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CIT Group

(CIT) - Get CIT Group Inc. Report

said Tuesday Jeffery Peek, its chairman and CEO, plans to leave the troubled lender at the end of the year.

The company, whose history stretches back more than a century, said its board is forming a search committee to oversee the recruitment process and ensure a "smooth" transition process. Peek's resignation is effective Dec. 31.

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"CIT's recently launched restructuring plan is designed to enhance its capital levels, bolster liquidity and return the Company to profitability," said Peek in a statement. "By strengthening CIT's financial position, the Company will advance its bank-centric model and invigorate its market-leading franchises which support the small business and middle market sectors of the economy."

Peek added that he plans to work closely with CIT's board during the transition process.

The news comes with CIT bondholders still pondering acceptance of a broad restructuring plan disclosed on Oct. 1 that would clear about $5.7 billion from the company's balance sheet and allow it to avoid filing for bankruptcy protection. The holders of roughly $10 billion in CIT debt have already indicated they plan to support the swap, which will give current debt holders new equity and essentially wipe out current holders of the common stock. The debt exchange offer expires on Oct. 29.

CIT, which mainly lends to small and mid-sized businesses, has also put in place a prepackaged bankruptcy reorganization plan for bondholders to consider.

The stock closed Monday at $1.04, and was tracking more than 19% lower at 84 cents in premarket action following the announcement of Peek's plans to resign.

Written by Michael Baron in New York