans that have or had COVID-19 related deferments (i.e. active deferment or exited) were approximately ~~$7 million and amounts charged-off through the provision for credit losses during the quarter were not significant.~~$3 million. Rentals on operating leases will continue to accrue until such time that it is determined that collection of the rental payments is no longer probable. Accrued rentals on operating leases related to accounts with COVID-19 related modifications were approximately $4$3 million at ~~June~~September 30, 2021.

With respect to the non-accrual, past due and TDR information provided throughout this section, see discussion of the CARES Act and Interagency Statement in Note 1 – Business and Summary of Significant Accounting Policies in Item 1.

The tables that follow reflect loan carrying values of accounts that have been modified, excluding loans in trial modification of ~~$0.5~~$0.1 million and $4.5 million as of ~~June~~September 30, 2021 and December 31, 2020, respectively. The table also excludes modifications made for qualifying COVID-19 impacted ~~borrowers.~~borrowers under the exemptions provided by the Interagency guidance or, if applicable, the CARES Act. See tables above for further details.

	June 30, 2021						December 31, 2020						September 30, 2021						December 31, 2020
				% Compliant						% Compliant						% Compliant						% Compliant
Troubled Debt Restructurings
Deferral of principal and/or interest	$	54.6			95	%	$	53.7			95	%	$	71.4			70	%	$	53.7			95	%
Covenant relief and other		66.1			79	%		80.7			80	%		58.1			84	%		80.7			80	%
Total TDRs	$	120.7			86	%	$	134.4			86	%	$	129.5			76	%	$	134.4			86	%
Percent TDRs on non-accrual		77	%					73	%
Percent non-accrual														51	%					73	%
Modifications⁽³⁾
Covenant relief	$	110.9			100	%	$	87.2			91	%	$	137.2			100	%	$	87.2			91	%
Interest rate increase		208.1			94	%		219.4			94	%		197.4			94	%		219.4			94	%
Extended maturity		140.0			95	%		122.7			89	%		179.7			98	%		122.7			89	%
Other		653.3			93	%		521.2			90	%		540.2			97	%		521.2			90	%
Total Modifications	$	1,112.3			94	%	$	950.5			91	%	$	1,054.5			97	%	$	950.5			91	%
Percent Modifications on non-accrual		18	%					16	%
Percent non-accrual														22	%					16	%

TDRs and other credit quality information is included in Note 3 —– Loans in Item 1.

	Quarters Ended							Six Months Ended					Quarters Ended						Nine Months Ended
	June 30,		March 31,			June 30,		June 30,			June 30,		September 30,		June 30,		September 30,		September 30,			September 30,
	2021		2021			2020		2021			2020		2021		2021		2020		2021			2020
Rental income on operating leases	$	188.2	$	194.7		$	200.9	$	382.9		$	410.7	$	186.2	$	188.2	$	201.3	$	569.1		$	612.0
Other non-interest income		160.7		229.9			102.6		390.6			233.2		124.7		160.7		146.0		515.3			379.2
Total non-interest income	$	348.9	$	424.6		$	303.5	$	773.5		$	643.9	$	310.9	$	348.9	$	347.3	$	1,084.4		$	991.2
Other non-interest income
Gains on investment securities	$	3.7	$	104.7		$	7.9	$	108.4		$	21.4	$	5.5	$	3.7	$	8.3	$	113.9		$	29.7
Fee income		36.2		29.5			30.3		65.7			64.2		32.7		36.2		32.6		98.4			96.8
Factoring commissions														28.3		26.6		19.8		78.8			54.1
Gains on leasing equipment, net of impairments		29.1		28.0			20.5		57.1			43.8		20.7		29.1		24.3		77.8			68.1
Factoring commissions		26.6		23.9			11.3		50.5			34.3
BOLI income		8.2		8.1			8.1		16.3			15.7		8.3		8.2		15.7		24.6			31.4
Property tax income		3.9		4.1			4.7		8.0			9.3		3.5		3.9		4.0		11.5			13.3
Other income		53.0		31.6			19.8		84.6			44.5		25.7		53.0		41.3		110.3			85.8
Total other non-interest income	$	160.7	$	229.9		$	102.6	$	390.6		$	233.2	$	124.7	$	160.7	$	146.0	$	515.3		$	379.2
Noteworthy items⁽¹⁾		-		(83.0	)		-		(83.0	)		-		13.2		—		—		(69.8	)		—
Total other non-interest income, excluding noteworthy items⁽²⁾	$	160.7	$	146.9		$	102.6	$	307.6		$	233.2	$	137.9	$	160.7	$	146.0	$	445.5		$	379.2
Factoring volume	$	6,056.0	$	5,826.9		$	2,990.1	$	11,882.9		$	9,070.9	$	6,871.6	$	6,056.0	$	5,880.1	$	18,754.5		$	14,951.0

Rental income on operating leases from equipment we lease is generated in the Rail, Commercial Finance and Business Capital divisions in the Commercial Banking segment. Rental income is discussed in “Net Finance ~~Revenue”~~Revenue and “Results by Business ~~Segment”~~Segment.

For the quarter ended ~~June~~September 30, 2021, other non-interest income ~~increased by $58.1 million~~decreased compared to the year-ago ~~quarter, driven by~~quarter. Some of the drivers included lower gains on ~~loan sales~~investment securities and leasing equipment and lower BOLI income, which offset higher factoring commissions. ~~Other~~Gains on investment securities and leasing equipment were down $6.4 million. See tables in the Loans and Leases section, which include amounts of loans and equipment sold by segment. BOLI income ~~for~~in the year-ago quarter ~~ended June 30, 2021~~ included ~~approximately $34 million net gain on sale of LCM loans in Consumer Banking and $8 million gain from the sale of the Aviation Lending portfolio in Commercial Banking.~~elevated insurance payouts. The increase in factoring commissions reflected higher factoring volumes and surcharges from the year-ago quarter, which was ~~significantly~~ impacted by the global pandemic from the spread of the COVID-19 virus and the ensuing adverse impact on the macroeconomic environment. The ~~increase also included higher gains on the sale of leasing equipment, primarily rail assets. See tables~~noteworthy item in the ~~Loans and Leases~~ ~~section,~~current quarter, which ~~include amounts~~reduced the other income line, reflected a CTA release related to the liquidation of ~~loans and equipment sold by segment.~~ a foreign entity.

The increase of other non-interest income for the ~~prior quarter and the six~~nine months ended ~~June~~September 30, 2021 ~~also~~ reflected ~~the $83~~$104.7 million ~~noteworthy item~~ of gains on sales of investment securities related to our strategic initiative to monetize unrealized gains on investment securities in AOCI in the Corporate ~~segment. Of the total pre-tax gains on investment securities~~segment, of ~~$104.7 million in the prior quarter, $83~~which $83.0 million was considered a noteworthy item.

~~Other non-interest income was down from~~ Also driving the ~~prior quarter, which included the noteworthy item related to gains on investment sales noted above. Excluding the noteworthy item, the $13.8 million~~year-to-date increase ~~reflects higher capital markets fees,~~were higher factoring commissions ~~from higher volume, higher other income from~~and gains on loan sales ~~as noted above, partially offset by lower gains on investment securities.~~(in other income).

Other non-interest income was down from the prior quarter. The decrease reflects lower other income, which included the noteworthy item and a decline of $5 million of net gains on sales of approximately $29 million of consumer mortgage loans, primarily from the LCM division, while the prior quarter included an $8 million gain from the sale of the Aviation Lending portfolio in Commercial Banking. Also driving the decline were lower gains on equipment sales.

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Depreciation on operating lease equipment	$	82.8		$	84.7		$	81.1		$	167.5		$	159.4		$	85.1		$	82.8		$	82.5		$	252.6		$	241.9
Maintenance and other operating lease expenses		54.8			51.6			56.1			106.4			109.7			50.5			54.8			48.6			156.9			158.3
Operating expenses		251.2			274.0			360.4			525.2			694.8			268.2			251.2			295.5			793.4			990.3
Goodwill impairment		-			-			-			-			344.7			—			—			—			—			344.7
Loss on debt extinguishments and deposit redemptions		-			0.1			(14.8	)		0.1			(14.8	)		—			—			—			0.1			(14.8	)
Total non-interest expenses	$	388.8		$	410.4		$	482.8		$	799.2		$	1,293.8		$	403.8		$	388.8		$	426.6		$	1,203.0		$	1,720.4
Operating expenses
Compensation and benefits	$	148.6		$	155.0		$	166.0		$	303.6		$	348.1		$	153.0		$	148.6		$	148.6		$	456.6		$	496.7
Technology		33.4			33.4			42.7			66.8			81.5			32.4			33.4			39.4			99.2			120.9
Net occupancy expense																	17.1			16.3			19.7			51.1			58.8
Professional fees		21.2			13.9			29.7			35.1			54.6			10.6			21.2			22.2			45.7			76.8
Net occupancy expense		16.3			17.7			20.2			34.0			39.1
Insurance		14.1			14.9			16.9			29.0			30.2			13.9			14.1			25.3			42.9			55.5
Intangible asset amortization		8.3			8.4			8.5			16.7			17.0			8.1			8.3			8.5			24.8			25.5
Advertising and marketing																	5.8			5.0			4.8			14.3			30.3
Property tax expense		4.4			4.4			4.8			8.8			9.6			3.9			4.4			4.8			12.7			14.4
Advertising and marketing		5.0			3.5			8.9			8.5			25.5
Restructuring costs		(7.9	)		-			37.2			(7.9	)		37.2			—			(7.9	)		—			(7.9	)		37.2
Other expenses		7.8			22.8			25.5			30.6			52.0			23.4			7.8			22.2			54.0			74.2
Total operating expenses		251.2			274.0			360.4			525.2			694.8		$	268.2		$	251.2		$	295.5		$	793.4		$	990.3
Intangible asset amortization		8.3			8.4			8.5			16.7			17.0			8.1			8.3			8.5			24.8			25.5
Noteworthy items		(6.2	)		6.9			57.1			0.7			74.2			0.7			(6.2	)		0.5			1.4			74.7
Total operating expenses, excluding intangible amortization and noteworthy items⁽¹⁾	$	249.1		$	258.7		$	294.8		$	507.8		$	603.6		$	259.4		$	249.1		$	286.5		$	767.2		$	890.1
Headcount, actuals		3,914			4,048			4,325			3,914			4,325			3,812			3,914			4,260			3,812			4,260
Net efficiency ratio⁽²⁾		52.5	%		47.7	%		76.6	%		49.9	%		70.6	%		60.2	%		52.5	%		60.6	%		53.0	%		67.2	%
Net efficiency ratio excluding intangible amortization and noteworthy items⁽²⁾		52.2	%		54.6	%		71.8	%		53.4	%		66.6	%		58.3	%		52.2	%		60.4	%		54.9	%		64.5	%

Depreciation expense is driven by rail equipment and other small and large ticket equipment, in the Rail, Business Capital and Commercial Finance divisions in Commercial Banking.

Maintenance and other operating lease expenses relate to equipment ownership and leasing costs associated with the Rail portfolio and tend to be variable. Rail provides railcars primarily pursuant to full-service lease contracts under which Rail as lessor is responsible for railcar maintenance and repair.

Depreciation, along with Maintenance and Other Operating Lease Expenses, are components of NFR and discussed in the Net Finance Revenue section.

Operating expenses in the current quarter were down from the ~~quarters~~year-ago quarter and up from the quarter ended June 30, ~~2020 and March 31,~~ 2021. Each of the quarters include noteworthy items. Noteworthy items in the quarters ended September 30, 2021 and June 30, 2021 ~~and March 31, 2021 were~~included merger costs related to FCB of ~~$1.7~~$0.7 million and ~~$6.9~~$1.7 million, respectively. The FCB merger costs are presented in a table below. ~~The current~~In addition, the prior quarter ~~also~~noteworthy items included a net benefit from reversal of previously recorded restructuring charges of $7.9 million. The year-ago quarter included two noteworthy items that essentially offset each other. These were MOB merger and integration costs of $12.6 million and a ~~noteworthy item~~reversal of $12.1 million of preferred stock units (“PSU”) compensation expenses due to the decrease in probability of achieving performance conditions related to ~~MOB integration costs and a restructuring charge.~~the Company’s stock-based compensation reflecting the change in market conditions. (See table below for line item impacts due to merger and

Operating expenses, excluding noteworthy items and intangible asset amortization were down ~~by $45.7~~$27.0 million compared to the year-ago quarter and ~~$95.8~~down $122.8 million compared to the ~~six~~nine months ended ~~June~~September 30, 2020. Driving the decline compared to the year-ago quarter were lower professional fees and deposit insurance costs. The year-to-date decline ~~includes~~also included lower compensation and benefits, reflecting the decrease in ~~headcount.~~headcount, and lower advertising and marketing costs, mostly related to our Direct Bank deposit gathering activity. The ~~declines~~lower operating expenses also reflect cost reduction initiatives, including the recognition of cost synergies from our MOB ~~acquisition,~~acquisition.

Operating expenses excluding intangible asset amortization and noteworthy items were up by $10.4 million compared to the prior quarter, as ~~well as lower advertising and marketing costs, mostly related to our Direct Bank deposit gathering activity. In addition,~~ the ~~current~~prior quarter benefited from a reserve release related to indemnification obligations for prior divestitures ~~which is~~ included in other ~~expenses.~~

~~Operating~~ expenses, ~~excluding intangible asset amortization and noteworthy items were down by $9.6 million compared to the~~

~~prior quarter as the noted decline in other expenses and lower compensation and benefits, due to lower headcount and the prior quarter’s higher annual benefit restarts,~~which was partially offset by ~~an increase~~higher legal costs. Other changes included a decline in ~~legal costs within~~ professional ~~fees.~~fees, and higher incentive compensation and retirement benefit accruals to retain talent.

The noteworthy items in the following table for ~~June 30 and March 31,~~ 2021 periods relate to the FCB merger. 2020 includes only MOB Acquisition merger and integration costs.

	Quarters Ended						Six Months Ended				Quarters Ended						Nine Months Ended
	June 30,		March 31,		June 30,		June 30,		June 30,		September 30,		June 30,		September 30,		September 30,		September 30,
	2021		2021		2020		2021		2020		2021		2021		2020		2021		2020
Operating expenses
Compensation and benefits	$	-	$	-	$	2.1	$	-	$	6.6	$	—	$	—	$	4.6	$	—	$	11.2
Technology		1.6		0.1		4.6		1.7		7.7		0.7		1.6		4.6		2.4		12.3
Professional fees		0.1		6.8		10.8		6.9		17.7		—		0.1		3.4		6.9		21.1
Advertising and marketing		-		-		2.3		-		4.6		—		—		—		—		4.6
Other expenses		-		-		0.1		-		0.4		—		—		—		—		0.4
Noteworthy items	$	1.7	$	6.9	$	19.9	$	8.6	$	37.0	$	0.7	$	1.7	$	12.6	$	9.3	$	49.6

The net efficiency ratio was ~~52.5%~~60.2% in the current quarter compared to ~~76.6%~~60.6% in the year-ago quarter and ~~47.7%~~52.5% in the prior quarter. The net efficiency ratio excluding noteworthy items and intangible asset amortization was ~~52.2%~~58.8% compared to ~~71.8%~~60.4% in the year-ago quarter and ~~54.6%~~52.2% in the prior quarter. The improvement from the year-ago ~~and prior quarters~~ was driven by the lower operating expenses, which offset the decline in total net revenues. Compared to the prior quarter, the increase was due to the noted higher operating expenses and ~~higher total~~lower net revenues.

The deterioration of the macroeconomic environment triggered goodwill impairment assessments that resulted in impairments in 2020.

The effective tax rate (“ETR”) was 24.0% in the current quarter, compared to ~~24.1%~~24.0% and ~~46.2%~~25.6% in the prior and year-ago quarters, respectively, and 24.0% for the ~~six~~nine months ended ~~June~~September 30, 2021, compared to ~~17.0%~~15.7% for the ~~six~~nine months ended ~~June~~September 30, 2020. Included in the tax on noteworthy items in the current quarter and year-to-date balances is $2.3 million that relates to the reduction in the tax benefit associated with the CTA release related to the liquidation of the remaining investment in a foreign entity, as the benefit was recognized in a prior year as required under ASC 740.

The ETR before noteworthy and tax discrete ~~tax~~ items was ~~25.4%~~25.2% in the current quarter, compared to ~~25.9%~~25.4% and ~~52.7%~~26.0% in the prior and year-ago quarters, respectively, and ~~25.7%~~25.5% for the ~~six~~nine months ended ~~June~~September 30, 2021, compared to ~~27.0%~~27.4% for the ~~six months ended June 30, 2020.~~year-ago period.

The ETR before noteworthy and tax discrete ~~and noteworthy~~ items in the current quarter compared to the prior quarter remains essentially unchanged. The ETR before noteworthy and tax discrete ~~and noteworthy~~ items was lower in the current quarter and ~~six~~nine months compared to the year ago periods primarily due to the effect that the change in forecasted pre-tax income has on the permanent and other adjustments.

The ETR each quarter was impacted by a number of factors, including tax discrete items, the relative mix of domestic and

international earnings, effects of changes infrom enacted tax laws, and adjustments to valuation ~~allowances, and discrete items.~~allowances. The future period’s ETR may vary due to changes in these factors.

CIT manages its business and reports its financial results in two operating segments, Commercial Banking and Consumer Banking, and a non-operating segment, Corporate. Detailed descriptions of the divisions within Commercial Banking and Consumer Banking are included in Item 1. Business Overview of our 2020 Form 10-K. See Net Finance Revenue, Non-Interest Income, Non-Interest Expenses and Credit Metrics, which reference the segments on these topics.

Commercial Banking is comprised of four divisions: Commercial Finance, Rail, Real Estate Finance and Business Capital. Revenue is generated from interest earned on loans, rents on equipment leased, fees and other revenue from lending and leasing activities and banking services, along with capital markets transactions and commissions earned on factoring and related activities. HOA deposits are included in Commercial Banking.

