As if 2009 hasn’t been a rough enough year for businesses in the U.S. – this past Sunday brought with it the prospect of even tougher days ahead for small and mid-sized business owners.
CIT Group , one of the nation’s largest providers of credit to small and mid sized companies, declared bankruptcy after months of struggling to avoid collapse. While the company said it’s lending operations will remain open as it heads through bankruptcy, some on Wall Street fear Sunday’s announcement adds further instability to one industry that’s already been under pressure: RETAILERS.
About 60% of the apparel industry depends on CIT for financing – with the company helping 2000 vendors supply merchandise to more than 300-thousand stores.
Sunday’s bankruptcy announcement comes as retailers gear up for the holiday season. And with so many stores dependent on CIT for financing, the big question on Wall Street is if the collapse of the lending giant will bring down companies within the retail sector.