================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q
              (Mark One)
              (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended SEPTEMBER 30, 2000
                                               ------------------

                                       OR
              ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

           For the transition period from ___________ to ___________

                             Commission File Number
                                     1-1861
                                  ------------

                               THE CIT GROUP, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

               DELAWARE                                      13-2994534
--------------------------------------------------------------------------------
   (State or other jurisdiction of                          (IRS Employer
   incorporation or organization)                        Identification No.)

 1211 AVENUE OF THE AMERICAS, NEW YORK, NEW YORK                10036
--------------------------------------------------------------------------------
     (Address of principal executive offices)                 (Zip Code)

                                 (212) 536-1390
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report.)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                                 Yes |X| No |_|

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of October 31, 2000: Common Stock including Exchangeable Shares
- 261,907,555.

================================================================================

<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
                                   (UNAUDITED)

        TABLE OF CONTENTS                                                   PAGE

PART I. FINANCIAL INFORMATION                                                  1

Item 1. Condensed Financial Statements
        Consolidated Balance Sheets - September 30, 2000 and
          December 31, 1999.                                                   2
        Consolidated Income Statements for the three and nine months
          ended September 30, 2000 and 1999.                                   3
        Consolidated Statements of Changes in Stockholders' Equity for
          the nine months ended September 30, 2000 and 1999.                   4
        Consolidated Statements of Cash Flows for the nine months
          ended September 30, 2000 and 1999.                                   5
        Notes to Condensed Consolidated Financial Statements.               6-12

Item 2. Management's Discussion and Analysis of Financial
  and     Condition and Results of Operations                              13-30
Item 3. Quantitative and Qualitative Disclosures About Market Risk

PART II.  OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K                                      31

================================================================================
Statements  contained  in this  Form  10-Q  that are not  historical  facts  are
forward-looking  statements,  as that term is defined in the Private  Securities
Litigation  Reform  Act of 1995.  Because  such  statements  involve  risks  and
uncertainties,  actual  results may differ  materially  from those  expressed or
implied  by  such  forward-looking  statements.  Such  risks  and  uncertainties
include,   but  are  not  limited  to,  potential  changes  in  interest  rates,
competitive  factors,  and  general  economic  conditions  and  the  ability  to
integrate recent acquisitions.
================================================================================

                          PART I. FINANCIAL INFORMATION

      Certain  information  and footnote  disclosures  normally  included in the
consolidated financial statements prepared in accordance with generally accepted
accounting  principles have been condensed or omitted  pursuant to the rules and
regulations  of the Securities and Exchange  Commission.  It is suggested  these
condensed  consolidated  financial  statements be read in  conjunction  with the
consolidated financial statements and notes thereto included in the December 31,
1999  Annual  Report  on Form  10-K and the  March  31,  2000 and June 30,  2000
Quarterly Report on Form 10-Q for The CIT Group, Inc. ("we", "our", "us", "CIT",
or the "Company").


                                       1
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                              (Dollars in Millions)

                                                    September 30,   December 31,
                                                        2000           1999
                                                    -------------   ------------
                                                     (unaudited)
Assets
------
Financing and leasing assets
Loans and leases
   Commercial                                        $  29,943.8    $  27,119.2
   Consumer                                              4,168.1        3,887.9
                                                     -----------    -----------
      Finance receivables                               34,111.9       31,007.1
Reserve for credit losses                                 (468.2)        (446.9)
                                                     -----------    -----------
      Net finance receivables                           33,643.7       30,560.2
Operating lease equipment, net                           6,785.6        6,125.9
Finance receivables held for sale                        2,616.2        3,123.7
Cash and cash equivalents                                  819.4        1,073.4
Goodwill                                                 1,987.1        1,850.5
Other assets                                             2,475.3        2,347.4
                                                     -----------    -----------
   Total assets                                      $  48,327.3    $  45,081.1
                                                     ===========    ===========