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
Earnings Summary	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Interest income	$	281.1		$	291.1		$	324.5		$	572.2		$	692.4		$	269.8		$	281.1		$	306.7		$	842.0		$	999.1
Rental income on operating leases		188.2			194.7			200.9			382.9			410.7			186.2			188.2			201.3			569.1			612.0
Finance revenue		469.3			485.8			525.4			955.1			1,103.1			456.0			469.3			508.0			1,411.1			1,611.1
Interest expense		77.5			88.7			135.5			166.2			299.0			69.8			77.5			105.3			236.0			404.3
Depreciation on operating lease equipment		82.8			84.7			81.1			167.5			159.4			85.1			82.8			82.5			252.6			241.9
Maintenance and other operating lease expenses		54.8			51.6			56.1			106.4			109.7			50.5			54.8			48.6			156.9			158.3
Net finance revenue ("NFR")		254.2			260.8			252.7			515.0			535.0			250.6			254.2			271.6			765.6			806.6
Provision for credit losses		(66.8	)		(104.5	)		214.7			(171.3	)		723.6			(49.3	)		(66.8	)		87.9			(220.6	)		811.5
Other non-interest income		111.2			91.7			77.2			202.9			164.5			89.7			111.2			89.6			292.6			254.1
Operating expenses		183.0			186.9			201.2			369.9			414.5			185.9			183.0			196.7			555.8			611.2
Goodwill Impairment		-			-			-			-			301.5			—			—			—			—			301.5
Income (loss) before income taxes		249.2			270.1			(86.0	)		519.3			(740.1	)		203.7			249.2			76.6			723.0			(663.5	)
Noteworthy items		-			-			-			-			343.1			—			—			(2.5	)		—			340.6
Income (loss) before income taxes, excluding noteworthy items	$	249.2		$	270.1		$	(86.0	)	$	519.3		$	(397.0	)	$	203.7		$	249.2		$	74.1		$	723.0		$	(322.9	)
Select Period End Balance
Loans and leases	$	35,080.9		$	36,531.5		$	36,805.8		$	35,080.9		$	36,805.8		$	35,237.3		$	35,080.9		$	37,079.4		$	35,237.3		$	37,079.4
Earning assets (net of credit balances of factoring clients)		33,639.4			35,150.5			35,965.4			33,639.4			35,965.4			33,745.7			33,639.4			35,864.8			33,745.7			35,864.8
Deposits		11,117.4			10,644.3			9,555.9			11,117.4			9,555.9			11,057.8			11,117.4			9,985.3			11,057.8			9,985.3
Select Average Balances
Average loans (includes HFS, and net of credit balances of factoring clients)	$	26,484.4		$	27,322.5		$	28,479.9		$	26,901.1		$	28,168.7		$	25,498.5		$	26,484.4		$	27,902.6		$	26,428.5		$	28,073.8
Average operating leases ("AOL") (includes HFS)		7,754.0			7,831.2			7,602.1			7,792.4			7,509.1			7,862.5			7,754.0			7,824.4			7,816.0			7,615.0
Average earning assets ("AEA")		34,327.2			35,240.0			36,251.9			34,781.2			35,829.3			33,446.2			34,327.2			35,869.1			34,331.3			35,842.6
Statistical Data
Net finance margin - NFR as a % of AEA		2.96	%		2.96	%		2.79	%		2.96	%		2.99	%		3.00	%		2.96	%		3.03	%		2.97	%		3.00	%
Net operating lease revenue — rental income, net of depreciation and maintenance and other operating lease expenses	$	50.6		$	58.4		$	63.7		$	109.0		$	141.6		$	50.6		$	50.6		$	70.2		$	159.6		$	211.8
Operating lease margin as a % of AOL		2.61	%		2.98	%		3.34	%		2.80	%		3.76	%		2.57	%		2.61	%		3.59	%		2.72	%		3.70	%
Net efficiency ratio		49.1	%		52.0	%		59.9	%		50.5	%		58.2	%		53.7	%		49.1	%		53.5	%		51.5	%		56.6	%
Pretax return on AEA		2.90	%		3.07	%		(0.95	%)		2.99	%		(4.13	%)		2.44	%		2.90	%		0.85	%		2.81	%		(2.47	%)
New business volume	$	2,355.1		$	1,923.7		$	2,214.7		$	4,278.8		$	5,291.3		$	2,658.7		$	2,355.1		$	2,111.2		$	6,937.5		$	7,402.5

Pre-tax income for the quarter was up from the year-ago quarter, ~~driven by~~as lower credit costs h~~igher non-interest income~~ and lower operating expenses offset the decline in NFR. There were no noteworthy items in the current quarter, while the year-ago quarter included a portion of the PSU compensation expense reversal of $2.5 million. The year-ago quarter credit provision reflected the continued impact of the global pandemic from the spread of the COVID-19 virus and the expected ensuing adverse impact on the macroeconomic environment that resulted in a higher level of provision for credit losses and net charge-offs. ~~There was a benefit in the current quarter credit provision, reflecting a continued improvement in the macroeconomic forecasts along with lower loan balances.~~ The trends mentioned for the quarter comparison were similar for the year-to-date, excluding noteworthy ~~items.~~items, and included higher non-interest income, mostly from higher factoring commissions and gains on asset sales. The year-ago ~~six~~nine months also included noteworthy items of a $301.5 million goodwill impairment charge, ~~and~~ a $41.6 million charge to the provision for credit losses related to the MOB ~~acquisition.~~acquisition and the portion of the PSU compensation expense reversal mentioned above.

Pre-tax income was down compared to the prior quarter, reflecting ~~lower NFR,~~ a lower benefit for credit losses ~~partially offset by higher~~and lower non-interest income, as the prior quarter included higher gains on asset sales, including the gain on the Aviation Lending portfolio. The benefit in the current quarter credit provision reflected a continued improvement in the macroeconomic forecasts along with lower loan balances and improving credit metrics such as lower ~~operating expenses.~~charge-offs and non-accrual balances.

Average loans were down from the year-ago and prior quarters. The decline from the prior quarter was primarily driven by the sale of the Aviation Lending portfolio within Commercial Finance as well as a reduction in Real Estate Finance, which continues to be impacted by lower origination volume and high prepayments. The decline in average loans from the year ago quarter reflects declines in all divisions due to lower origination volume in sectors more impacted by the pandemic, the sale of the Aviation Lending portfolio in the 2021 second quarter, as well as high prepayments, particularly in Commercial Finance and Real Estate Finance. The decline from the prior quarter primarily reflected a reduction in Real Estate Finance, which continues to be impacted by lower origination volume and high prepayments, as well as Commercial Finance, which reflected a full quarter impact from the sale of the Aviation Lending portfolio along with continued high prepayments.

New business volume was up compared to the year-ago and prior quarters, reflecting improvement in Commercial Finance and Business Capital, while Real Estate Finance continues to remain below pre-pandemic levels.

Factored volume of ~~$6.1~~$6.9 billion was up from ~~$3.0~~$5.9 billion in the year-ago quarter. ~~The~~Factored volume in the year-ago quarter reflected the impact from

the macroeconomic environment that reduced demand throughout 2020. Factoring volume was seasonally up from $~~5.8~~6.1 billion in the prior quarter. For the ~~six~~nine months ended ~~June~~September 30, 2021, factored volume was ~~$11.9~~$18.8 billion, compared to ~~$9.1~~$15.0 billion in 2020.

Deposits attributed to this segment at ~~June~~September 30, 2021 include approximately ~~$6.8~~$6.9 billion of HOA deposits and other commercial deposits of ~~$4.3~~$4.2 billion.

Consumer Banking includes the Consumer and Community Banking and Legacy Consumer Mortgages (“LCM”) divisions. Retail Banking, Consumer Lending, Community Development Lending and SBA Lending are offerings within Consumer and Community Banking. LCM consists of acquired SFR loans that are in run-off. Revenue is generated from interest earned on residential mortgages, small business loans and from fees for banking services.

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
Earnings Summary	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Interest income	$	75.2		$	74.0		$	93.9		$	149.2		$	195.5		$	72.4		$	75.2		$	90.3		$	221.6		$	285.8
Interest (benefit) expense		(22.8	)		(19.7	)		5.5			(42.5	)		(4.6	)
Interest benefit																	(21.4	)		(22.8	)		(5.9	)		(63.9	)		(10.5	)
Net finance revenue ("NFR")		98.0			93.7			88.4			191.7			200.1			93.8			98.0			96.2			285.5			296.3
Provision for credit losses		(5.4	)		(12.9	)		8.9			(18.3	)		13.9			(17.8	)		(5.4	)		(24.6	)		(36.1	)		(10.7	)
Other non-interest income		36.6			26.5			2.7			63.1			16.7			34.0			36.6			30.9			97.1			47.6
Operating expenses		93.1			79.5			101.4			172.6			203.5			81.6			93.1			94.9			254.2			298.4
Goodwill impairment		-			-			-			-			43.2			—			—			—			—			43.2
Income (loss) before income taxes		46.9			53.6			(19.2	)		100.5			(43.8	)
Income before income taxes																	64.0			46.9			56.8			164.5			13.0
Noteworthy items		-			(2.6	)		-			(2.6	)		46.4			—			—			(0.5	)		(2.6	)		45.9
Income (loss) before income taxes, excluding noteworthy items	$	46.9		$	51.0		$	(19.2	)	$	97.9		$	2.6
Income before income taxes, excluding noteworthy items																$	64.0		$	46.9		$	56.3		$	161.9		$	58.9
Select Period End Balance
Loans (includes HFS)	$	6,463.5		$	6,916.8		$	8,573.3		$	6,463.5		$	8,573.3		$	6,257.0		$	6,463.5		$	8,096.2		$	6,257.0		$	8,096.2
Earning assets		6,532.6			6,982.0			8,602.6			6,532.6			8,602.6			6,328.5			6,532.6			8,122.7			6,328.5			8,122.7
Deposits		27,889.0			29,023.5			33,483.0			27,889.0			33,483.0			27,382.4			27,889.0			31,970.4			27,382.4			31,970.4
Select Average Balances
Average loans (includes HFS)	$	6,742.1		$	7,269.8		$	8,629.8		$	7,004.5		$	8,633.6		$	6,367.1		$	6,742.1		$	8,399.0		$	6,789.7		$	8,554.8
Average earning assets ("AEA")		6,810.2			7,399.6			8,658.3			7,103.2			8,662.0			6,435.8			6,810.2			8,426.6			6,878.3			8,583.0
Statistical Data
Net finance margin - NFR as a % of AEA		5.76	%		5.06	%		4.09	%		5.40	%		4.62	%		5.83	%		5.76	%		4.57	%		5.54	%		4.60	%
Net efficiency ratio		65.6	%		62.2	%		106.1	%		64.0	%		89.5	%		60.0	%		65.6	%		70.9	%		62.7	%		82.6	%
Pretax return on AEA		2.75	%		2.90	%		(0.89	%)		2.83	%		(1.01	%)		3.98	%		2.75	%		2.70	%		3.19	%		0.20	%
New business volume	$	616.9		$	519.6		$	857.3		$	1,136.5		$	1,372.8		$	592.7		$	616.9		$	510.5		$	1,729.2		$	1,883.3

Pre-tax income for the quarter was up from the year-ago quarter, ~~reflecting higher other non-interest income driven by gains on asset sales,~~as the decline in operating expenses, notably FDIC deposit

insurance costs, offset a lower benefit in the provision for credit ~~costs, higher NFR, and lower operating expenses.~~losses. There were no noteworthy items in the current ~~and~~quarter, while the year-ago ~~quarters.~~quarter included a portion of the PSU compensation expense reversal of $0.5 million. Pre-tax income was ~~down~~up from the prior ~~quarter.~~ ~~Pre-tax income, excluding noteworthy items was down~~ ~~mainly driven by higher~~quarter, as lower operating expenses and ~~a lower~~higher benefit for credit losses ~~that~~ offset ~~higher~~lower NFR due to lower interest income primarily from a decline in average loans and lower other non-interest income ~~(gains~~(lower gains on sales of loans) ~~and NFR.~~.

The ~~current year six month period~~nine months ended September 30, 2021 included a noteworthy item related to our strategic decision to sell certain investment securities, while the year-ago ~~six-month~~year-to-date period included a goodwill impairment charge, ~~and~~ a $3.2 million charge to the provision for credit losses from the MOB Acquisition, and the noted PSU compensation expense reversal. Pre-tax income excluding noteworthy items for the ~~six~~nine months ended ~~June~~September 30, 2021 was up from the year-ago period as higher other non-interest income, lower ~~credit costs and~~ operating expenses and higher benefit for credit losses offset lower NFR.

Compared to the year-ago quarter and prior quarter, as well as ~~six~~nine months ended ~~June~~September 30, 2020, average loans were down,

primarily due to LCM loan sales and ~~run-off.~~run-off and SBA PPP loan forgiveness. While the prepayment activity has slowed down ~~in Consumer Lending in~~compared to the ~~current~~prior quarter, prepayment activity was up for the ~~six~~nine months ended ~~June~~September 30, 2021 compared to the year-ago ~~six-month~~ period.

Deposits, which include deposits from the branch and online channels, decreased from the year-ago and prior quarters. The declines are primarily driven by reductions in time deposits. See discussions in Net Finance Revenue and Funding and Liquidity sections.

Corporate includes certain items that are not allocated to operating segments. Some of the more significant and recurring items include interest income on investment securities, a portion of interest expense primarily related to corporate funding costs, mark-to-market adjustments on foreign currency hedges and income on BOLI (other non-interest income), restructuring charges, as well as certain unallocated costs and intangible assets amortization expenses (operating expenses) and loss on debt extinguishments.

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,				September 30,			September 30,
Earnings Summary	2021			2021			2020			2021			2020			2021			2021			2020				2021			2020
Interest income	$	16.8		$	23.0		$	28.5		$	39.8		$	72.6		$	17.6		$	16.8		$	26.3			$	57.4		$	98.9
Interest expense		52.1			50.6			61.5			102.7			133.8			54.6			52.1			66.1				157.3			199.9
Net finance revenue ("NFR")		(35.3	)		(27.6	)		(33.0	)		(62.9	)		(61.2	)		(37.0	)		(35.3	)		(39.8	)			(99.9	)		(101.0	)
Other non-interest income		12.9			111.7			22.7			124.6			52.0			1.0			12.9			25.5				125.6			77.5
Operating expenses/(gain) loss on debt extinguishment		(24.9	)		7.7			43.0			(17.2	)		62.0			0.7			(24.9	)		3.9				(16.5	)		65.9
Income (loss) before income taxes		2.5			76.4			(53.3	)		78.9			(71.2	)
(Loss) income before income taxes																	(36.7	)		2.5			(18.2	)			42.2			(89.4	)
Noteworthy items		(6.2	)		(73.5	)		57.1			(79.7	)		74.2			13.9			(6.2	)		3.5				(65.8	)		77.7
(Loss) income before income taxes, excluding noteworthy items	$	(3.7	)	$	2.9		$	3.8		$	(0.8	)	$	3.0
(Loss) before income taxes, excluding noteworthy items																$	(22.8	)		(3.7	)	$	(14.7	)		$	(23.6	)	$	(11.7	)
Select Period End Balance
Earning assets	$	10,421.8		$	10,048.6		$	13,477.2		$	10,421.8		$	13,477.2		$	10,167.4		$	10,421.8		$	13,006.6			$	10,167.4		$	13,006.6
Select Average Balances
Average earning assets ("AEA")	$	10,673.7		$	10,562.6		$	12,678.8		$	10,618.5		$	11,145.6		$	10,465.1		$	10,673.7		$	13,472.3			$	10,566.7		$	11,926.9
Statistical Data
Net finance margin — NFR as a % of AEA		(1.33	%)		(1.04	%)		(1.05	%)		(1.18	%)		(1.10	%)		(1.42	%)		(1.33	%)		(1.18	%)			(1.26	%)		(1.13	%)
Pretax return on AEA		0.09	%		2.89	%		(1.68	%)		1.49	%		(1.28	%)		(1.41	%)		0.09	%		(0.54	%)			0.53	%		(1.00	%)

~~Pre-tax~~There was a higher pre-tax loss for the quarter compared to the year-ago quarter, while pre-tax income for the ~~quarter and six~~nine months ~~were~~ended September 30, 2021 was up from the year-ago ~~periods. Pre-tax~~pre-tax loss. However, pre-tax results, excluding noteworthy items were down compared to all periods. Compared to the prior quarter, the decline reflected higher operating expenses as the prior quarter included a benefit from the reserve release related to indemnification obligations.

Compared to the year-ago quarter, the decline in pre-tax results, excluding noteworthy items, reflected lower ~~other~~ non-interest income from lower gains on sales of investment ~~gains~~securities and lower ~~NFR, partially offset by~~BOLI income. Non-interest income was also down year-to-date compared to 2020, plus while operating expenses in 2021 included the benefit from the reserve release related to indemnification obligations, ~~which is included in other expenses. Compared to~~ the year-ago ~~quarter, the decline reflected lower non-interest income. While operating expenses in the current quarter included the benefit from the reserve release, the year-ago quarter~~nine months included a gain on debt redemptions of approximately $15 million.

