CIT reported net income of $130 million for Q4/13, compared to net income of $207 million for Q4/12. Net income for the year ended December 31, 2013 was $676 million, compared to a net loss of $592 million, which included $1.5 billion of debt redemption charges, for the year ended December 31, 2012.

“In 2013, we returned CIT to profitability, grew CIT Bank and our commercial assets, while rationalizing our global platforms and returning capital to shareholders,” said John Thain, chairman and chief executive officer. “We remain focused on enhancing the value of our franchise as we put our knowledge to work to meet the lending, leasing and advisory needs of our small business, middle market and transportation clients.”

The following commentary on the Transportation and Vendor Finance segments was excerpted from the news release:

Transportation Finance

Pre-tax earnings for the quarter were $133 million, down from $169 million in the year-ago quarter reflecting higher interest and depreciation expense, and from $161 million in the prior quarter as our portfolio management activities in commercial air resulted in lower non-spread revenue. Utilization remained strong with all but one commercial aircraft and over 98% of rail equipment on lease or under a commitment to lease at period-end.

Financing and leasing assets totaled $15.1 billion at December 31, 2013, up $0.8 billion sequentially reflecting growth in all business units and $0.9 billion from a year ago. During the quarter we took delivery of 11 new aircraft and approximately 1,800 railcars and funded over $0.4 billion of loans. At the end of December 2013 we signed an agreement to purchase a European railcar leasing company with approximately 9,500 railcars that is expected to close during the first quarter of 2014.

All aircraft and railcars scheduled for delivery in the next twelve months have lease commitments. A higher than usual number of aircraft will be subject to lease renewals in 2014, which could put pressure on the operating lease margin.

Vendor Finance

Pre-tax earnings for the quarter were $5 million and continued to be impacted by our international platform rationalization efforts, compared to $47 million in the year-ago period and $8 million in the prior quarter. The decline from the year-ago quarter reflects lower net finance income, higher credit costs and lower net FSA accretion, which more than offset lower operating expenses in the current quarter. The decline from the prior quarter reflects lower net rental income due to the sale of the Dell Europe portfolio and higher credit costs, partially offset by higher other income and lower expenses. Pre-tax income for the quarter included a $29 million gain on the sale of the remaining Dell Europe portfolio, which was partially offset by $22 million in impairments on assets held for sale related to our international platform rationalization efforts. The year-ago and sequential quarter comparisons also reflected the impact of the Dell Europe sales on net finance revenue, as those assets had high yields. In aggregate, results continue to be negatively impacted by our International platforms while the U.S. business continues to be profitable and grow.

Financing and leasing assets declined modestly from September 30, 2013 to $5.3 billion and were down 2% from a year ago, reflecting nearly $400 million of assets sold this quarter, primarily related to the Dell Europe portfolio and, to a lesser extent, continued progress on our international platform rationalizations. Assets held for sale decreased to $438 million as reductions from portfolio sales were partially offset by the addition of other international assets. We funded $711 million of new business volume in the quarter, a decrease of 18% from the year-ago quarter and down 7% from the prior quarter reflecting the wind down of certain international platforms.

Credit metrics were also impacted by the platform rationalization efforts. Net charge-offs were $21 million and included $4 million of charge-offs related to loans transferred to assets held for sale, and lower recoveries, while net charge-offs of $19 million in the prior quarter included $7 million of charge-offs related to loans transferred to assets held for sale. Non-accrual loans were $96 million (2.02% of finance receivables) at quarter-end, compared to $96 million (1.98%) at September 30, 2013 and up from $72 million (1.49%) a year ago.

To read the full news release click here.