Liabilities and Stockholders' Equity
------------------------------------
Debt
Commercial paper                                     $   9,292.3    $   8,974.0
Variable rate senior notes                               9,549.0        7,147.2
Fixed rate senior notes                                 18,758.6       19,052.3
Subordinated fixed rate notes                              200.0          200.0
                                                     -----------    -----------
   Total debt                                           37,799.9       35,373.5
Credit balances of factoring clients                     2,485.7        2,200.6
Accrued liabilities and payables                         1,447.3        1,191.8
Deferred federal income taxes                              485.5          510.8
                                                     -----------    -----------
   Total liabilities                                    42,218.4       39,276.7
Company-obligated mandatorily redeemable
   preferred securities of subsidiary
   trust holding solely debentures
   of the Company                                          250.0          250.0
Stockholders' equity
Common stock                                                 2.7            2.7
Paid-in capital                                          3,526.4        3,521.8
Retained earnings                                        2,469.3        2,097.6
Accumulated other comprehensive (loss)
   income                                                   (1.8)           2.8
Treasury stock at cost                                    (137.7)         (70.5)
                                                     -----------    -----------
   Total stockholders' equity                            5,858.9        5,554.4
                                                     -----------    -----------
   Total liabilities and stockholders'
      equity                                         $  48,327.3    $  45,081.1
                                                     ===========    ===========

See accompanying notes to condensed consolidated financial statements.


                                       2
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
                         CONSOLIDATED INCOME STATEMENTS
                 (Dollars in Millions, except per share amounts)

<TABLE>
<CAPTION>
                                                              For the Three Months           For the Nine Months
                                                              Ended September 30,            Ended September 30,
                                                            -----------------------       -------------------------
                                                               2000           1999          2000            1999
                                                            ---------       -------       --------        ---------
                                                                                 (unaudited)
<S>                                                         <C>             <C>           <C>             <C>
Finance income                                              $ 1,326.6       $ 583.9       $ 3,857.2       $ 1,679.8
Interest expense                                                642.7         304.1         1,845.5           858.2
                                                            ---------       -------       ---------       ---------
   Net finance income                                           683.9         279.8         2,011.7           821.6
Depreciation on operating lease equipment                       313.4          61.6           932.9           176.9
                                                            ---------       -------       ---------       ---------
   Net finance margin                                           370.5         218.2         1,078.8           644.7
Other revenue                                                   224.2          81.9           694.7           221.4
                                                            ---------       -------       ---------       ---------
   Operating revenue                                            594.7         300.1         1,773.5           866.1
                                                            ---------       -------       ---------       ---------

Salaries and general operating expenses                         250.2         110.2           775.9           324.0
Provision for credit losses                                      65.8          32.2           191.4            77.9
Goodwill amortization                                            22.7           4.9            63.8            13.1
Minority interest in subsidiary trust holding
   solely debentures of the Company                               4.8           4.8            14.4            14.4
                                                            ---------       -------       ---------       ---------
   Operating expenses                                           343.5         152.1         1,045.5           429.4
                                                            ---------       -------       ---------       ---------

   Income before provision for income taxes                     251.2         148.0           728.0           436.7
Provision for income taxes                                       95.0          51.1           276.5           151.6
                                                            ---------       -------       ---------       ---------
   Net income                                               $   156.2       $  96.9       $   451.5       $   285.1
                                                            =========       =======       =========       =========

Basic net income per share                                  $    0.60       $  0.60       $   1.73        $    1.77
Diluted net income per share                                $    0.60       $  0.60       $   1.72        $    1.76
</TABLE>

See accompanying notes to condensed consolidated financial statements.


                                       3
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                              (Dollars in Millions)

                                                 Nine Months Ended September 30,
                                                 -------------------------------
                                                    2000                 1999
                                                 ----------           ----------
                                                           (unaudited)

Balance, January 1                                $5,554.4             $2,701.6
                                                  --------             --------
  Net income                                         451.5                285.1
  Foreign currency translation
    adjustments                                       (5.2)                  --
  Unrealized gain on equity and
    securitization investments, net                    0.6                   --
                                                  --------             --------
Total comprehensive income                           446.9                285.1
Dividends declared                                   (79.8)               (48.6)
Treasury stock purchased                             (67.2)               (29.2)
Other                                                  4.6                  5.7
                                                  --------             --------
Balance, September 30                             $5,858.9             $2,914.6
                                                  ========             ========

See accompanying notes to condensed consolidated financial statements.