	June 30,		March 31,		December 31,		September 30,		June 30,		December 31,
	2021		2021		2020		2021		2021		2020
Commercial Banking
Commercial Finance
Loans	$	15,969.9	$	16,089.8	$	16,243.9	$	16,099.2	$	15,969.9	$	16,243.9
Operating lease equipment, net		369.9		376.5		395.6		355.3		369.9		395.6
Assets held for sale		32.5		723.7		702.1		78.9		32.5		702.1
Total loans and leases		16,372.3		17,190.0		17,341.6		16,533.4		16,372.3		17,341.6
Business Capital
Loans		4,660.8		4,724.5		4,777.8		4,623.4		4,660.8		4,777.8
Operating lease equipment, net		292.8		287.9		342.1		321.6		292.8		342.1
Assets held for sale		0.7		0.2		-		1.4		0.7		—
Total loans and leases		4,954.3		5,012.6		5,119.9		4,946.4		4,954.3		5,119.9
Rail
Loans		62.6		61.5		60.7		63.7		62.6		60.7
Operating lease equipment, net		7,119.1		7,069.0		7,098.9		7,260.6		7,119.1		7,098.9
Assets held for sale		-		0.5		0.3		2.4		-		0.3
Total loans and leases		7,181.7		7,131.0		7,159.9		7,326.7		7,181.7		7,159.9
Real Estate Finance
Loans		6,572.6		7,197.9		7,554.1		6,430.8		6,572.6		7,554.1
Total loans and leases		6,572.6		7,197.9		7,554.1		6,430.8		6,572.6		7,554.1
Total Segment - Commercial Banking
Loans		27,265.9		28,073.7		28,636.5		27,217.1		27,265.9		28,636.5
Operating lease equipment, net		7,781.8		7,733.4		7,836.6		7,937.5		7,781.8		7,836.6
Assets held for sale		33.2		724.4		702.4		82.7		33.2		702.4
Total loans and leases		35,080.9		36,531.5		37,175.5		35,237.3		35,080.9		37,175.5
Consumer Banking
Consumer and Community Banking
Loans		5,079.5		5,330.4		5,814.3		5,041.8		5,079.5		5,814.3
Assets held for sale		18.3		27.2		13.9		13.1		18.3		13.9
Total loans and leases		5,097.8		5,357.6		5,828.2		5,054.9		5,097.8		5,828.2
Legacy Consumer Mortgages
Loans		1,365.7		1,553.4		1,693.8		1,202.1		1,365.7		1,693.8
Assets held for sale		-		5.8		4.9		-		-		4.9
Total loans and leases		1,365.7		1,559.2		1,698.7		1,202.1		1,365.7		1,698.7
Total Segment - Consumer Banking
Loans		6,445.2		6,883.8		7,508.1		6,243.9		6,445.2		7,508.1
Assets held for sale		18.3		33.0		18.8		13.1		18.3		18.8
Total loans and leases		6,463.5		6,916.8		7,526.9		6,257.0		6,463.5		7,526.9
Total loans	$	33,711.1	$	34,957.5	$	36,144.6	$	33,461.0	$	33,711.1	$	36,144.6
Total operating lease equipment, net		7,781.8		7,733.4		7,836.6		7,937.5		7,781.8		7,836.6
Total assets held for sale		51.5		757.4		721.2		95.8		51.5		721.2
Total loans and leases	$	41,544.4	$	43,448.3	$	44,702.4	$	41,494.3	$	41,544.4	$	44,702.4

~~Though origination~~Origination activity during the 2021 ~~second~~third quarter was up compared to the prior quarter, while loans and leases ~~declined on~~were relatively flat due to sales and prepayment activity. Commercial Banking loans and leases were ~~down~~up from ~~March~~June 30, 2021 reflecting increased factoring receivables in Commercial Finance due to seasonal trends and higher rail assets reflecting purchases, partially offset by prepayments and repayments in Real Estate Finance. The decline in Consumer Banking reflected prepayment activity that outpaced new business volume in Consumer and Community Banking, and sales and continued run-off of the LCM portfolio.

The decline in loans and leases since December 31, ~~2021 reflecting~~2020 in Commercial Banking primarily reflect the sale of the Aviation Lending portfolio in Commercial Finance ~~as well as higher prepayments~~and high prepayment activity in Commercial Finance and Real Estate Finance. The decline in loans in Consumer Banking ~~reflected high~~were driven by higher prepayment activity, ~~in Consumer and Community Banking from the SBA forgiveness of PPP loans,~~ and sales and ~~continued~~ run-off of the LCM portfolio.

	Commercial Banking			Consumer Banking			Total			Commercial Banking			Consumer Banking			Total
Balance as of March 31, 2021	$	36,531.5		$	6,916.8		$	43,448.3
Balance as of June 30, 2021										$	35,080.9		$	6,463.5		$	41,544.4
New business volume		2,355.1			616.9			2,972.0			2,658.7			592.7			3,251.4
Factoring volume		6,055.9			-			6,055.9			6,871.7			—			6,871.7
Loan and portfolio sales		(768.3	)		(147.9	)		(916.2	)		(26.6	)		(126.4	)		(153.0	)
Equipment sales		(84.4	)		-			(84.4	)		(46.6	)		—			(46.6	)
Depreciation		(82.8	)		-			(82.8	)		(85.1	)		—			(85.1	)
Gross charge-offs		(45.1	)		(2.3	)		(47.4	)		(15.3	)		(1.1	)		(16.4	)
Net collections and other		(8,881.0	)		(920.0	)		(9,801.0	)		(9,200.4	)		(671.7	)		(9,872.1	)
Balance as of June 30, 2021	$	35,080.9		$	6,463.5		$	41,544.4
Balance as of September 30, 2021										$	35,237.3		$	6,257.0		$	41,494.3

Balance as of December 31, 2020	$	37,175.5		$	7,526.9		$	44,702.4		$	37,175.5		$	7,526.9		$	44,702.4
New business volume		4,278.8			1,136.5			5,415.3			6,937.5			1,729.2			8,666.7
Factoring volume		11,882.9			-			11,882.9			18,754.5			—			18,754.5
Loan and portfolio sales		(841.3	)		(248.1	)		(1,089.4	)		(867.9	)		(374.5	)		(1,242.4	)
Equipment sales		(209.8	)		-			(209.8	)		(256.4	)		—			(256.4	)
Depreciation		(167.5	)		-			(167.5	)		(252.6	)		—			(252.6	)
Gross charge-offs		(70.9	)		(5.4	)		(76.3	)		(86.2	)		(6.5	)		(92.7	)
Net collections and other		(16,966.8	)		(1,946.4	)		(18,913.2	)		(26,167.1	)		(2,618.1	)		(28,785.2	)
Balance as of June 30, 2021	$	35,080.9		$	6,463.5		$	41,544.4
Balance as of September 30, 2021										$	35,237.3		$	6,257.0		$	41,494.3

Portfolio activities are discussed in the respective segment descriptions in Results by Business Segment.

The following tables present new business volume, loan and portfolio sales, and equipment sales by segment:

	Quarters Ended						Six Months Ended				Quarters Ended						Nine Months Ended
	June 30,		March 31,		June 30,		June 30,		June 30,		September 30,		June 30,		September 30,		September 30,		September 30,
	2021		2021		2020		2021		2020		2021		2021		2020		2021		2020
Commercial Banking	$	2,355.1	$	1,923.7	$	2,214.7	$	4,278.8	$	5,291.3	$	2,658.7	$	2,355.1	$	2,111.2	$	6,937.5	$	7,402.5
Consumer Banking		616.9		519.6		857.3		1,136.5		1,372.8		592.7		616.9		510.5		1,729.2		1,883.3
Total	$	2,972.0	$	2,443.3	$	3,072.0	$	5,415.3	$	6,664.1	$	3,251.4	$	2,972.0	$	2,621.7	$	8,666.7	$	9,285.8

	Quarters Ended						Six Months Ended				Quarters Ended						Nine Months Ended
	June 30,		March 31,		June 30,		June 30,		June 30,		September 30,		June 30,		September 30,		September 30,		September 30,
	2021		2021		2020		2021		2020		2021		2021		2020		2021		2020
Commercial Banking	$	768.3	$	73.0	$	3.4	$	841.3	$	41.6	$	26.6	$	768.3	$	53.9	$	867.9	$	95.5
Consumer Banking		147.9		100.2		63.6		248.1		119.1		126.4		147.9		151.9		374.5		270.9
Total	$	916.2	$	173.2	$	67.0	$	1,089.4	$	160.7	$	153.0	$	916.2	$	205.8	$	1,242.4	$	366.4

	Quarters Ended						Six Months Ended				Quarters Ended						Nine Months Ended
	June 30,		March 31,		June 30,		June 30,		June 30,		September 30,		June 30,		September 30,		September 30,		September 30,
	2021		2021		2020		2021		2020		2021		2021		2020		2021		2020
Commercial Banking	$	84.4	$	125.4	$	38.6	$	209.8	$	101.4	$	46.6	$	84.4	$	74.9	$	256.4	$	176.3
Corporate		-		-		-		-		0.3		—		—		—		—		0.3
Total	$	84.4	$	125.4	$	38.6	$	209.8	$	101.7	$	46.6	$	84.4	$	74.9	$	256.4	$	176.6

The following table represents CIT’s combined commercial and consumer loans and leases, including assets held for sale, by geographical regions:

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
West	$	13,100.8	31.5	%	$	14,553.4	32.6	%	$	12,696.3	30.6	%	$	14,553.4	32.6	%
Northeast		8,620.2	20.7	%		9,495.3	21.2	%		8,748.8	21.1	%		9,495.3	21.2	%
Midwest		6,026.1	14.5	%		6,098.8	13.6	%		6,161.7	14.8	%		6,098.8	13.6	%
Southwest		5,735.5	13.8	%		5,881.8	13.2	%		5,776.7	13.9	%		5,881.8	13.2	%
Southeast		5,295.5	12.7	%		5,457.7	12.2	%		5,112.8	12.3	%		5,457.7	12.2	%
Total U.S.		38,778.1	93.2	%		41,487.0	92.8	%		38,496.3	92.7	%		41,487.0	92.8	%
Canada		1,452.7	3.5	%		1,454.6	3.3	%		1,517.5	3.7	%		1,454.6	3.3	%
Europe		310.5	0.7	%		565.5	1.3	%		471.0	1.1	%		565.5	1.3	%
Asia / Pacific		398.8	1.0	%		601.1	1.3	%		385.7	0.9	%		601.1	1.3	%
All other countries		604.3	1.6	%		594.2	1.3	%		623.8	1.6	%		594.2	1.3	%
Total	$	41,544.4	100.0	%	$	44,702.4	100.0	%	$	41,494.3	100.0	%	$	44,702.4	100.0	%

⁽¹⁾Tablerepresents a combination of ~~Commercial~~commercial loans and leases that are shown by obligor geography and consumer loans that are shown by property address.

Our ten largest loan and lease accounts, primarily lessees of rail assets, in the aggregate represented approximately ~~4.7%~~5.4% and 5.3% of our total loans and leases at ~~June~~September 30, 2021 and December 31, 2020, respectively (the largest account was less than 1.0%).

The following table represents the commercial loans and leases, including assets held for sale, by obligor geography:

Commercial Loans and Leases by Obligor - Geographic Region (dollars in millions)

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
West	$	9,043.8	25.1	%	$	9,878.0	25.8	%	$	8,733.3	24.1	%	$	9,878.0	25.8	%
Northeast		8,151.0	22.6	%		8,913.8	23.3	%		8,307.1	23.0	%		8,913.8	23.3	%
Midwest		5,837.5	16.2	%		5,854.5	15.3	%		5,991.3	16.6	%		5,854.5	15.3	%
Southwest		5,419.7	15.0	%		5,506.4	14.4	%		5,478.5	15.1	%		5,506.4	14.4	%
Southeast		4,847.1	13.4	%		4,899.9	12.8	%		4,687.3	12.9	%		4,899.9	12.8	%
Total U.S.		33,299.1	92.3	%		35,052.6	91.6	%		33,197.5	91.7	%		35,052.6	91.6	%
Canada		1,452.7	4.0	%		1,454.6	3.8	%		1,517.5	4.2	%		1,454.6	3.8	%
Europe		310.5	0.9	%		565.5	1.5	%		471.0	1.3	%		565.5	1.5	%
Asia / Pacific		398.8	1.1	%		601.1	1.6	%		385.7	1.1	%		601.1	1.6	%
All other countries		604.3	1.7	%		594.2	1.5	%		623.8	1.7	%		594.2	1.5	%
Total	$	36,065.4	100.0	%	$	38,268.0	100.0	%	$	36,195.5	100.0	%	$	38,268.0	100.0	%

The following table summarizes both state concentrations greater than 5.0% and international country concentrations in excess of 1.0% of our loans and leases:

Commercial Loans and Leases by Obligor - State and Country (dollars in millions)

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
State
California	$	6,542.1	18.1	%	$	6,981.6	18.2	%	$	6,317.9	17.5	%	$	6,981.6	18.2	%
Texas		4,478.9	12.4	%		4,461.6	11.7	%		4,506.0	12.4	%		4,461.6	11.7	%
New York		2,578.5	7.1	%		3,257.2	8.5	%		2,695.2	7.4	%		3,257.2	8.5	%
Florida		2,042.9	5.7	%		2,011.1	5.3	%		1,851.0	5.1	%		2,011.1	5.3	%
All other states		17,656.7	49.0	%		18,341.1	47.9	%		17,827.4	49.3	%		18,341.1	47.9	%
Total U.S.	$	33,299.1	92.3	%	$	35,052.6	91.6	%	$	33,197.5	91.7	%	$	35,052.6	91.6	%
Country
Canada	$	1,452.7	4.0	%	$	1,454.6	3.8	%	$	1,517.5	4.2	%	$	1,454.6	3.8	%
Marshall Islands		385.1	1.1	%		498.2	1.3	%		369.1	1.0	%		498.2	1.3	%
All other countries		928.5	2.6	%		1,262.6	3.3	%		1,111.4	3.1	%		1,262.6	3.3	%
Total international	$	2,766.3	7.7	%	$	3,215.4	8.4	%	$	2,998.0	8.3	%	$	3,215.4	8.4	%

The following table represents loans and leases, including assets held for sale, by industry of obligor:

Commercial Loans and Leases by Obligor – Industry⁽³⁾ (dollars in millions)

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
Real Estate	$	7,132.4	19.8	%	$	7,708.5	20.1	%	$	7,087.3	19.6	%	$	7,708.5	20.1	%
Manufacturing⁽¹⁾		5,512.3	15.3	%		5,409.8	14.1	%		5,617.9	15.5	%		5,409.8	14.1	%
Service industries		2,886.7	8.0	%		2,850.1	7.4	%		2,812.9	7.8	%		2,850.1	7.4	%
Retail⁽²⁾		2,462.3	6.8	%		2,627.9	6.9	%		2,630.0	7.3	%		2,627.9	6.9	%
Energy and utilities		2,517.2	7.0	%		2,537.7	6.6	%		2,601.0	7.2	%		2,537.7	6.6	%
Business Services		1,914.0	5.3	%		2,274.8	5.9	%
Wholesale		2,280.5	6.3	%		2,145.7	5.6	%		2,362.5	6.5	%		2,145.7	5.6	%
Rail		1,835.5	5.1	%		1,959.4	5.1	%		1,876.9	5.2	%		1,959.4	5.1	%
Finance and insurance		1,663.1	4.6	%		1,948.4	5.1	%		1,767.8	4.9	%		1,948.4	5.1	%
Business services										1,741.9	4.8	%		2,274.8	5.9	%
Healthcare		1,493.2	4.1	%		1,611.9	4.2	%		1,300.4	3.6	%		1,611.9	4.2	%
Oil and gas extraction / services										1,093.1	3.0	%		1,378.2	3.6	%
Transportation		1,039.6	2.9	%		1,491.3	3.9	%		1,061.3	2.9	%		1,491.3	3.9	%
Oil and gas extraction / services		1,132.6	3.1	%		1,378.2	3.6	%
Communications										801.4	2.2	%		711.5	1.9	%
Maritime		677.9	1.9	%		929.7	2.4	%		742.7	2.1	%		929.7	2.4	%
Communications		827.1	2.3	%		711.5	1.9	%
Other (no industry greater than 2%)		2,691.0	7.5	%		2,683.1	7.2	%		2,698.4	7.4	%		2,683.1	7.2	%
Total	$	36,065.4	100.0	%	$	38,268.0	100.0	%	$	36,195.5	100.0	%	$	38,268.0	100.0	%

The following table presents our total outstanding consumer loans by product, including loans held for sale:

	June 30, 2021					December 31, 2020					September 30, 2021					December 31, 2020
	Net Investment		% of Total			Net Investment		% of Total			Net Investment		% of Total			Net Investment		% of Total
Single family residential	$	5,410.1		98.7	%	$	6,343.2		98.6	%	$	5,240.5		98.9	%	$	6,343.2		98.6	%
Home equity lines of credit and other		68.9		1.3	%		91.3		1.4	%		58.3		1.1	%		91.3		1.4	%
Total loans	$	5,479.0		100.0	%	$	6,434.5		100.0	%	$	5,298.8		100.0	%	$	6,434.5		100.0	%

The following table summarizes state concentrations greater than 5.0% based upon property address:

	June 30, 2021						December 31, 2020					September 30, 2021					December 31, 2020
	Net Investment		% of Total			Net Investment			% of Total			Net Investment		% of Total			Net Investment		% of Total
California	$	3,279.3		59.9	%	$		3,652.2		56.8	%	$	3,232.6		61.0	%	$	3,652.2		56.8	%
Texas		292.7		5.3	%			346.9		5.4	%		281.0		5.3	%		346.9		5.4	%
Washington		242.9		4.4	%			329.5		5.1	%		240.2		4.5	%		329.5		5.1	%
Other states		1,664.1		30.4	%			2,105.9		32.7	%		1,545.0		29.2	%		2,105.9		32.7	%
Total loans	$	5,479.0		100.0	%	$		6,434.5		100.0	%	$	5,298.8		100.0	%	$	6,434.5		100.0	%

The following tables present the components of other assets and other liabilities.

	June 30,		December 31,		September 30,		December 31,
	2021		2020		2021		2020
Tax credit investments and investments in unconsolidated entities	$	505.9	$	427.0	$	516.1	$	427.0
Fair value of derivative financial instruments		302.1		431.6		268.5		431.6
Right of use assets		259.3		198.8		252.7		198.8
Property, furniture and fixtures		184.9		187.0		176.7		187.0
Prepaid expenses		170.5		169.9		165.3		169.9
Counterparty receivables		139.1		174.1		140.2		174.1
Intangible assets, net		118.1		134.9		110.0		134.9
Current and deferred federal and state tax assets		38.2		60.8		35.3		60.8
Other⁽¹⁾		380.1		464.4		384.2		464.4
Total other assets	$	2,098.2	$	2,248.5	$	2,049.0	$	2,248.5

	June 30,		December 31,		September 30,		December 31,
	2021		2020		2021		2020
Accrued expenses and accounts payable	$	438.0	$	546.4	$	456.6	$	546.4
Lease liabilities		296.4		249.9		288.4		249.9
Current and deferred taxes payable						227.8		122.1
Commitment to fund tax credit investments		202.2		167.7		195.2		167.7
Current and deferred taxes payable		188.8		122.1
Accrued interest payable		79.2		88.2
Fair value of derivative financial instruments		71.7		79.2		77.9		79.2
Allowance for off-balance sheet credit exposure		61.8		78.3		50.1		78.3
Accrued interest payable						40.8		88.2
Other⁽¹⁾		284.2		423.1		867.1		423.1
Total other liabilities	$	1,622.3	$	1,754.9	$	2,203.9	$	1,754.9

CIT is subject to a variety of risks that may arise through the Company's business activities, including the following principal forms of risk that are explained further in our 2020 Form 10-K.

