Moody's And S&P Cut CIT Group Ratings

S&P said CIT's "funding flexibility continues to be somewhat challenged, given that its application for the FDIC's Temporary Liquidity Guarantee Program (TLGP) is still pending."

"CIT's inability to access TLGP during the first four months of 2009 has reduced the company's funding flexibility somewhat and constrained loan originations," S&P said. "These concerns are partially offset by the Federal Reserve's approval for CIT to begin transferring loan assets to CIT Bank."

The outlook is negative, which means CIT's ratings could be cut again if its assets or financial flexibility weaken further.

The stock dropped 32 cents, or 11.5 percent, to close at $2.46.