CIT Group pays $1.25 billion of debt

NEW YORK, June 26 (UPI) -- New York-based CIT Group has paid $1.25 billion of the debt that has burdened the company since it emerged from bankruptcy in April, filings showed.

The institution, a conduit of funds to small and midsized lenders, said it made the prepayment by selling assets and securitizing receivables, The Wall Street Journal reported.

The payment included a mandatory amount of $950 million, required under its credit agreement, and $300 million voluntary amount, paid to small businesses, filings with the Securities and Exchange Commission show.

The company was forced into bankruptcy in November by the credit crisis and reached a deal with lenders. It exited bankruptcy in December with a $7.5 billion credit facility it must repay.

In April, after seeing an improvement in liquidity and cash flow, the company had said it planned to make $1.5 billion in prepayments. Loan payments are cutting into the company's profitability.

The company reported a profit of $97.3 million in the first quarter.