CIT is exposed to the risk that changes in market conditions or government policy may affect interest rates and negatively impact earnings. The risk arises from the nature of CIT’s business activities, the composition of CIT’s balance sheet, and changes in the level or shape of the yield curve. CIT manages this inherent interest rate risk strategically based on prescribed guidelines and approved limits.

Interest rate risk can arise from many of CIT’s business activities, such as lending, leasing, investing, deposit taking, derivatives, and funding activities. This risk is a result of assets and liabilities repricing at different times, or not at all, as interest rates change. We evaluate and monitor interest rate risk primarily through two metrics.

Our exposure to interest rate risk is guided by the company’s Risk Appetite Framework and a series of risk metrics including measurements of changes in income given a change in rates. The Company utilizes tools across the balance sheet to adjust its interest rate risk exposures, including through business line actions and actions within ~~the~~its investment, funding and derivative activities, as well as deposit product design and pricing.

The composition of our interest rate sensitive assets and liabilities generally results in a net asset-sensitive position, concentrated at the short end of the yield curve, mostly driven by moves in LIBOR, whereby our assets will reprice faster than our liabilities. Interest rate sensitive assets generally consist of interest-bearing cash ~~investment securities,~~ and ~~commercial and consumer~~floating rate loans. At ~~June~~September 30, 2021, approximately 60% of our total ~~Commercial~~commercial and ~~Consumer~~consumer loans (or approximately 50% of our loans and leases) had floating contractual reference rates, the majority of which were indexed to 1-month and 3-month LIBOR. Approximately ~~70%~~75% of our floating rate loans had index floors, of which approximately ~~50%~~55% were set at 0%.

In 2017, the U.K. Financial Conduct Authority, which is the authority responsible for regulating LIBOR, announced that the publication of LIBOR is not guaranteed beyond 2021. On November 30, 2020, the Intercontinental Exchange Benchmark Administration (“IBA”) announced it will consult on its intention to cease the publication of one week and two-month USD LIBOR settings at the end of December 2021 and the remaining USD LIBOR settings at the end of June 2023. The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency followed with a joint statement encouraging banks to cease entering into new contracts that use USD LIBOR as a reference rate as soon as practicable and in any event by December 31, 2021. LIBOR is a benchmark interest rate for most of our floating rate earning assets, particularly in Commercial Finance, Real Estate Finance and Consumer Banking (primarily mortgages), as well as certain liabilities and off-balance sheet exposures. We continue to monitor industry and regulatory developments and have a well-established transition program in place to manage the implementation of alternative reference rates as the market transitions away from LIBOR. Coordination is being handled by the Alternative Rates Working Group, a cross-functional team directed by a senior executive-level steering committee. Its mission is to work with CIT's businesses to ensure a smooth transition for CIT and its customers to an appropriate LIBOR alternative. Certain financial markets and products have already migrated to alternatives. CIT's Alternative Rates Working Group ensures that CIT is ready to move quickly and efficiently as consensus around LIBOR alternatives emerge.

~~CIT continues to assess the use of SOFR and other alternative rates as the market and best practices for transitioning to alternative rates develop.~~ See Reference Rate Reform section below.

Our funding sources consist primarily of non-maturity deposits and time deposits generated through the core deposit channels, including Online, Branch, HOA and Commercial as well as our network of deposit brokers. We also support our funding needs through wholesale funding sources (unsecured and secured debt), including FHLB ~~advances.~~Advances, though there were no advances at September 30, 2021.

At ~~June~~September 30, 2021, deposits totaled ~~$41~~$40 billion. The deposit rates we offer are influenced by market conditions and competitive factors. ~~Market rates are the key drivers of deposit costs and we continue to optimize deposit costs by improving our deposit mix, which includes the addition of relatively low cost HOA deposits.~~ Changes in interest rates, expected funding needs, as well as actions by competitors, can affect our deposit taking activities and deposit pricing. ~~We continue to believe our targeted non-maturity deposit customer retention is strong and we remain focused on optimizing our mix of deposits.~~ We regularly assess the effect of deposit rate changes on our balances and seek to achieve optimal alignment between assets and liabilities. As CIT evolves its strategies through various interest rate cycles, management may periodically revise the modelling assumptions and approaches in accordance with CIT’s governance structure, which may also impact changes in reported sensitivity.

The table below summarizes the results of simulation modeling produced by our asset/liability management system. The simulations we run require assumptions about rates, time horizons, balance sheet volumes, prepayment speeds, pricing and deposit behaviors, along with other inputs. The results presented below reflect the simulation of the NII Sensitivity over the next twelve months and the EVE Sensitivity over the life of the interest rate sensitive assets, liabilities and off-balance sheet items. These simulations assume an immediate 100 and 200 bps parallel increase and a 25 bps parallel decrease for both periods from the market-based forward curve. The NII Sensitivity is presented based on an assumption that the balance sheet composition and size remain static over the 12-month projection period.

	June 30, 2021							December 31, 2020							September 30, 2021									December 31, 2020
	+200 bps		+100 bps		-25 bps / 0% Floors			+200 bps		+100 bps		-25 bps / 0% Floors			+200 bps			+100 bps			-25 bps / 0% Floors			+200 bps		+100 bps		-25 bps / 0% Floors
NII Sensitivity	$	174	$	78	$	(12	)	$	137	$	85	$	(15	)	$	165		$	74		$	(11	)	$	137	$	85	$	(15	)
EVE Sensitivity	$	117	$	56	$	(18	)	$	6	$	62	$	(54	)	$	(12	)	$	(10	)	$	(1	)	$	6	$	62	$	(54	)

The NII Sensitivity and EVE Sensitivity results presented above assume that the Company takes no action in response to the changes in interest rates and includes only impacts from interest rate related influences. NII Sensitivity generally assumes cash flows from portfolio run-off are reinvested in similar products or cash to keep the balance sheet static. For that reason and others, the estimated impacts do not reflect the likely actual results but serve as estimates of interest rate risk. NII Sensitivity is not comparable to actual results disclosed elsewhere or directly predictive of future values of other measures provided.

The 25 bps down shock reported above is modeled with an assumption of a 0% market rate floor. ~~As part~~

On a year-to-date basis, as of our broader interest rate risk management practices, we also assessed a scenario which does not floor market rates at 0%, thereby allowing market rates to turn negative. In such a scenario, we expect the NII Sensitivity to be greater than the 25 bps down shock reported above.

~~As of June~~September 30, 2021, the dollar NII and EVE sensitivity changes ~~year-to-date~~ are primarily due to ~~compositional~~ changes in the composition of the balance sheet, as well as enhancements in modeling assumptions impacting long term deposit betas.

~~On a net basis, we~~We generally have more floating rate/re-pricing interest sensitive assets than liabilities inon the ~~near term.~~short end of the yield curve. As a result, the interest rate risk sensitivity of our current portfolio is more impacted by moves in short-term interest rates. Therefore, the NFR associated with the interest rate sensitive assets, liabilities and off-balance sheet items may ~~increase if~~change when short-term interest rates ~~rise or decrease. However, changes would~~change and may also be impacted by factors beyond interest rates, such as changes in balance sheet composition, spread compression or expansion, and deviations from modelled deposit betas. In addition, re-pricing of our non-interest rate sensitive assets (for example, the rail operating leases) will impact NFR.

Market-implied forward rates over the future twelve months are used to estimate a base interest rate scenario for the net interest income projection in the base case for NII Sensitivity. This base projection is compared with those calculated under varying interest rate scenarios to arrive at NII Sensitivity. Though there are many assumptions that affect the estimates for NII Sensitivity, those pertaining to deposit pricing, deposit mix and overall balance sheet composition are particularly impactful. Management continually evaluates the sensitivity of its risk metrics to these key assumptions.

EVE Sensitivity supplements ~~net interest income~~NII Sensitivity simulation ~~and sensitivity~~ analysis as it estimates risk exposures beyond a twelve-month horizon. EVE Sensitivity modeling measures the extent to which the economic value of assets, liabilities and off-balance sheet instruments may change in response to a change in interest rates. EVE Sensitivity is calculated by subjecting the balance sheet to different rate shocks, measuring the net value of assets, liabilities and off-balance sheet instruments, and comparing those amounts with the EVE in the base case, calculated using a ~~market-based~~market-implied forward interest rate curve. The methodology with which the operating lease assets are assessed in the EVE Sensitivity results in the table above reflects the existing contractual rental cash flows and the expected residual value at the end of the existing contract term.

A wide variety of potential interest rate scenarios beyond those presented here are simulated within our asset/liability management system. Interest sensitive assets, liabilities and off-balance sheet instruments are valued using discounted cash flow analysis for EVE Sensitivity. Rates are shocked via a set of scenarios that include both parallel and non-parallel interest rate movements. Scenarios are also run to capture our sensitivity to changes in the shape of the yield curve. Furthermore, we evaluate the sensitivity of these results to a number of key assumptions, such as discount spreads, deposit beta and prepayments of mortgage-related assets.

NII Sensitivity and EVE Sensitivity risk metrics have been established and are monitored for certain of the key scenarios. We manage the exposure to changes in NII Sensitivity and EVE Sensitivity in accordance with our risk appetite and within Board-approved limits.

We use results of our various interest rate risk analyses to formulate and ~~action~~implement asset and liability management (“ALM”) strategies, in coordination with the Asset Liability Committee (“ALCO”), to achieve the desired risk profile, while managing our objectives for capital adequacy, liquidity risk exposures and other strategic objectives. Specifically, we may manage our interest rate risk position through certain pricing strategies and product design for loans and deposits, our investment portfolio, issuing term debt with floating or fixed interest rates, and using derivatives such as interest rate swaps, which modify the interest rate characteristics of certain assets or liabilities.

These measurements provide an estimate of our interest rate sensitivity; however, they do not account for potential changes in credit quality, size, mix, and prepayment characteristics of our balance sheet, changes in PAA, or changes in the competition for business in the industries we serve. They also do not account for other business developments such as the recently announced Definitive Merger Agreement ~~impact~~ and other actions that could affect NFR, or for management actions that could affect NFR or that could be taken to change our risk profile. Accordingly, we can give no assurance that actual results would not differ materially from the estimated outcomes of our simulations. Further, the range of such simulations is not intended to represent our current view of the expected range of future interest rate movements.

The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency followed with a joint statement encouraging banks to cease entering into new contracts that use USD LIBOR as a reference rate as soon as practicable and in any event by December 31, 2021. As a result, CIT will stop originating new products using LIBOR by the end of 2021. LIBOR is a benchmark interest rate for most of our floating rate earning assets, particularly in Commercial Finance, Real Estate Finance and Consumer Banking (primarily mortgages), as well as certain liabilities and off-balance sheet exposures. We continue to monitor industry and regulatory developments and have a well-established transition program in place to manage the implementation of alternative reference rates as the market transitions away from LIBOR. Coordination is being handled by the Alternative Rates Working Group, a cross-functional team directed by a senior executive-level steering committee. Its mission is to work with CIT's businesses to ensure a smooth transition for CIT and its customers to an appropriate LIBOR alternative. Certain financial markets and products have already migrated to alternatives. CIT's Alternative Rates Working Group ensures that CIT is ready to move quickly and efficiently as consensus around LIBOR alternatives emerge. The Company has processes in place to complete its review of the population of legal contracts impacted by the LIBOR transition, and updates to our operational systems and processes are substantially in place.

The Company expects to utilize SOFR as our preferred replacement index for LIBOR; however, we continue to monitor how the market evolves regarding the use of alternative rates.

We continue to maintain appropriate levels of liquidity in accordance with our risk limit structures and comprehensive liquidity risk management framework. As of ~~June~~September 30, 2021, we were ~~91%~~90% deposit funded, and continued to maintain liquidity in excess of our minimum required risk limits. The framework includes monitoring processes and systems that are designed to ensure we have the appropriate level of liquidity to meet expected and contingent funding needs under both normal and stressed environments.

CIT actively manages its liquidity and monitors liquidity risk through a suite of tiered early warning indicators along with management and Board limits. The assessments of liquidity risk are measured under the assumption of normal operating conditions as well as under a range of stress scenarios, which use assumptions to reflect the changing market environment. Such scenarios cover a range of events, including systemic market-wide events and CIT-specific events. Liquidity stresses are applied in terms of duration and severity. Although not required by regulators, CIT continues to calculate and maintain a strong Liquidity Coverage Ratio above 100%, as defined for Category IV banks based on the FRB Tailoring Rule.

Liquidity stress test results, along with our risk metrics and other liquidity risk measurement practices, inform our business strategy, risk appetite, requirements for minimum balances of Liquid Assets and contingency funding plans.

We utilize a series of measurement tools to assess and monitor the level and adequacy of our liquidity position, liquidity conditions and trends. The primary tool is a liquidity forecast designed to identify movements in and levels of available cash and collateral flows, both contractually and behaviorally. We use a stress testing framework to better understand the range of potential risks and the impacts of those risks on CIT. Included among our liquidity measurement tools are risk metrics that assist in identifying potential liquidity risk and CIT’s exposure to those risks as well as their impact on CIT’s liquidity.

Oversight is provided by the Risk Management Committee, Enterprise Risk Committee, ALCO and the Risk Control Committee.

CIT closely monitors daily and intraday liquidity requirements in order to maintain appropriate amounts of Liquid Assets on our balance sheet and access to contingent sources of liquidity in order to meet our obligations.

At ~~June~~September 30, 2021, we had approximately ~~$10.0~~$9.2 billion of total Liquid Assets and approximately ~~$6.1~~$6.2 billion of contingent liquidity sources available, most of which is held at the Bank, commensurate with our assets.

~~We continue to expand our tools to monetize HQL securities through the additional FHLB capacity and unutilized repo lines.~~

In addition, the Company has access to a borrowing facility with the FRB Discount Window. No ~~amounts were~~amount was outstanding ~~with these facilities.~~on this facility. See “FRB” section further below.

Cash totaled ~~$5.3~~$4.6 billion at ~~June~~September 30, 2021 and $4.0 billion at December 31, 2020. ~~The increase was primarily driven by sales of investment securities.~~

Investment securities consisted primarily of US Treasury and Agency-issued fixed income securities and totaled ~~$5.3~~$5.8 billion at ~~June~~September 30, 2021 and $6.9 billion at December 31, 2020, of which ~~$5.1~~$5.6 billion and $6.7 billion, respectively, were AFS. Given market conditions, during the first quarter of 2021 we strategically sold certain AFS securities, which were primarily mortgage backed securities (“MBS”), to monetize unrealized gains that resided in AOCI. Securities of ~~$0.9~~$0.1 billion and $1.9 billion were pledged as of ~~June~~September 30, 2021 and December 31, 2020, respectively, to secure FHLB financing availability and mortgage programs, public funds ~~and~~in CIT Bank, derivative contracts and for other purposes as required or permitted by law.

We had $100 million and $150 million of securities purchased under agreement to resell at ~~June~~September 30, 2021 and December 31, ~~2020.~~2020, respectively. See Note 6 — Investment Securities in Item 1 for additional information on types and maturities of investment securities.

We fund our operations through deposits and borrowings. Deposits totaled ~~$41.3~~$40.2 billion, ~~91%~~90% of total funding at ~~June~~September 30, 2021 and $43.0 billion, 88% of total funding at December 31, 2020. Borrowings totaled $4.2 billion at ~~June~~September 30, 2021 and $5.8 billion at December 31, 2020. Borrowings consist of senior unsecured notes, subordinated unsecured notes and secured borrowings.

Unsecured borrowings ~~decreased to~~were approximately 9%10% of total funding ~~in the current quarter from 10%~~ at September 30, 2021 and December 31, 2020. Secured borrowings were less than 1% at ~~June~~September 30, 2021, ~~and~~down from 2% at December 31, ~~2020.~~2020, due to repayments. See the Net Finance Revenue section for a tabular presentation of our average funding mix.

In the first quarter of 2021, $500 million of unsecured borrowings were scheduled to mature, which we redeemed on February 9, 2021. No premium was paid upon redemption. In addition, we paid down $1.1 billion of FHLB advances ~~in 2021,~~during the first half of ~~which $600~~

~~million was repaid in the second quarter. There are no~~2021. The next scheduled unsecured borrowings ~~maturities~~maturity coming due ~~until~~is the $1.147 billion, 5.0% Senior Notes which mature in August 2022. As of ~~June~~September 30, 2021, time deposits with maturities over the coming twelve months were ~~$5.7~~$5.6 billion.

CIT Bank offers a full suite of deposit offerings to its commercial and consumer customers through a national online platform, a network of approximately 80 branches, which are in top MSAs in Southern California, and include bank branches acquired with the MOB Acquisition, primarily in the Southwest, Midwest and Southeast. The period end balances are as follows:

	June 30, 2021					December 31, 2020					September 30, 2021					December 31, 2020
	Total		Percent of Total			Total		Percent of Total			Total		Percent of Total			Total		Percent of Total
Online	$	16,670.9		40	%	$	18,864.6		44	%	$	16,215.7		40	%	$	18,864.6		44	%
Branch		11,218.1		27	%		11,461.8		26	%		11,166.7		28	%		11,461.8		26	%
Homeowners association		6,813.4		17	%		5,871.6		14	%		6,888.6		17	%		5,871.6		14	%
Commercial		4,401.3		11	%		4,445.0		10	%		4,256.0		11	%		4,445.0		10	%
Brokered / other channel		2,167.3		5	%		2,428.6		6	%		1,710.3		4	%		2,428.6		6	%
Total deposits	$	41,271.0		100	%	$	43,071.6		100	%	$	40,237.3		100	%	$	43,071.6		100	%

	June 30, 2021					December 31, 2020					September 30, 2021					December 31, 2020
	Total		Percent of Total			Total		Percent of Total			Total		Percent of Total			Total		Percent of Total
Savings and money market	$	26,134.3		63	%	$	26,019.1		60	%	$	25,652.5		64	%	$	26,019.1		60	%
Time deposits		8,264.2		20	%		10,420.2		24	%		7,821.2		20	%		10,420.2		24	%
Interest-bearing checking		3,355.7		8	%		3,247.6		8	%		3,382.7		8	%		3,247.6		8	%
Non-interest bearing deposits		3,516.8		9	%		3,384.7		8	%		3,380.9		8	%		3,384.7		8	%
Total deposits	$	41,271.0		100	%	$	43,071.6		100	%	$	40,237.3		100	%	$	43,071.6		100	%

The decline in the deposit balance in 2021 reflected our decision to reduce excess interest-bearing cash and implement strategic rate reductions. We lowered higher cost time and brokered deposits, partially offset by ~~seasonally higher balances and~~ growth in the HOA ~~channel. We~~channel, as we continued to shift the mix from time deposits to non-maturity deposits.