                                       4
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                              (Dollars in Millions)

<TABLE>
<CAPTION>
                                                                Nine Months Ended September 30,
                                                                -------------------------------
                                                                    2000               1999
                                                                -----------        ------------
                                                                          (unaudited)
<S>                                                              <C>                <C>
CASH FLOWS FROM OPERATIONS
Net income                                                       $   451.5          $   285.1
Adjustments to reconcile net income to net cash flows
   from operations:
 Provision for credit losses                                         191.4               77.9
 Depreciation and amortization                                     1,026.6              202.1
 Provision for deferred federal income taxes                          41.6              118.3
 Gains on equipment, receivable and investment sales                (275.6)             (74.0)
 Increase in accrued liabilities and payables                         23.5               37.8
 Increase in other assets                                           (212.5)             (67.0)
 Other                                                                23.8               28.6
                                                                 ---------          ---------
  Net cash flows provided by operations                            1,270.3              608.8
                                                                 ---------          ---------

CASH FLOWS FROM INVESTING ACTIVITIES
Loans extended                                                   (36,452.3)         (25,908.5)
Collections on loans                                              31,255.1           24,404.6
Proceeds from asset and receivable sales                           4,984.2            2,078.1
Purchases of assets to be leased                                  (1,652.7)          (1,221.6)
Purchases of finance receivable portfolios                        (1,342.3)            (516.6)
Net increase in short-term factoring receivables                    (440.0)            (552.6)
Other                                                                (61.4)             (13.8)
                                                                 ---------          ---------
  Net cash flows used for investing activities                    (3,709.4)          (1,730.4)
                                                                 ---------          ---------

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issuance of variable and fixed rate notes        9,243.7            6,199.5
Repayments of variable and fixed rate notes                       (7,135.6)          (4,136.9)
Net increase (decrease) in commercial paper                          318.3             (671.5)
Net repayments of non-recourse leveraged lease debt                  (90.1)            (122.3)
Cash dividends paid                                                  (79.8)             (48.6)
Purchase of treasury stock                                           (67.2)             (29.2)
                                                                 ---------          ---------
  Net cash flows provided by financing activities                  2,189.3            1,191.0
                                                                 ---------          ---------
Effect of exchange rate on cash                                       (4.2)                --
                                                                 ---------          ---------
Net (decrease) increase in cash and cash equivalents                (254.0)              69.4
Cash and cash equivalents, beginning of period                     1,073.4               73.6
                                                                 ---------          ---------
Cash and cash equivalents, end of period                         $   819.4          $   143.0
                                                                 =========          =========

Supplemental disclosures
Interest paid                                                    $ 1,795.8          $   790.9
Federal, state and local and foreign income taxes paid           $    27.6          $    47.1
</TABLE>

See accompanying notes to condensed consolidated financial statements.


                                       5
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - Basis of Presentation

We  believe  all  adjustments  (all of  which  are  normal  recurring  accruals)
necessary for a fair  statement of financial  position and results of operations
for  these  periods  have  been  made.  Results  for  interim  periods  are  not
necessarily  indicative  of results  for a full year and are subject to year-end
audit adjustments.

Note 2 - Earnings Per Share

The  reconciliation of the numerator and denominator of basic earnings per share
("EPS") and diluted EPS is presented below.

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                      For the Three Months Ended September 30,
                              -----------------------------------------------------------------------------------------
                                                 2000                                          1999
                              --------------------------------------------   ------------------------------------------
                                 Income          Shares         Per Share      Income          Shares       Per Share
                               (Numerator)    (Denominator)      Amount      (Numerator)   (Denominator)     Amount
                               -----------    -------------      ------      -----------   -------------     ------
                                                      (In Millions, except per share amounts)
<S>                               <C>             <C>            <C>            <C>             <C>          <C>
Basic EPS:
Income available to
  common shareholders             $ 156.2         259.9          $ 0.60         $ 96.9          160.5        $ 0.60
                                                                 ======                                      ======
Effect of Dilutive
  Securities:
Restricted shares                      --           2.1                             --            1.0
Stock options                          --            --                             --             --
                                  -------         -----                         ------          -----
Diluted EPS                       $ 156.2         262.0          $ 0.60         $ 96.9          161.5        $ 0.60
                                  =======         =====          ======         ======          =====        ======
</TABLE>

