CIT Group Inc.’s CIT bottom line is expected to be under pressure due to elevated costs. Moreover, worsening credit quality is a major concern for the company and will likely hamper financials.
Also, analysts are not optimistic regarding the company’s earnings growth prospects. Per the Zacks Consensus Estimate, the company will report a per share loss in the current year.
Looking at its fundamentals, non-interest expenses have witnessed a six-year (2014-2019) CAGR of 4.2%, primarily due to higher compensation costs, professional fees and technology costs. The uptrend continued in the first six months of 2020. While the company is on track to realize cost synergies related to the integration of Mutual of Omaha Bank, overall expenses are expected to remain elevated in the near term, given its strategic growth efforts and continued investments in franchise.
Moreover, CIT Group has witnessed a continued rise in provisions in the past few