See “Net Finance Revenue” for discussion on deposits interest expense and rates.

At the Company, the loans and leases to deposits ratio was ~~101%~~103% at ~~June~~September 30, 2021, compared to 104% at December 31, 2020. At the Bank, the loans and leases to deposits ratio was ~~87%~~89% at ~~June~~September 30, 2021, compared to 90% at December 31, 2020.

There were no borrowings outstanding under the Revolving Credit Facility. The Revolving Credit Facility had a total commitment amount of $300 million as of ~~June~~September 30, 2021, all of which ~~approximately $286 million~~ was available to be ~~drawn~~drawn. The facility matured on November 1, 2021 and ~~the remainder~~ was ~~utilized for letters of credit.~~not renewed.

At ~~June~~September 30, 2021, senior unsecured notes outstanding totaled $3.7 billion and the weighted average coupon rate was 4.70%, compared to $4.2 billion and 4.63% at December 31, 2020. The changes reflected the $500 million redemption in February.

Subordinated unsecured notes principal amount totaled $500 million as of ~~June~~September 30, 2021 and consisted of $100 million of 4.125% fixed-to-fixed subordinated notes due in 2029 and $400 million of 6.125% fixed rate subordinated notes due 2028, which are included in Tier 2 capital.

We may pledge assets for secured borrowing transactions, which include borrowings from the FHLB and/or FRB, or for other purposes as required or permitted by law. The debt issued in conjunction with these transactions is collateralized by certain discrete receivables, securities, loans, leases and/or underlying equipment. Certain related cash balances are restricted.

As a member of the FHLB of San Francisco, CIT Bank N.A. can access financing based on an evaluation of its creditworthiness, statement of financial position, size and eligibility of collateral. The interest rates charged by the FHLB for advances typically vary depending upon maturity, the cost of funds of the FHLB, and the collateral provided for the borrowing. Advances are secured by certain Bank assets and bear either a fixed or floating interest rate. The FHLB advances are collateralized by a variety of consumer and commercial loans, including SFR mortgage loans, multi-family mortgage loans, commercial real estate

There were no outstanding FHLB advances at ~~June~~September 30, 2021. The decline from December 31, 2020 reflected net repayments during the year. CIT Bank may borrow additional FHLB advances, as liquidity needs arise or repay advances as liquidity allows. The available capacity ~~of $6,034.5 million includes $714.8 million~~was $5.4 billion ~~to borrow against~~ ~~$744.7~~ ~~million of pledged~~ ~~HQL securities, which have not been borrowed against~~ at ~~June~~September 30, 2021 ~~and remain available for sale.~~with pledged assets of $7.0 billion, essentially all lending assets. FHLB advances and pledged assets are also discussed in Note 8 — Borrowings.

Outstanding other secured and structured financings were not significant and totaled ~~$10.3~~$12.0 million at ~~June~~September 30, 2021, and $6.1 million at December 31, 2020. The total borrowing capacity of the ABL facility was $750 million, with net availability based on eligible collateral. There were ~~$30~~$26 million of LCs outstanding and no borrowings at ~~June~~September 30, 2021. The facility expires in December 2021.

The Company has a borrowing facility with the FRB Discount Window that can be used for short-term, typically overnight borrowings. ~~Effective March 16, 2020, the FRB announced changes to the FRB Discount Window, including the extension of the term of such borrowings up to 90 days.~~ The borrowing capacity is determined by the FRB based on the collateral pledged. There were no outstanding borrowings with the FRB Discount Window as of ~~June~~September 30, 2021 and December 31, 2020. See Note 8 — Borrowings in Item 1 for total balances pledged, including amounts to the FRB.

Debt ratings can influence the cost and availability of short- and long-term funding, the terms and conditions on which such funding may be available, the collateral requirements, if any, for borrowings and certain derivative instruments, the acceptability of our letters of credit, and the number of investors and counterparties willing to lend to the Company.

CIT Group Inc. and CIT Bank, N.A. debt ratings, as rated by Standard & Poor’s Ratings Services (“S&P”), Fitch Ratings, Inc. (“Fitch”) and Moody’s Investors Service (“Moody’s”) are presented in the following table:

Rating agencies indicate that they base their ratings on many quantitative and qualitative factors, including capital adequacy, liquidity, asset quality, business mix, level and quality of earnings, and the current operating, legislative and regulatory environment, including implied government support. Potential changes in the factors noted above, rating methodology as well as in the legislative and regulatory environment and the timing of those changes could negatively impact the Company’s ratings, which could adversely affect the Company’s liquidity and financial condition.

A debt rating is not a recommendation to buy, sell or hold securities, and the ratings are subject to revision or withdrawal at any time by the assigning rating agency. Each rating should be evaluated independently of any other rating.

On June 15, 2021, DBRS, Inc. (DBRS) withdrew ~~the~~its ratings on CIT Group Inc. and CIT Bank, N.A. ~~The~~Their last rating action on CIT was on October 16, 2020, when DBRS placed CIT's ratings, including its Long Term Senior Unsecured Debt rating of BBB (low), under review with positive implications. This prior rating action followed the announcement that CIT had entered into a definitive merger agreement with First Citizens.

The following table summarizes commitment expiration during the respective twelve-month periods.

Commitment Expiration for the Twelve Months Ending ~~June~~September 30, (dollars in millions)

	Total		2022		2023		2024		2025		2026+		Total		2022		2023		2024		2025		2026+
Financing commitments (excluding leases)	$	7,208.8	$	2,831.2	$	1,173.1	$	1,322.4	$	926.1	$	956.0	$	6,673.7	$	2,615.1	$	1,118.7	$	1,229.7	$	751.3	$	958.9
Lessor commitments		572.4		572.4		—		—		—		—		408.2		408.2		—		—		—		—
Letters of credit		276.0		39.5		68.5		73.7		31.2		63.1		259.1		44.5		56.2		62.7		27.5		68.2
Deferred purchase agreements		1,835.1		1,835.1		—		—		—		—		2,170.5		2,170.5		—		—		—		—
Total contractual commitments	$	9,892.3	$	5,278.2	$	1,241.6	$	1,396.1	$	957.3	$	1,019.1	$	9,511.5	$	5,238.3	$	1,174.9	$	1,292.4	$	778.8	$	1,027.1

At ~~June~~September 30, 2021, substantially all of our undrawn financing commitments were senior facilities, with approximately ~~96%~~95% secured by commercial equipment or other assets, and the remainder primarily comprised of cash flow or enterprise value facilities. Most of our undrawn and available financing commitments are in the Commercial Finance and Real Estate Finance divisions of Commercial Banking and include unused revolver availability of ~~$3.1~~$2.9 billion, which is subject to borrower base revolver capacity and covenant compliance. Also included in financing commitments are delayed draws and term loans of ~~$2.0~~$1.7 billion. Customer draws on such facilities are subject to certain pre-determined contract conditions. The top ten undrawn financing commitments totaled ~~$668.0~~$678.9 million at ~~June~~September 30, 2021. Financing commitments related to consumer loans totaled approximately ~~$478.6~~$519.3 million. See Note 13 – Commitments in Item 1 for further detail.

The Company’s capital management is discussed in our Annual Report on Form 10-K, Item 1. Business Overview - Regulation, subsections “Capital ~~Requirements”~~Requirements and “Regulatory Expectations for Capital Planning.”

The Company maintains a comprehensive capital adequacy process. The Company establishes internal capital risk limits and warning thresholds, which utilize Risk-Based and Leverage-Based Capital calculations, internal and external early warning indicators, its capital planning process, and stress testing to evaluate the Company's capital adequacy for multiple types of risk in both normal and stressed environments. The capital management framework requires management to define contingency plans, which may be employed at management’s discretion.

Declaration Date	Payment Date	Per Share Dividend		Payment Date	Per Share Dividend
Common Stock
January 22, 2021	February 19, 2021	$	0.35	February 19, 2021	$	0.35
April 20, 2021	May 21, 2021	$	0.35	May 21, 2021	$	0.35
July 19, 2021				August 13, 2021	$	0.35
Series A Preferred Stock
April 20, 2021	June 15, 2021	$	29.00	June 15, 2021	$	29.00
Series B Preferred Stock (dividend per share rounded)
January 22, 2021	March 15, 2021	$	0.35	March 15, 2021	$	0.35
April 20, 2021	June 15, 2021	$	0.35	June 15, 2021	$	0.35
July 19, 2021				September 15, 2021	$	0.35

On ~~July 19,~~October 18, 2021, the Board of Directors of the Company declared a quarterly cash dividend in the amount of $0.35 per outstanding common share. The common stock dividend is payable on ~~August 13,~~November 12, 2021 to common shareholders of record as of ~~July 30,~~October 29, 2021.

On ~~July 19,~~October 18, 2021, the Board of Directors of the Company declared a semi-annual cash dividend in the amount of $29 per outstanding share on Series A preferred stock and a quarterly cash dividend in the amount of approximately $0.35 per outstanding share ~~of outstanding~~on Series B preferred stock. The ~~dividend is~~dividends are payable on ~~September~~December 15, 2021 to Series A and B preferred shareholders of record as of ~~August 31,~~November 30, 2021. Payment of the dividend on the Company’s Series A and Series B preferred stock is conditional on the anticipated merger between CIT and FCB, if approved, occurring after the record date. If the merger occurs before the record date, the Company’s Series A and Series B preferred stock will be replaced with First Citizens’ new Series B and new Series C Preferred Stock, ~~having~~respectively, and will have such rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a whole, that are not materially less favorable to the holders thereof than the Company’s existing Series A and Series B Preferred Stock, and First Citizens will be responsible for paying the dividend on ~~September~~December 15, 2021 to holders of record as of ~~August 31,~~November 30, 2021 of its new Series B and new Series C Preferred ~~Stock.~~Stock, respectively.

The Company is subject to various regulatory capital requirements. We compute capital ratios in accordance with Federal Reserve and OCC capital ~~guidelines~~rules for assessing adequacy of capital. The regulatory capital ~~guidelines~~rules applicable to the Company and CIT Bank were the Basel III Rule and the Simplification Final Rule for the periods ended ~~June~~September 30, 2021 and December 31, 2020. At ~~June~~September 30, 2021 and December 31, 2020, the capital ratios of the Company and CIT Bank exceeded all capital adequacy requirements.

In March 2020, the OCC, FRB and FDIC collectively issued the Revised CECL Transition Rule for regulatory capital, which provides for the option to delay for two years the impact of CECL’s effect on regulatory capital, followed by a three-year transition period. The Company elected to use the 5-year transition under the Revised CECL Transition Rule, which resulted in a benefit of

Capital Components, Risk-Weighted Assets, and Capital Ratios (dollars in millions)

	June 30,			December 31,			September 30,			December 31,
	2021			2020			2021			2020
CET1 Capital
Total common stockholders’ equity⁽¹⁾	$	5,510.8		$	5,197.9		$	5,649.6		$	5,197.9
Effect of CECL transition impact on retained earnings⁽²⁾		122.7			174.0			109.0			174.0
Effect of certain items in AOCI excluded from CET1 Capital		106.2			(44.8	)		122.3			(44.8	)
Adjusted total equity		5,739.7			5,327.1			5,880.9			5,327.1
Deferred tax assets (“DTAs”) arising from net operating loss and tax credit carryforwards		(5.5	)		(8.8	)
Intangible assets, net of associated deferred tax liabilities (“DTLs”)		(110.7	)		(125.5	)
Deferred tax assets (DTAs) arising from net operating loss and tax credit carryforwards								(6.1	)		(8.8	)
Intangible assets, net of associated deferred tax liabilities (DTLs)								(102.6	)		(125.5	)
CET1 Capital		5,623.5			5,192.8			5,772.2			5,192.8
Additional Tier 1 Capital
Preferred Stock		525.0			525.0			525.0			525.0
Total Additional Tier 1 Capital		525.0			525.0			525.0			525.0
Total Tier 1 Capital		6,148.5			5,717.8			6,297.2			5,717.8
Tier 2 Capital
Qualifying Tier 2 Capital Instruments		495.2			494.9			495.3			494.9
Qualifying adjusted allowance for credit losses⁽²⁾⁽³⁾		605.6			650.5			605.3			650.5
Total Tier 2 Capital		1,100.8			1,145.4			1,100.6			1,145.4
Total Capital	$	7,249.3		$	6,863.2		$	7,397.8		$	6,863.2
Risk-Weighted Assets	$	48,365.1		$	51,847.0		$	48,383.4		$	51,847.0
CIT Ratios
CET1 Capital Ratio		11.6	%		10.0	%		11.9	%		10.0	%
Tier 1 Capital Ratio		12.7	%		11.0	%		13.0	%		11.0	%
Total Capital Ratio		15.0	%		13.2	%		15.3	%		13.2	%
Tier 1 Leverage Ratio		11.0	%		9.5	%		11.5	%		9.5	%
CIT Bank, N.A. Capital Components and Ratios
CET1 Capital	$	5,365.1		$	4,907.7		$	5,446.7		$	4,907.7
Tier 1 Capital		5,365.1			4,907.7			5,446.7			4,907.7
Total Capital		6,179.9			5,760.1			6,255.6			5,760.1
Risk-Weighted Assets		41,045.8			43,962.5			40,607.8			43,962.5
CET1 Capital Ratio		13.1	%		11.2	%		13.4	%		11.2	%
Tier 1 Capital Ratio		13.1	%		11.2	%		13.4	%		11.2	%
Total Capital Ratio		15.1	%		13.1	%		15.4	%		13.1	%
Tier 1 Leverage Ratio		10.6	%		8.9	%		11.1	%		8.9	%
Effective/Required Minimum Ratios under Basel III Guidelines (CIT and CIT Bank)
CET1 Capital Ratio		7.0	%		7.0	%		7.0	%		7.0	%
Tier 1 Capital Ratio		8.5	%		8.5	%		8.5	%		8.5	%
Total Capital Ratio		10.5	%		10.5	%		10.5	%		10.5	%
Tier 1 Leverage Ratio		4.0	%		4.0	%		4.0	%		4.0	%

The CET1 Capital Ratio increased from December 31, 2020, reflecting increased retained earnings, ~~for the quarter,~~ combined with a reduction in RWA.

	June 30,			December 31,			September 30,			December 31,
	2021			2020			2021			2020
Balance sheet assets	$	54,703.7		$	58,106.6		$	54,420.0		$	58,106.6
Risk weighting adjustments to balance sheet assets		(12,362.0	)		(12,898.1	)		(11,961.9	)		(12,898.1	)
Off-Balance sheet items		6,023.4			6,638.5
Risk-weighted off-Balance sheet items								5,925.3			6,638.5
Risk-Weighted Assets	$	48,365.1		$	51,847.0		$	48,383.4		$	51,847.0

~~As discussed elsewhere, the~~The decrease in balance sheet assets was driven by a decline in loans and investment securities, partially offset by an increase in cash balances. The risk weighting adjustments to balance sheet assets as of ~~June~~September 30, 2021 decreased from December 31, 2020 as a result of the decline in ~~assets, as well as mix,~~investment securities, single family residential loans and mark-to-market on derivatives, slightly offset by higher cash balances. The off-balance sheet items are lower, primarily due to lower off-balance sheet commitments and derivative contract exposures. See Note 13 – Commitments in Item 1, which presents a table reflecting the

The 2021 off-balance sheet items primarily reflect ~~$2.9~~$2.7 billion of unused lines of credit (largely related to the Commercial and Real Estate Finance divisions), ~~$2.1~~$2.2 billion related to DPAs (Commercial Finance division), $0.5 billion of derivative exposures, and $0.5 billion of other items. See Note 13 — Commitments in Item 1 for further detail on commitments.

Book Value, Tangible Book Value and per Share Amounts (dollars in millions, except per share amounts)

	June 30,			December 31,			September 30,			December 31,
	2021			2020			2021			2020
Total common stockholders' equity	$	5,510.8		$	5,197.9		$	5,649.6		$	5,197.9
Intangible assets		(118.1	)		(134.9	)		(110.0	)		(134.9	)
Tangible book value⁽¹⁾	$	5,392.7		$	5,063.0		$	5,539.6		$	5,063.0
Book value per share	$	55.58		$	52.71		$	56.97		$	52.71
Tangible book value per share⁽¹⁾	$	54.39		$	51.34		$	55.86		$	51.34

Book value ("BV") and tangible book value (“TBV”), and the respective per share amounts, at ~~June~~September 30, 2021 increased from December 31, 2020, as net income more than offset changes in AOCI and dividends paid, as well as the increase in common shares outstanding due to the vesting of restricted stock.

The following tables present condensed financial information for CIT Bank. Trends and significant items are discussed in the previous sections of the MD&A. Loans and leases not included in the bank primarily relate to certain rail assets and our factoring business. Capital ratios are presented in the Capital section.