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                      For the Nine Months Ended September 30,
                              -----------------------------------------------------------------------------------------
                                                 2000                                          1999
                              --------------------------------------------   ------------------------------------------
                                 Income          Shares         Per Share      Income          Shares       Per Share
                               (Numerator)    (Denominator)      Amount      (Numerator)   (Denominator)     Amount
                               -----------    -------------      ------      -----------   -------------     ------
                                                      (In Millions, except per share amounts)
<S>                               <C>             <C>            <C>           <C>              <C>          <C>
Basic EPS:
Income available to
  common shareholders             $ 451.5         261.5          $ 1.73        $ 285.1          160.9        $ 1.77
                                                                 ======                                      ======
Effect of Dilutive
  Securities:
Restricted shares                      --           1.3                             --            0.9
Stock options                          --            --                             --            0.2
                                  -------         -----                         ------          -----
Diluted EPS                       $ 451.5         262.8          $ 1.72        $ 285.1          162.0        $ 1.76
                                  =======         =====          ======         ======          =====        ======
</TABLE>

--------------------------------------------------------------------------------


                                       6
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 - Stockholders' Equity

The following table summarizes the outstanding  common stock, par value $.01 per
share with 1,210,000,000 shares authorized, and exchangeable shares at September
30, 2000, and December 31, 1999.

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                            Common Stock
                                        --------------------------------------------------
                                                               Less                               Exchangeable
                                           Issued            Treasury          Outstanding           Shares
                                        -----------         ----------         -----------        ------------
<S>                                     <C>                 <C>                <C>                 <C>
Balance at September 30, 2000           256,817,612         (6,689,636)        250,127,976         11,782,462
                                        ===========         ==========         ===========         ==========

Balance at December 31, 1999            242,285,952         (2,745,685)        239,540,267         24,892,310
                                        ===========         ==========         ===========         ==========
</TABLE>

--------------------------------------------------------------------------------

Exchangeable  shares of CIT Exchangeco  Inc., par value of $.01 per share,  were
issued in connection with the acquisition of Newcourt. The holders of Exchangeco
shares have dividend,  voting and other rights equivalent to those of CIT common
stockholders.  These  shares may be  exchanged  at any time at the option of the
holder on a  one-for-one  basis for CIT common  stock,  and in any event will be
exchanged no later than November 2004.


                                       7
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 4 - Business Segment Information

The  following   table  presents   reportable   segment   information   and  the
reconciliation  to the  consolidated  totals as of and for the nine months ended
September  30,  2000,  and  1999.   Certain  prior  period  balances  have  been
reclassified to conform with the current period presentation.

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                  Equipment     Vendor
                                  Financing   Technology  Commercial   Structured               Total                Consolidated
                                 and Leasing   Finance      Finance      Finance    Consumer   Segments    Corporate     Total
                                 -----------   -------      -------     --------    --------   --------    ---------  -----------
                                                                      (Dollars in Millions)
<S>                              <C>          <C>          <C>         <C>         <C>         <C>         <C>          <C>
September 30, 2000
Operating revenue                $   705.0    $   404.0    $   368.8   $   153.2   $   185.5   $ 1,816.5   $   (43.0)   $ 1,773.5
Net income                           200.4        110.6        117.8        84.4        51.2       564.4      (112.9)       451.5
Total managed assets              26,043.4     10,805.8      8,249.5     2,227.8     7,302.6    54,629.1          --     54,629.1

September 30, 1999
Operating revenue                $   378.4    $      --    $   301.9   $      --   $   184.6   $   864.9   $     1.2    $   866.1
Net income                           177.1           --        101.1          --        47.1       325.3       (40.2)       285.1
Total managed assets              14,326.0           --      6,615.3          --     7,556.6    28,497.9       115.8     28,613.7
</TABLE>

--------------------------------------------------------------------------------

In the third quarter of 2000, we implemented  certain  strategic  organizational
refinements,  which are reflected on a year to date basis in the table above, to
better  align  marketing  and risk  management  efforts  and to further  improve
operating  efficiencies  and returns.  Certain North American  business lines of
Vendor Technology  Finance were transferred to the Equipment  Financing business
unit.  The  communications  and media product lines  previously  with  Equipment
Financing have been transferred to Structured Finance and Equity Investments now
operates as part of Structured  Finance.  Included in the Corporate  results are
goodwill amortization as well as normal overhead expenses.  Prior year Corporate
results also included Equity Investments.