	June 30,			December 31,			September 30,			December 31,
	2021			2020			2021			2020
ASSETS:
Cash and deposits with banks	$	5,032.9		$	3,829.8		$	4,375.0		$	3,829.8
Securities purchased under agreement to resell		150.0			150.0			100.0			150.0
Investment securities		5,277.8			6,871.1			5,757.3			6,871.1
Assets held for sale		48.5			718.2			90.5			718.2
Loans		31,554.8			33,632.5			30,957.8			33,632.5
Allowance for credit losses		(834.7	)		(1,024.6	)		(780.0	)		(1,024.6	)
Operating lease equipment, net		5,205.8			5,232.2			5,372.2			5,232.2
Bank owned life insurance		1,185.2			1,168.8			1,193.4			1,168.8
Other assets		1,688.9			1,806.7			1,654.7			1,806.7
Total Assets	$	49,309.2		$	52,384.7		$	48,720.9		$	52,384.7
LIABILITIES AND EQUITY:
Deposits, including $912.3 and $1,131.3 due to affiliates at June 30, 2021 and December 31, 2020, respectively	$	42,183.3		$	44,202.9
Deposits, including $618.8 and $1,131.3 due to affiliates at September 30, 2021 and December 31, 2020, respectively							$	40,856.2		$	44,202.9
FHLB advances		-			1,100.0			—			1,100.0
Borrowings, including $302.1 and $552.2 due to affiliates at June 30, 2021 and December 31, 2020, respectively		626.3			872.7
Other liabilities, including $171.4 and $89.7 payable to affiliates at June 30, 2021 and December 31, 2020, respectively		1,221.0			1,266.1
Borrowings, including $302.1 and $552.2 due to affiliates at September 30, 2021 and December 31, 2020, respectively								627.7			872.7
Other liabilities, including $253.9 and $89.7 payable to affiliates at September 30, 2021 and December 31, 2020, respectively								1,888.9			1,266.1
Total Liabilities		44,030.6			47,441.7			43,372.8			47,441.7
Total Equity		5,278.6			4,943.0			5,348.1			4,943.0
Total Liabilities and Equity	$	49,309.2		$	52,384.7		$	48,720.9		$	52,384.7

	June 30,		December 31,		September 30,		December 31,
	2021		2020		2021		2020
Commercial Banking
Commercial Finance	$	14,265.0	$	14,875.1	$	14,080.5	$	14,875.1
Business Capital		4,953.1		5,118.8		4,945.3		5,118.8
Rail		4,554.9		4,508.0		4,706.9		4,508.0
Real Estate Finance		6,572.6		7,554.1		6,430.8		7,554.1
Total		30,345.6		32,056.0		30,163.5		32,056.0
Consumer Banking
Consumer and Community Banking		5,097.8		5,828.2		5,054.9		5,828.2
Legacy Consumer Mortgages		1,365.7		1,698.7		1,202.1		1,698.7
Total		6,463.5		7,526.9		6,257.0		7,526.9
Total loans and leases	$	36,809.1	$	39,582.9	$	36,420.5	$	39,582.9

	Quarters Ended									Six Months Ended						Quarters Ended								Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,		September 30,			September 30,
	2021			2021			2020			2021			2020			2021			2021			2020		2021			2020
Interest and fees on loans	$	342.4		$	350.9		$	403.3		$	693.3		$	851.6		$	328.4		$	342.4		$	383.9	$	1,021.7		$	1,235.5
Other interest and dividends		17.1			23.7			29.2			40.8			74.5			17.8			17.1			27.2		58.6			101.7
Interest income		359.5			374.6			432.5			734.1			926.1			346.2			359.5			411.1		1,080.3			1,337.2
Interest on deposits		50.7			61.2			138.3			111.9			294.9			47.3			50.7			103.2		159.2			398.1
Interest on borrowings		3.4			4.7			10.6			8.1			24.4			3.1			3.4			6.8		11.2			31.2
Interest expense on deposits and payables with affiliated companies		4.5			4.5			3.2			9.0			7.6
Interest on deposits and payables with affiliated companies																	3.1			4.5			3.4		12.1			11.0
Interest expense		58.6			70.4			152.1			129.0			326.9			53.5			58.6			113.4		182.5			440.3
Net interest revenue		300.9			304.2			280.4			605.1			599.2			292.7			300.9			297.7		897.8			896.9
Provision for credit losses		(53.1	)		(98.4	)		122.8			(151.5	)		629.8			(61.3	)		(53.1	)		21.5		(212.8	)		651.3
Net interest revenue, after credit provision		354.0			402.6			157.6			756.6			(30.6	)		354.0			354.0			276.2		1,110.6			245.6
Rental income on operating leases		117.2			120.4			119.1			237.6			243.6			114.0			117.2			126.8		351.6			370.4
Other non-interest income		130.1			200.5			87.3			330.6			188.0			104.9			130.1			116.5		435.5			304.5
Total net revenue, net of interest expense and credit provision		601.3			723.5			364.0			1,324.8			401.0			572.9			601.3			519.5		1,897.7			920.5
Operating expenses		224.4			250.5			336.2			474.9			630.1			241.1			224.4			275.1		716.0			905.2
Gain on debt extinguishment and deposit redemptions		-			-			(15.4	)		-			(15.4	)
Loss on debt extinguishment and deposit redemptions																	—			—			—		—			(15.4	)
Goodwill impairment		-			-			-			-			323.1			—			—			—		—			323.1
Depreciation on operating lease equipment		65.2			66.7			62.6			131.9			122.8			67.5			65.2			64.5		199.4			187.3
Maintenance and other operating lease expenses		24.4			35.7			24.3			60.1			54.7			17.8			24.4			13.4		77.9			68.1
Income (loss) before provision for income taxes		287.3			370.6			(43.7	)		657.9			(714.3	)		246.5			287.3			166.5		904.4			(547.8	)
Provision (benefit) for income taxes		75.7			94.9			4.7			170.6			(112.7	)		60.5			75.7			46.5		231.1			(66.2	)
Net income (loss)	$	211.6		$	275.7		$	(48.4	)	$	487.3		$	(601.6	)	$	186.0		$	211.6		$	120.0	$	673.3		$	(481.6	)
New business volume - funded	$	2,972.0		$	2,439.9		$	3,062.3		$	5,411.9		$	6,634.0		$	3,215.6		$	2,972.0		$	2,621.6	$	8,627.5		$	9,255.6

	Quarters Ended						Six Months Ended				Quarters Ended						Nine Months Ended
	June 30,		March 31,		June 30,		June 30,		June 30,		September 30,		June 30,		September 30,		September 30,		September 30,
	2021		2021		2020		2021		2020		2021		2021		2020		2021		2020
Interest income	$	359.5	$	374.6	$	432.5	$	734.1	$	926.1	$	346.2	$	359.5	$	411.1	$	1,080.3	$	1,337.2
Rental income on operating leases		117.2		120.4		119.1		237.6		243.6		114.0		117.2		126.8		351.6		370.4
Finance revenue		476.7		495.0		551.6		971.7		1,169.7		460.2		476.7		537.9		1,431.9		1,707.6
Interest expense		58.6		70.4		152.1		129.0		326.9		53.5		58.6		113.4		182.5		440.3
Depreciation on operating lease equipment		65.2		66.7		62.6		131.9		122.8		67.5		65.2		64.5		199.4		187.3
Maintenance and other operating lease expenses		24.4		35.7		24.3		60.1		54.7		17.8		24.4		13.4		77.9		68.1
Net finance revenue	$	328.5	$	322.2	$	312.6	$	650.7	$	665.3	$	321.4	$	328.5	$	346.6	$	972.1	$	1,011.9
AEA	$	48,300.9	$	49,770.5	$	53,722.9	$	49,031.7	$	51,751.5	$	46,877.5	$	48,300.9	$	54,277.6	$	48,305.7	$	52,599.7

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Interest income		2.98	%		3.01	%		3.22	%		2.99	%		3.58	%		2.96	%		2.98	%		3.03	%		2.98	%		3.39	%
Rental income on operating leases		0.97	%		0.97	%		0.89	%		0.97	%		0.94	%		0.97	%		0.97	%		0.93	%		0.97	%		0.94	%
Finance revenue		3.95	%		3.98	%		4.11	%		3.96	%		4.52	%		3.93	%		3.95	%		3.96	%		3.95	%		4.33	%
Interest expense		0.49	%		0.56	%		1.13	%		0.53	%		1.26	%		0.46	%		0.49	%		0.84	%		0.50	%		1.12	%
Depreciation on operating lease equipment		0.54	%		0.54	%		0.47	%		0.54	%		0.47	%		0.58	%		0.54	%		0.48	%		0.55	%		0.47	%
Maintenance and other operating lease expenses		0.20	%		0.29	%		0.18	%		0.25	%		0.21	%		0.15	%		0.20	%		0.10	%		0.22	%		0.17	%
Net finance margin		2.72	%		2.59	%		2.33	%		2.65	%		2.57	%		2.74	%		2.72	%		2.55	%		2.68	%		2.57	%

The preparation of financial statements in conformity with GAAP requires management to use judgment in making estimates and assumptions that affect reported amounts of assets and liabilities, reported amounts of income and expense and the disclosure of contingent assets and liabilities. The following estimates, which are based on relevant information available at the end of each period, include inherent risks and uncertainties related to judgments and assumptions made. We consider these estimates to be critical in applying our accounting policies, due to the existence of uncertainty at the time the estimate is made, the likelihood of changes in estimates from period to period and the potential impact on the financial statements.

Management believes that the judgments and assessments utilized for the more critical accounting estimates, such as the ACL and realizability of deferred tax assets, are reasonable. We do not believe that different assumptions are more likely than those utilized, although actual events may differ from such assumptions. Consequently, our estimates could prove inaccurate, and we may be exposed to charges to earnings that could be material.

There have been no significant changes to the methodologies and processes used in developing estimates relating to these items from those described in our 2020 Form 10-K.

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Select Statement of Operations Data
Net interest revenue	$	266.3		$	268.5		$	244.4		$	534.8		$	532.3		$	256.8		$	266.3		$	257.8		$	791.6		$	790.1
Provision for credit losses		(72.2	)		(117.4	)		223.6			(189.6	)		737.5			(67.1	)		(72.2	)		63.3			(256.7	)		800.8
Total non-interest income		348.9			424.6			303.5			773.5			643.9			310.9			348.9			347.3			1,084.4			991.2
Total non-interest expenses		388.9			410.4			482.8			799.3			1,293.8			403.8			388.8			426.6			1,203.0			1,720.4
Net income (loss)		226.9			303.8			(85.3	)		530.7			(709.6	)		175.5			226.9			85.7			706.2			(623.9	)
Net income (loss) available to common shareholders		214.6			301.0			(97.6	)		515.6			(725.7	)		172.7			214.6			82.9			688.3			(642.8	)
Per Common Share Data
Diluted income (loss) per common share		2.14			3.04			(0.99	)		5.17			(7.39	)		1.72			2.14			0.84			6.89			(6.54	)
Book value per common share		55.58			53.41			52.97									56.97			55.58			53.17
Tangible book value per common share		54.39			52.13			49.93									55.86			54.39			50.29
Dividends declared per common share		0.35			0.35			0.35			0.70			0.70			0.35			0.35			0.35			1.05			1.05
Dividend payout ratio		16.4	%		11.5	%	NM				13.5	%	NM				20.4	%		16.4	%		41.6	%		15.3	%	NM
Performance Ratios
Return (available to common shareholders) on average common stockholders' equity		14.48	%		22.99	%	NM				17.40	%	NM
Return (available to common shareholders) on average tangible common stockholders' equity		16.73	%		24.07	%	NM				20.35	%	NM
Return (available to common shareholders; continuing operations) on average common stockholders' equity																	11.28	%		14.48	%		6.35	%		14.98	%	NM
Return (available to common shareholders; continuing operations) on average tangible common stockholders' equity																	13.04	%		16.73	%		7.24	%		17.82	%	NM
Net finance revenue as a percentage of average earning assets		2.45	%		2.46	%		2.14	%		2.45	%		2.42	%		2.44	%		2.45	%		2.27	%		2.45	%		2.37	%
Return (available to common shareholders) on AEA		1.66	%		2.26	%	NM				1.96	%	NM
Return (available to common shareholders; continuing operations) on AEA																	1.37	%		1.66	%		0.57	%		1.77	%	NM
Average total equity to average total asset ratio		10.9	%		10.3	%		9.7	%		10.6	%		10.5	%		11.6	%		10.9	%		9.5	%		10.9	%		10.2	%
Balance Sheet Data
Loans including receivables pledged	$	33,711.1		$	34,957.5		$	37,518.3								$	33,461.0		$	33,711.1		$	37,319.6
Allowance for credit losses		(850.6	)		(942.3	)		(1,202.7	)								(790.4	)		(850.6	)		(1,206.2	)
Operating lease equipment, net		7,781.8			7,733.4			7,778.1									7,937.5			7,781.8			7,799.3
Goodwill		-			-			146.8									-			-			140.4
Total cash and deposits		5,280.7			5,348.6			8,080.3									4,598.5			5,280.7			6,705.6
Investment securities		5,295.8			4,937.9			5,656.5									5,775.2			5,295.8			6,608.8
Total assets		54,703.7			56,049.1			61,702.4									54,420.0			54,703.7			60,865.0
Deposits		41,271.0			42,024.7			45,815.2									40,237.3			41,271.0			44,706.2
Borrowings		4,244.1			4,839.7			7,597.9									4,247.6			4,244.1			7,284.7
Total common stockholders’ equity		5,510.8			5,290.7			5,214.3									5,649.6			5,510.8			5,239.0
Credit Quality
Non-accrual loans as a percentage of loans		1.63	%		1.90	%		1.48	%								1.21	%		1.63	%		1.73	%
Net charge-offs as a percentage of average loans		0.30	%		0.15	%		1.79	%		0.23	%		1.18	%		0.06	%		0.30	%		0.71	%		0.17	%		1.02	%
Allowance for credit losses as a percentage of loans		2.52	%		2.70	%		3.21	%								2.36	%		2.52	%		3.23	%
Capital Ratios
CET1 capital ratio		11.6	%		10.9	%		10.0	%								11.9	%		11.6	%		9.9	%
Tier 1 capital ratio		12.7	%		11.9	%		11.0	%								13.0	%		12.7	%		10.9	%
Total capital ratio		15.0	%		14.2	%		13.2	%								15.3	%		15.0	%		13.1	%

~~The SEC has regulations that apply to any public disclosure or release of material information that includes a~~Management uses non-GAAP financial ~~measure.~~measures that it believes to be useful in assessing the Company’s financial condition and results of operations. A non-GAAP financial measure is a numerical measure of a company’s historical or future financial performance or financial position that may either exclude or include amounts or is adjusted in some way to the effect of including or excluding amounts, as compared to the most directly comparable measure calculated and presented in accordance with GAAP financial statements. These non-GAAP measures are not in accordance with, or a substitute for, GAAP and may be different from or inconsistent with non-GAAP financial measures used by other institutions.

The accompanying MD&A contains non-GAAP financial measures. We intend our non-GAAP financial measures to provide transparency about, or an alternate means of assessing, our operating results and financial position for our investors and analysts, on the same basis that our management analyzes such results.

Whenever we refer to a non-GAAP financial measure, we generally define it, or present the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP, along with a reconciliation of the differences between the U.S. GAAP financial measure and the non-GAAP financial measure. In instances when the non-GAAP balance is an aggregation of various line items from a financial statement, we present those exact line item names and balances for the user to clearly see the components. We ~~also~~ describe ~~the measure~~each of these measures below and explain why we believe the measure to be useful.

Total net revenue is a non-GAAP measure that represents the combination of NFR and other non-interest income and is an aggregation of all sources of revenue for the Company. The source of the data is various statement of operations line items, arranged in a different order and with different subtotals than included in the statement of operations, and therefore is considered non-GAAP. Total net revenue is used by management to monitor business performance and to calculate a net efficiency ratio, as discussed below in item 2.

NFR is a non-GAAP measure that represents the level of ~~revenue~~interest income earned on our loans and leases, ~~interest income on our~~ investment securities and cash, plus rental income on operating lease equipment less interest expense and expenses relating to operating lease equipment. NFR is a key performance measure used by management to monitor portfolio performance. NFR is also used to calculate a performance metric, net finance margin, or NFM.

Due to the nature of our loans and leases, which include a higher proportion of operating lease equipment than most BHCs, certain financial measures commonly used by other BHCs are not as meaningful for our Company. As such, given our asset composition includes a high level of operating lease equipment, NFM as calculated below is used by management, rather than net interest margin (“NIM”) (a common metric used by other bank holding companies), which does not fully reflect the earnings of our portfolio because it includes the impact of debt costs of all our assets but excludes the net operating lease revenue.

Net operating lease revenue is a non-GAAP measure that represents the combination of rental income on operating leases less depreciation on operating lease equipment and maintenance and other operating lease expenses. Net operating lease revenues is a measurement used by management to monitor portfolio performance and returns on its purchased equipment.

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Interest income	$	373.1		$	388.1		$	446.9		$	761.2		$	960.5		$	359.8		$	373.1		$	423.3		$	1,121.0		$	1,383.8
Rental income on operating lease equipment		188.2			194.7			200.9			382.9			410.7			186.2			188.2			201.3			569.1			612.0
Finance revenue (Non-GAAP)		561.3			582.8			647.8			1,144.1			1,371.2			546.0			561.3			624.6			1,690.1			1,995.8
Interest expense		106.8			119.6			202.5			226.4			428.2			103.0			106.8			165.5			329.4			593.7
Depreciation on operating lease equipment		82.8			84.7			81.1			167.5			159.4			85.1			82.8			82.5			252.6			241.9
Maintenance and other operating lease expenses		54.8			51.6			56.1			106.4			109.7			50.5			54.8			48.6			156.9			158.3
Net finance revenue (NFR) (Non-GAAP)		316.9			326.9			308.1			643.8			673.9			307.4			316.9			328.0			951.2			1,001.9
Other non-interest income		160.7			229.9			102.6			390.6			233.2			124.7			160.7			146.0			515.3			379.2
Total net revenues (Non-GAAP)	$	477.6		$	556.8		$	410.7		$	1,034.4		$	907.1		$	432.1		$	477.6		$	474.0		$	1,466.5		$	1,381.1

NFR (Non-GAAP)	$	316.9		$	326.9		$	308.1		$	643.8		$	673.9		$	307.4		$	316.9		$	328.0		$	951.2		$	1,001.9
Net finance margin (NFR as a % of AEA)(NFM)(Non-GAAP)		2.45	%		2.46	%		2.14	%		2.45	%		2.42	%		2.44	%		2.45	%		2.27	%		2.45	%		2.37	%

Net Operating Lease Revenue
Rental income on operating leases	$	188.2		$	194.7		$	200.9		$	382.9		$	410.7		$	186.2		$	188.2		$	201.3		$	569.1		$	612.0
Depreciation on operating lease equipment		82.8			84.7			81.1			167.5			159.4			85.1			82.8			82.5			252.6			241.9
Maintenance and other operating lease expenses		54.8			51.6			56.1			106.4			109.7			50.5			54.8			48.6			156.9			158.3
Net operating lease revenue (Non-GAAP)	$	50.6		$	58.4		$	63.7		$	109.0		$	141.6		$	50.6		$	50.6		$	70.2		$	159.6		$	211.8

Operating expenses excluding restructuring costs and intangible asset amortization is a non-GAAP measure used by management to compare period over period expenses. We exclude restructuring costs and intangible amortization from operating expenses as they are charges resulting from our strategic initiatives and not our operating activity. In addition, we exclude other noteworthy items to monitor the underlying level of operating expenses and cost of generating revenue. Non-GAAP operating expenses are reconciled to GAAP in the ~~“Non-Interest Expenses”~~Non-Interest Expenses section table.

Net efficiency ratio is another key performance metric. Net efficiency ratio is a non-GAAP measurement used by management to measure the level of operating expenses (before restructuring costs and intangible amortization) to total net revenues. The base ratio is derived by dividing the operating expenses (before restructuring costs and intangible amortization) by total net revenue (see components in Item 1 above). A lower result reflects a more efficient use of our expenses to generate revenue.

We present a second net efficiency calculation that excludes other noteworthy items (restructuring costs are considered noteworthy items) in the numerator and denominator due to their episodic nature and size. Due to the exclusions of the items, both calculations are considered non-GAAP measures.

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Total net revenues (Non-GAAP)	$	477.6		$	556.8		$	410.7		$	1,034.4		$	907.1		$	432.1		$	477.6		$	474.0		$	1,466.5		$	1,381.1
Noteworthy items		-			(83.0	)		-			(83.0	)		-			13.2			—			—			(69.8	)		—
Total net revenues, excluding noteworthy items (Non-GAAP)	$	477.6		$	473.8		$	410.7		$	951.4		$	907.1		$	445.3		$	477.6		$	474.0		$	1,396.7		$	1,381.1
Net efficiency ratio (Non-GAAP)		52.5	%		47.7	%		76.6	%		49.9	%		70.6	%		60.2	%		52.5	%		60.6	%		53.0	%		67.2	%
Net efficiency ratio, excluding noteworthy items (Non-GAAP)		52.2	%		54.6	%		71.8	%		53.4	%		66.6	%		58.3	%		52.2	%		60.4	%		54.9	%		64.5	%

Earning asset balances (period end balances) displayed in the table below are directly derived from the respective line items in the balance sheet. These represent revenue generating assets, and the average (AEA) of which provides a basis for management performance calculations, such as NFM. The source of the data is various balance sheet line items, however, when aggregated, the total is considered non-GAAP. We net the credit balances of factoring clients as the correlated receivable is included in loans on the balance sheet but these generate commission income, which is non-interest income and does not impact either the NFR and NIM. The average balances are based on daily balances.

	Quarters Ended									Six Months Ended				Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,		June 30,		September 30,			June 30,			September 30,			September 30,		September 30,
	2021			2021			2020			2021		2020		2021			2021			2020			2021		2020
Average Earning Assets (Non-GAAP)	$	51,811.1		$	53,202.2		$	57,589.0		$	52,502.8	$	55,636.9	$	50,347.1		$	51,811.1		$	57,768.0		$	51,776.3	$	56,352.5

	June 30,			March 31,			June 30,							September 30,			June 30,			September 30,
Period End Earning Assets	2021			2021			2020							2021			2021			2020
Loans	$	33,711.1		$	34,957.5		$	37,518.3						$	33,461.0		$	33,711.1		$	37,319.6
Operating lease equipment, net		7,781.8			7,733.4			7,778.1							7,937.5			7,781.8			7,799.3
Assets held for sale		51.5			757.4			82.7							95.8			51.5			56.7
Credit balances of factoring clients		(1,530.5	)		(1,471.1	)		(989.1	)						(1,556.6	)		(1,530.5	)		(1,320.2	)
Interest-bearing cash		5,134.1			5,191.0			7,898.7							4,428.7			5,134.1			6,529.9
Investment securities and securities purchased under agreement to resell		5,445.8			5,012.9			5,756.5							5,875.2			5,445.8			6,608.8
Total earning assets (Non-GAAP)	$	50,593.8		$	52,181.1		$	58,045.2						$	50,241.6		$	50,593.8		$	56,994.1

Certain portfolios within the segments ~~were being managed and~~ are being either run-off or ~~sold, such as the LCM portfolio in Consumer Banking.~~sold. In order to gauge the underlying level of loans and leases, management will exclude ~~this portfolio~~these portfolios when comparing to prior periods. By excluding ~~this~~these portfolios from the total of loans, operating lease equipment and AHFS balances, ~~on the balance sheet,~~ this metric is considered non-GAAP, and is presented only to assist the reader in understanding how management views the underlying change in earning asset levels in aggregate. The following table reflects the average balances for the respective periods.

	Quarters Ended						Six Months Ended				Quarters Ended						Nine Months Ended
	June 30,		March 31,		June 30,		June 30,		June 30,		September 30,		June 30,		September 30,		September 30,		September 30,
	2021		2021		2020		2021		2020		2021		2021		2020		2021		2020
Total average loans (incl HFS, net of credit balances)	$	33,226.5	$	34,592.3	$	37,109.8	$	33,905.6	$	36,801.7	$	31,865.6	$	33,226.5	$	36,301.6	$	33,218.2	$	36,633.8
Total average operating lease equipment (incl HFS)		7,754.0		7,831.2		7,602.1		7,792.4		7,509.1		7,862.5		7,754.0		7,824.4		7,816.0		7,615.0
Total average loans and leases (Non-GAAP)		40,980.5		42,423.5		44,711.9		41,698.0		44,310.8		39,728.1		40,980.5		44,126.0		41,034.2		44,248.8
Average non-core portfolio, LCM		1,501.8		1,653.7		2,065.6		1,577.3		2,110.7		1,316.2		1,501.8		1,979.7		1,489.3		2,066.7
Average core loans and leases	$	39,478.7	$	40,769.8	$	42,646.3	$	40,120.7	$	42,200.1	$	38,411.9	$	39,478.7	$	42,146.3	$	39,544.9	$	42,182.1

~~TBV, also referred to as tangible common equity,~~Tangible Book Value (“TBV”), return on tangible common equity (“ROTCE”), and TBV per share are considered key financial performance measures by management, and are used by other financial institutions. TBV, as calculated and used by management, represents CIT’s common stockholders’ equity, less goodwill and intangible assets. See the Capital section (Tangible Book Value and per Share Amounts table) for calculation of TBV per share. TBV per share is calculated by dividing TBV by the outstanding number of common shares.

ROTCE measures CIT’s profitability applicable to common stockholders as a percentage of average tangible common equity. This measure is useful for evaluating the performance of CIT as it calculates the return available to common stockholders without the impact of intangible assets. The average adjusted tangible common equity is derived using averages of balances presented, based on daily balances for the period.

TBV, ROTCE and TBV per share are measurements used by management and ~~others~~other users of CIT’s financial data in assessing CIT’s

use of equity. We believe the use of ratios that utilize tangible equity provides additional useful information because they present measures of those assets that can generate income. In addition, we believe TBV, ROTCE and TBV per share are important measures for comparative purposes with other institutions, but are not defined under U.S. GAAP, and therefore are considered non-GAAP financial measures.

	Quarters Ended									Six Months Ended						Quarters Ended									Nine Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
	2021			2021			2020			2021			2020			2021			2021			2020			2021			2020
Total common shareholders' equity	$	5,510.8		$	5,290.7		$	5,214.3		$	5,510.8		$	5,214.3		$	5,649.6		$	5,510.8		$	5,239.0		$	5,649.6		$	5,239.0
Less: goodwill		-			-			146.8			-			146.8			—			—			140.4			—			140.4
Less: Intangible assets		118.1			126.5			151.8			118.1			151.8			110.0			118.1			143.4			110.0			143.4
Tangible common equity for ROTCE (Non-GAAP)	$	5,392.7		$	5,164.2		$	4,915.7		$	5,392.7		$	4,915.7		$	5,539.6		$	5,392.7		$	4,955.2		$	5,539.6		$	4,955.2
Average tangible common equity (Non-GAAP)	$	5,279.4		$	5,105.1		$	4,987.3		$	5,192.8		$	5,127.7		$	5,486.3		$	5,279.4		$	4,927.9		$	5,291.7		$	5,060.6

Income (loss) from continuing operations available to common shareholders	$	214.6		$	301.0		$	(97.6	)	$	515.6		$	(725.7	)
Income (loss) available to common shareholders																$	172.7		$	214.6		$	82.9		$	688.3		$	(642.8	)
Goodwill impairment, after tax		-			-			-			-			339.0			—			—			—			—			339.0
Intangible asset amortization, after tax		6.2			6.2			4.0			12.7			12.4			6.1			6.2			6.3			18.9			18.5
Non-GAAP income (loss) from continuing operations - for ROTCE calculation	$	220.8		$	307.2		$	(93.6	)	$	528.3		$	(374.3	)
Non-GAAP income (loss) - for ROTCE calculation																$	178.8		$	220.8		$	89.2		$	707.2		$	(285.3	)
Return on average tangible common equity (Non-GAAP)		16.73	%		24.07	%	NM				20.35	%	NM				13.04	%		16.73	%		7.24	%		17.82	%	NM
Non-GAAP income (loss) from continuing operations (from the following non-GAAP noteworthy tables)	$	209.8		$	244.6		$	(61.4	)	$	454.4		$	(299.8	)
Non-GAAP income (loss) (from the following non-GAAP noteworthy tables)																$	185.2		$	209.8		$	82.7		$	639.6		$	(217.1	)
Intangible asset amortization, after tax		6.2			6.2			4.0			12.7			12.4			6.1			6.2			6.3			18.9			18.5
Non-GAAP income (loss) from continuing operations - for ROTCE calculation, excluding noteworthy items	$	216.0		$	250.8		$	(57.4	)	$	467.1		$	(287.4	)
Non-GAAP income (loss) - for ROTCE calculation, excluding noteworthy items																$	191.3		$	216.0		$	89.0		$	658.5		$	(198.6	)
Preferred dividend normalization		4.7			(4.7	)		4.7			-			-			(4.7	)		4.7			(4.7	)		(4.7	)		(4.7	)
Non-GAAP (loss) income from continuing operations - for ROTCE calculation, excluding noteworthy items and preferred dividend normalization	$	220.7		$	246.1		$	(52.7	)	$	467.1		$	(287.4	)
Non-GAAP income (loss) - for ROTCE calculation, excluding noteworthy items and preferred dividend normalization																$	186.6		$	220.7		$	84.3		$	653.8		$	(203.3	)
Return on average tangible common equity, after noteworthy items (Non-GAAP)		16.37	%		19.65	%	NM				17.99	%	NM				13.95	%		16.37	%		7.22	%		16.59	%	NM
Return on average tangible common equity, after noteworthy items and preferred dividend normalization		16.72	%		19.28	%	NM				17.99	%	NM				13.60	%		16.72	%		6.84	%		16.47	%	NM

Net income (loss) excluding noteworthy items are non-GAAP measures, as the measures exclude items from the respective line item in the GAAP statement of operations. ~~The Company believes~~We exclude noteworthy items to reflect how management views the underlying performance of the business and believe that adjusting for these items ~~provides~~will also provide the user of CIT’s financial information a measure of the underlying ~~performance of the Company.~~performance. The non-GAAP noteworthy items are summarized in the following categories: significant due to the size of the transaction; transactions pertaining to items no longer considered core to CIT’s on-going operations (e.g. sales of non-strategic portfolios); and other items, such as restructuring costs or costs incurred specific to mergers and acquisitions.

Net Income (Loss) Available to Common Shareholders, Excluding Noteworthy Items (dollars in millions, except per share data)

			Pre-tax						After-Tax			Per					Pre-tax						After-Tax			Per
															Description	Line Item	Balance			Tax⁽²⁾			Balance			Share
Quarter Ended September 30, 2021															Quarter Ended September 30, 2021
Net income available to common shareholders															Net income available to common shareholders								$	172.7		$	1.72
															CTA release	Other non-interest income	$	13.2		$	(1.1	)		12.1			0.12
															FCB merger costs	Operating expenses		0.7			(0.3	)		0.4			0.00
Non-GAAP net income available to common shareholders, excluding noteworthy items⁽¹⁾															Non-GAAP net income available to common shareholders, excluding noteworthy items⁽¹⁾								$	185.2		$	1.84
	Description	Line Item	Balance			Tax⁽²⁾			Balance			Share
Quarter Ended June 30, 2021	Quarter Ended June 30, 2021														Quarter Ended June 30, 2021
Net income available to common shareholders	Net income available to common shareholders								$	214.6		$	2.14		Net income available to common shareholders								$	214.6		$	2.14
	Reversal of prior restructuring costs	Operating expenses	$	(7.9	)	$	1.8			(6.1	)		(0.06	)	Reversal of prior restructuring costs	Operating expenses	$	(7.9	)	$	1.8			(6.1	)		(0.06	)
	FCB merger costs	Operating expenses		1.7			(0.4	)		1.3			0.01		FCB merger costs	Operating expenses		1.7			(0.4	)		1.3			0.01
Non-GAAP net income available to common shareholders, excluding noteworthy items⁽¹⁾									$	209.8		$	2.09
Non-GAAP income available to common shareholders, excluding noteworthy items⁽¹⁾															Non-GAAP income available to common shareholders, excluding noteworthy items⁽¹⁾								$	209.8		$	2.09

Quarter Ended March 31, 2021
Quarter Ended September 30, 2020															Quarter Ended September 30, 2020
Net income available to common shareholders	Net income available to common shareholders								$	301.0		$	3.04		Net income available to common shareholders								$	82.9		$	0.84
	Gains on sales of investment securities	Other non-interest income	$	(83.0	)	$	21.5			(61.5	)		(0.62	)	MOB merger and integration costs	Operating expenses	$	12.6		$	(3.8	)		8.8			0.09
	FCB merger costs	Operating expenses		6.9			(1.8	)		5.1			0.05		Performance Stock Units expense reversal	Operating expenses		(12.1	)		3.1			(9.0	)		(0.09	)
Non-GAAP income available to common shareholders, excluding noteworthy items⁽¹⁾									$	244.6		$	2.47

Quarter Ended June 30, 2020
Net loss available to common shareholders									$	(97.6	)	$	(0.99	)
	Restructuring charges	Operating expenses	$	37.2		$	(13.6	)		23.6			0.24
	MOB merger and integration costs	Operating expenses		19.9			(7.3	)		12.6			0.13
Non-GAAP net loss available to common shareholders, excluding noteworthy items⁽¹⁾									$	(61.4	)	$	(0.62	)

Non-GAAP net income available to common shareholders, excluding noteworthy items(1)															Non-GAAP net income available to common shareholders, excluding noteworthy items(1)								$	82.7		$	0.84


			Pre-tax						After-Tax			Per					Pre-tax						After-Tax			Per
	Description	Line Item	Balance			Tax⁽²⁾			Balance			Share			Description	Line Item	Balance			Tax⁽²⁾			Balance			Share
Six Months Ended June 30, 2021
Net loss available to common shareholders									$	515.6		$	5.17
	Gains on sales of investment securities	Other non-interest income	$	(83.0	)	$	21.5			(61.5	)		(0.62	)
	FCB merger costs	Operating expenses		8.6			(2.2	)		6.4			0.06
	Reversal of prior restructuring costs	Operating expenses		(7.9	)		1.8			(6.1	)		(0.06	)
Non-GAAP net loss available to common shareholders, excluding noteworthy items⁽¹⁾									$	454.4		$	4.56

Six Months Ended June 30, 2020
Nine Months Ended September 30, 2021															Nine Months Ended September 30, 2021
Net income available to common shareholders	Net income available to common shareholders								$	(725.7	)	$	(7.39	)	Net income available to common shareholders								$	688.3		$	6.89
	MOB day 1 provision for credit losses	Provision for credit losses	$	44.8		$	(8.1	)		36.7			0.37		Gains on sales of investment securities	Other non-interest income	$	(83.0	)	$	21.5			(61.5	)		(0.62	)
	Restructuring charges	Operating expenses		37.2			(13.6	)		23.6			0.24		CTA release	Other non-interest income		13.2			(1.1	)		12.1			0.12
	MOB merger and integration costs	Operating expenses		37.0			(10.4	)		26.6			0.27		FCB merger costs	Operating expenses		9.3			(2.5	)		6.8			0.07
	Goodwill impairment	Goodwill impairment		344.7			(5.7	)		339.0			3.45		Reversal of prior restructuring costs	Operating expenses		(7.9	)		1.8			(6.1	)		(0.06	)
Non-GAAP net income available to common shareholders, excluding noteworthy items⁽¹⁾	Non-GAAP net income available to common shareholders, excluding noteworthy items⁽¹⁾								$	(299.8	)	$	(3.05	)	Non-GAAP net income available to common shareholders, excluding noteworthy items⁽¹⁾								$	639.6		$	6.40

Nine Months Ended September 30, 2020															Nine Months Ended September 30, 2020
Net loss available to common shareholders															Net loss available to common shareholders								$	(642.8	)	$	(6.54	)
															MOB day 1 provision for credit losses	Provision for credit losses	$	44.8		$	(8.1	)		36.7			0.37
															Performance Stock Units expense reversal	Operating expenses		(12.1	)		3.1			(9.0	)		(0.09	)
															Restructuring charges	Operating expenses		37.2			(13.6	)		23.6			0.24
															MOB merger and integration costs	Operating expenses		49.6			(14.2	)		35.4			0.36
															Goodwill impairment	Goodwill impairment		344.7			(5.7	)		339.0			3.45
Non-GAAP net loss available to common shareholders, excluding noteworthy items⁽¹⁾															Non-GAAP net loss available to common shareholders, excluding noteworthy items⁽¹⁾								$	(217.1	)	$	(2.21	)

The provision for income taxes before noteworthy items and tax discrete items and the respective effective tax rate are non-GAAP measures, which management uses for analytical purposes to understand the Company’s underlying tax rate. Noteworthy items are presented in item 5 above, and discussed in various sections of the MD&A. ~~The tax discrete items are referenced in~~ ~~Note 12 — Income Taxes~~.

	Quarters Ended								Six Months Ended					Quarters Ended									Nine Months Ended
	June 30,		March 31,			June 30,			June 30,		June 30,			September 30,			June 30,			September 30,			September 30,			September 30,
	2021		2021			2020			2021		2020			2021			2021			2020			2021			2020
Provision (benefit) for income taxes - GAAP	$ 71.7		$	96.3		$	(73.2	)	$ 168.0		$	(145.5	)	$	55.5		$	71.7		$	29.5		$	223.5		$	(116.0	)
Income tax on noteworthy items	(1.4	)		(19.7	)		20.9		(21.1	)		37.8			1.4			(1.4	)		0.7			(19.7	)		38.5
Provision (benefit) for income taxes, excluding noteworthy items - Non-GAAP	70.3			76.6			(52.3	)	146.9			(107.7	)
Provision (benefit) for income taxes, before noteworthy items - Non-GAAP															56.9			70.3			30.2			203.8			(77.5	)
Income tax - remaining discrete items	4.0			7.3			(1.1	)	11.3			1.9			4.8			4.0			(0.1	)		16.1			1.8
(Benefit) provision for income taxes, excluding noteworthy and tax discrete items - Non-GAAP	$ 74.3		$	83.9		$	(53.4	)	$ 158.2		$	(105.8	)
(Loss) income from continuing operations before provision for income taxes	$ 298.6		$	400.1		$	(158.5	)	$ 698.7		$	(855.1	)
Provision (benefit) for income taxes, before noteworthy and discrete tax items - Non-GAAP														$	61.7		$	74.3		$	30.1		$	219.9		$	(75.7	)
Income (loss) before (benefit) provision for income taxes - GAAP														$	231.0		$	298.6		$	115.2		$	929.7		$	(739.9	)
Noteworthy items before tax	(6.2	)		(76.1	)		57.1		(82.3	)		463.7			13.9			(6.2	)		0.5			(68.4	)		464.2
Adjusted (loss) income from continuing operations before provision for income taxes and discrete items - Non-GAAP	$ 292.4		$	324.0		$	(101.4	)	$ 616.4		$	(391.4	)
Adjusted income (loss) before (benefit) provision for income taxes and discrete items - Non-GAAP														$	244.9		$	292.4		$	115.7		$	861.3		$	(275.7	)
Effective tax rate	24.0%			24.1	%		46.2	%	24.0%			17.0	%		24.0	%		24.0	%		25.6	%		24.0	%		15.7	%
Effective tax rate, excluding noteworthy items - Non-GAAP	24.0%			23.6	%		51.6	%	23.8%			27.5	%		23.2	%		24.0	%		26.1	%		23.7	%		28.1	%
Effective tax rate, excluding noteworthy and tax discrete items - Non-GAAP	25.4%			25.9	%		52.7	%	25.7%			27.0	%		25.2	%		25.4	%		26.0	%		25.5	%		27.4	%

Included within this Form 10-Q are risk-weighted assets, risk-based capital and leverage ratios as calculated under the Basel III Rule, the Simplification Final Rule and the Revised CECL Transition Rule as of ~~June~~September 30, 2021 and December 31, 2020. Such measures are considered key regulatory capital measures used by banking regulators, investors and analysts to assess CIT’s (as a BHC) regulatory capital position and to compare CIT to other financial institutions. For information on our capital ratios and requirements, see the ~~“Capital”~~Capital section.

Certain statements contained in this document are “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, as amended. All statements contained herein that are not clearly historical in nature are forward-looking and the words “anticipate,” “believe,” “could,” “expect,” “estimate,” “forecast,” “intend,” “plan,” “potential,” “project,” “target” and similar expressions are generally intended to identify forward-looking statements. Any forward-looking statements contained herein, in press releases, written statements or other documents filed with the Securities and Exchange Commission or in communications and discussions with investors and analysts in the normal course of business through meetings, webcasts, phone calls and conference calls, concerning our operations, economic performance and financial condition are subject to known and unknown risks, uncertainties and contingencies. Forward-looking statements are included, for example, in the discussions about:

Forward-looking statements also include statements relating to our continuing response to the COVID-19 pandemic. These statements include, but are not limited to, statements about:

All forward-looking statements involve risks and uncertainties, many of which are beyond our control, which may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements expressed or implied in these statements. Forward-looking statements are based upon management’s estimates of fair values and of future costs, using currently available information. Factors that could cause such differences include, but are not limited to:

Any or all of our forward-looking statements here or in other publications may turn out to be wrong, and there are no guarantees regarding our performance. We do not assume any obligation to update any forward-looking statement for any reason.

Under the supervision of and with the participation of management, including our principal executive officer and principal financial officer, we evaluated the effectiveness of our disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities and Exchange Act of 1934, (the “Exchange Act”) as of ~~June~~September 30, 2021. Based on such evaluation our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective.

There were no changes in our internal control over financial reporting that occurred during the quarter ended ~~June~~September 30, 2021, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

See Note 14 — Contingencies, in the Notes to the unaudited interim Condensed Consolidated Financial Statements in Part I,One, Item 1 — Financial Statements, which is incorporated by reference into this item.

Risk factors remain unchanged during the quarter. For a discussion of risk factors, see Part I, Item 1A. Risk Factors, of CIT’s 2020 Form 10-K, and Forward-Looking Statements of this Form 10-Q.

There were no repurchases of our common stock during the quarter ended ~~June~~September 30, 2021.

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

☒	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934		☐	Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the quarterly period ended ~~June~~September 30, 2021

Delaware (State or other jurisdiction of incorporation or organization)		65-1051192 (IRS Employer Identification Number)

11 West 42nd Street, New York, New York (Address of Registrant’s principal executive offices)		10036 (Zip Code)

(212) 461-5200 (Registrant’s telephone number)


Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	CIT	New York Stock Exchange
5.625% Non-Cumulative Perpetual Preferred Stock, Series B, par value $0.01 per share	CITPRB	New York Stock Exchange


Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer	☐
Smaller reporting company	☐	Emerging growth company	☐

CONTENTS

Part One — Financial Information:

Item 1.	Financial Statements	2
	Condensed Consolidated Balance Sheets (Unaudited)	2
	Condensed Consolidated Statements of Operations (Unaudited)	3
	Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)	4
	Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)	5
	Condensed Consolidated Statements of Cash Flows (Unaudited)	6
	Notes to Condensed Consolidated Financial Statements (Unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	38
	and
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	38
Item 4.	Controls and Procedures	77

Part Two — Other Information:

Item 1.	Legal Proceedings	78
Item 1A.	Risk Factors	78
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	78
Item 4.	Mine Safety Disclosures	78
Item 6.	Exhibits	79
Signatures		81

	June 30, 2021		December 31, 2020
Commercial loans	$	26,063.3	$	27,410.9
Financing leases and leverage leases		2,187.1		2,318.0
Total commercial		28,250.4		29,728.9
Consumer loans		5,460.7		6,415.7
Total loans	$	33,711.1	$	36,144.6

	S&P	Fitch	Moody’s
Last Credit Update	12/10/20	11/~~6/20~~2/21	10/~~28/20~~1/21
CIT Group Inc.
Long Term Senior Unsecured Debt	BB+	BBB-	Ba1
Subordinated Debt	BB	BB+	Ba1
Non-Cumulative Perpetual Stock	B+	B+	Ba3
Ratings Outlook / Trend	Positive (Watch)	Positive (Watch)	Upgrade (Review)
CIT Bank, N.A.
Issuer Rating	BBB-	BBB-	Ba1
Long Term Senior Bank Notes	BBB-	BBB-	Ba1
Deposit Rating (LT/ST)	N/A	BBB / F3	Baa1 / P-2
Outlook	Positive (Watch)	Positive (Watch)	Upgrade (Review)

2.1		Agreement and Plan of Merger, by and among CIT Group Inc., IMB HoldCo LLC, Carbon Merger Sub LLC and JCF III HoldCo I L.P., dated as of July 21, 2014 (incorporated by reference to Exhibit 2.1 to Form 8-K filed July 25, 2014).
2.2		Amendment No. 1, dated as of July 21, 2015, to the Agreement and Plan of Merger, by and among CIT Group Inc., IMB HoldCo I L.P., Carbon Merger Sub LLC and JCF III HoldCo I L.P., dated as of July 21, 2014 (incorporated by reference to Exhibit 2.1 to Form 8-K filed July 27, 2015).
2.3		Agreement and Plan of Merger among Mutual of Omaha Insurance Company, Omaha Financial Holdings, Inc. Mutual of Omaha Bank, CIT Group Inc. and CIT Bank National Association, dated as of August 12, 2019 (incorporated by reference to Exhibit 2.1 to Form 8-K filed August 16, 2019).
2.4		Agreement and Plan of Merger, dated as of October 15, 2020, by and among First Citizens BancShares, Inc., First-Citizens Bank & Trust Company, FC Merger Subsidiary IX, Inc., and CIT Group Inc. (incorporated by reference to Exhibit 2.1 to Form 8-K filed October 20, 2020).
3.1		Fourth Restated Certificate of Incorporation of the Company, as filed with the Office of the Secretary of State of the State of Delaware on May 17, 2016 (incorporated by reference to Exhibit 3.1 to Form 8-K filed May 17, 2016).
3.2		Amended and Restated By-laws of the Company, as amended through April 15, 2020 (incorporated by reference to Exhibit 3.2 to Form 10-Q filed May 5, 2020).
3.3		Certificate of Designation of Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series A of CIT Group Inc., dated June 6, 2017 (incorporated by reference to Exhibit 3.1 to Form 8-K filed June 7, 2017).
3.4		Certificate of Designation of 5.625% Non-Cumulative Perpetual Preferred Stock, Series B of CIT Group Inc. (incorporated by reference to Exhibit 3.3 to our Form 8-A filed November 12, 2019).
4.1		Indenture, dated as of January 20, 2006, between CIT Group Inc. and The Bank of New York Mellon (as successor to JPMorgan Chase Bank N.A.) for the issuance of senior debt securities (incorporated by reference to Exhibit 4.3 to Form S-3 filed January 20, 2006).
4.2		Indenture, dated as of March 15, 2012, among CIT Group Inc., Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company Americas, as paying agent, security registrar and authenticating agent (incorporated by reference to Exhibit 4.1 of Form 8-K filed March 16, 2012).
4.3		Third Supplemental Indenture, dated as of August 3, 2012, among CIT Group Inc., Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company Americas, as paying agent, security registrar and authenticating agent (including the Form of 4.25% Senior Unsecured Note due 2017 and the Form of 5.00% Senior Unsecured Note due 2022) (incorporated by reference to Exhibit 4.2 to Form 8-K filed August 3, 2012).
4.4		Fourth Supplemental Indenture, dated as of August 1, 2013, among CIT Group Inc., Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company Americas, as paying agent, security registrar and authenticating agent (including the Form of 5.00% Senior Unsecured Note due 2023) (incorporated by reference to Exhibit 4.2 to Form 8-K filed August 1, 2013).
4.5		Seventh Supplemental Indenture, dated as of March 9, 2018, by and among CIT Group Inc., Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company Americas, as paying agent, security registrar and authenticating agent (including the Form of 4.125% Senior Unsecured Notes due 2021 and Form of 5.250% Senior Unsecured Notes due 2025) (incorporated by reference to Exhibit 4.2 to Form 8-K filed March 12, 2018).
4.6		Subordinated Indenture, dated as of March 9, 2018, between CIT Group Inc., Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company Americas, as paying agent, security registrar and authenticating agent (incorporated by reference to Exhibit 4.3 to Form 8-K filed March 12, 2018).
4.7		First Supplemental Indenture, dated as of March 9, 2018, between CIT Group Inc., Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company Americas, as paying agent, security registrar and authenticating agent (including the Form of 6.125% Subordinated Notes due 2028) (incorporated by reference to Exhibit 4.4 to Form 8-K filed March 12, 2018).
4.8		Eighth Supplemental Indenture, dated as of August 17, 2018 by and among CIT Group Inc., Wilmington Trust National Association as trustee and Deutsche Bank Trust Company Americas, as paying agent, security registrar and authenticating agent (including the Form of 4.750% Senior Unsecured Notes due 2024) (incorporated by reference to Exhibit 4.2 of Form 8-K filed August 17, 2018).
4.9		Second Supplemental Indenture, dated as of November 13, 2019, between CIT Group Inc., Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company Americas, as paying agent, security registrar and authenticating agent (including the Form of 4.125% Fixed-to-Fixed Rate Subordinated Notes due 2029) (incorporated by reference to Exhibit 4.2 on Form 8-K filed November 13, 2019).
4.10		Description of CIT Group Inc.’s Securities Registered under Section 12 of the Exchange Act Certain instruments defining the rights of holders of long-term debt securities of CIT and its subsidiaries are omitted pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K (incorporated by reference to Exhibit 4.10 to Form 10-K filed on February 20, 2020). CIT hereby undertakes to furnish to the SEC, upon request, copies of such instruments.
4.11		Ninth Supplemental Indenture, dated as of June 19, 2020, among CIT Group Inc., Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company Americas, as paying agent, security registrar and authenticating agent (including the Form of 3.929% Senior Unsecured Fixed-to-Floating Rate Note due 2024). (incorporated by reference to Exhibit 4.2 to Form 8-K filed June 19, 2020).
10.1*		CIT Group Inc. Omnibus Incentive Plan (incorporated by reference to exhibit 10.1 to Form 10-Q filed November 2, 2018).
10.2*		CIT Group Inc. Supplemental Retirement Plan (As Amended and Restated Effective as of January 1, 2008) (incorporated by reference to Exhibit 10.27 to Form 10-Q filed May 12, 2008).
10.3*		CIT Group Inc. Supplemental Savings Plan (As Amended and Restated Effective as of January 1, 2008) (incorporated by reference to Exhibit 10.28 to Form 10-Q filed May 12, 2008).
10.4*		New Executive Retirement Plan of CIT Group Inc. (As Amended and Restated as of January 1, 2008) (incorporated by reference to Exhibit 10.29 to Form 10-Q filed May 12, 2008).
10.5*		Form of CIT Group Inc. Long-term Incentive Plan Restricted Stock Unit Director Award Agreement (Annual Grant) (incorporated by reference to Exhibit 10.40 to Form 10-Q filed August 9, 2010).
10.6		Stockholders Agreement, by and among CIT Group Inc. and the parties listed on the signature pages thereto, dated as of July 21, 2014 (incorporated by reference to Exhibit 10.1 to Form 8-K filed July 25, 2014).

10.7*		Offer Letter, dated October 26, 2015, between CIT Group Inc. and Ellen R. Alemany, including Attached Exhibits. (incorporated by reference to Exhibit 10.39 to Form 10-Q filed November 13, 2015).
10.8		CIT Employee Severance Plan (As Amended and Restated Effective January 1, 2017) (incorporated by reference to Exhibit 10.40 to Form 10-Q filed November 9, 2016).
10.9		Form of CIT Group Inc. Omnibus Incentive Plan Restricted Stock Unit Director Award Agreement (Three Year Vesting) (incorporated by reference to Exhibit 10-48 to Form 10-K filed on March 16, 2017).
10.10		Form of CIT Group Inc. Omnibus Incentive Plan Performance Share Unit Award Agreement (2018) (incorporated by reference to Exhibit 10.23 to Form 10-Q filed May 4, 2018).
10.11		Form of CIT Group Inc. Omnibus Incentive Plan Restricted Stock Unit Award Agreement (with performance Based Vesting) (2018) (incorporated by reference to Exhibit 10.24 to Form 10-Q filed May 4, 2018).
10.12		Amendment No. 4 to Second Amended and Restated Revolving Credit and Guaranty Agreement, dated as of March 9, 2020, among CIT Group Inc., certain subsidiaries of CIT Group Inc., as Guarantors, the Lenders party thereto from time to time and Bank of America, N.A., as Administrative Agent and L/C Issuer (incorporated by reference to Exhibit 10.14 to Form 10-Q filed May 5, 2020).
10.13		Form of CIT Group Inc. Omnibus Incentive Plan Performance Share Unit Award Agreement (2019) (incorporated by reference to Exhibit 10.19 to Form 10-Q filed May 3, 2019).
10.14		Form of CIT Group Inc. Omnibus Incentive Plan Restricted Stock Unit Award Agreement (with performance Based Vesting) (2019) (incorporated by reference to Exhibit 10.20 to Form 10-Q filed May 3, 2019).
10.15		Form of CIT Group Inc. Omnibus Incentive Plan Performance Share Unit Award Agreement (2020) (incorporated by reference to Exhibit 10.17 to Form 10-Q filed May 5, 2020).
10.16		Form of CIT Group Inc. Omnibus Incentive Plan Restricted Stock Unit Award Agreement (with performance Based Vesting) (2020) (incorporated by reference to Exhibit 10.18 to Form 10-Q filed May 5, 2020).
10.17		Voting Agreement, dated as of October 15, by and among CIT Group Inc., Frank B. Holding, Jr., Hope H. Bryant, Peter M. Bristow, and Claire H. Bristow (incorporated by reference to Exhibit 10.1 to Form 8-K filed October 20, 2020).
10.18		Form of Severance Amendment Letter, dated October 19, 2020, from CIT Group, Inc. (incorporated by reference to Exhibit 99.1 to Form 8-K filed October 20, 2020).
10.19		Form of CIT Group Inc. Retention Award Agreement (incorporated by reference to Exhibit 10.21 to Form 10-K filed February 19, 2021).

31.1		Certification of Ellen R. Alemany pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Commission, as promulgated pursuant to Section 13(a) of the Securities Exchange Act and Section 302 of the Sarbanes-Oxley Act of 2002. (filed herein)
31.2		Certification of John Fawcett pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Commission, as promulgated pursuant to Section 13(a) of the Securities Exchange Act and Section 302 of the Sarbanes-Oxley Act of 2002. (filed herein)
32.1**		Certification of Ellen R. Alemany pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (filed herein)
32.2**		Certification of John Fawcett pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (filed herein)
101		The following materials from CIT Group Inc.’s Quarterly Report on Form 10-Q for the quarter ended ~~June~~September 30, 2021, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Comprehensive Income (Loss), (iv) the Condensed Consolidated Statements of Changes in Stockholders' Equity, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) Notes to Condensed Consolidated Financial Statements.
104		The cover page from CIT Group Inc.’s Form 10-Q for the quarterly period ended ~~June~~September 30, 2021, formatted inline XBRL (contained in exhibit 101.1).


~~July 30,~~November 5, 2021	CIT GROUP INC.

	/s/ John Fawcett
	John Fawcett
	Executive Vice President and
	Chief Financial Officer

	/s/ Edward K. Sperling
	Edward K. Sperling
	Executive Vice President and Controller