Note 5 - Newcourt Acquisition

On  November  15,  1999,  CIT  acquired  Newcourt,  a publicly  traded  non-bank
financial services  enterprise,  which originated,  invested in and securitized,
syndicated and sold  asset-based  loans and leases.  The acquisition of Newcourt
has been accounted for using the purchase  method.  The  difference  between the
purchase  price and the fair  value of net  assets  acquired  was  allocated  to
goodwill in the Consolidated Balance Sheets.


                                       8
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Goodwill  related to the Newcourt  acquisition,  which was  $1,534.5  million at
September 30, 2000, is being amortized on a straight-line basis over twenty-five
years from the acquisition date.

The  following  table  summarizes  the activity in the  restructuring  liability
related to the Newcourt acquisition.

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                             Severance
                                             and Other    Leasehold   Transaction
                                            Termination  Termination   and Other
                                               Costs        Costs        Costs       Total
                                            -----------  -----------   ---------    -------
                                                          (Dollars in Millions)
<S>                                           <C>          <C>          <C>          <C>
Balance at November 15, 1999                  $102.1       $ 24.5       $ 72.6       $199.2
   Cash payments                               (48.1)          --        (38.0)       (86.1)
   Transaction fees settled in CIT stock          --           --        (14.3)       (14.3)
   Non-cash reductions                            --           --         (2.5)        (2.5)
                                              ------       ------       ------       ------
Balance at December 31, 1999                    54.0         24.5         17.8         96.3
   Cash payments                               (21.3)          --         (5.3)       (26.6)
                                              ------       ------       ------       ------
Balance at March 31, 2000                       32.7         24.5         12.5         69.7
   Cash payments                               (23.7)        (6.5)        (2.4)       (32.6)
   Additions                                     6.7           --           --          6.7
   Non-cash reductions                            --         (2.4)        (7.4)        (9.8)
                                              ------       ------       ------       ------
Balance at June 30, 2000                        15.7         15.6          2.7         34.0
   Cash payments                               (12.8)        (1.4)        (0.4)       (14.6)
                                              ------       ------       ------       ------
Balance at September 30, 2000                 $  2.9       $ 14.2       $  2.3       $ 19.4
                                              ======       ======       ======       ======
</TABLE>

--------------------------------------------------------------------------------

Note 6 - Selected Pro Forma Information

The unaudited condensed consolidated statements of income for the three and nine
months  ended   September  30,  2000  and  the  unaudited  pro  forma  condensed
consolidated statements of income for the


                                       9
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

three and nine  months  ended  September  30,  1999  follow.  The 1999 pro forma
statements have been prepared assuming that the Newcourt acquisition occurred at
the beginning of the period.

--------------------------------------------------------------------------------

                                For the Three Months      For the Nine Months
                                Ended September 30,       Ended September 30,
                                --------------------    -----------------------
                                  2000        1999        2000          1999*
                                --------    --------    ---------     ---------
                                 (Dollars in Millions, except per share amounts)

Operating revenue               $  594.7    $  595.0    $ 1,773.5     $ 1,774.0
Net income                         156.2       135.6        451.5         405.3
Basic earnings per share            0.60        0.51         1.73          1.53
Diluted earnings per share          0.60        0.51         1.72          1.52

--------------------------------------------------------------------------------
*  1999 pro forma results  include the  following:  a disposal of two automotive
   leasing  units  resulting in a $34.3  million  pre-tax  gain,  $15.5  million
   after-tax  and  $0.06  pro  forma  EPS  and a  non-recurring  gain  from  the
   extinguishment of certain derivative instruments by Newcourt of $56.6 million
   pretax, $31.1 million after tax and $0.12 pro forma EPS.

The pro forma results have been prepared for  comparative  purposes only and are
based on the historical  operating results of Newcourt prior to the acquisition.
The pro forma  results  include  certain  adjustments,  primarily  to  recognize
accretion and amortization  based on the allocated  purchase price of assets and
liabilities.  However,  the 1999  results do not include cost  savings,  reduced
securitization activity and other initiatives  contemplated by CIT in connection
with the  acquisitions.  Accordingly,  management does not believe that the 1999
pro forma results are  indicative of the actual results that would have occurred
had the acquisition closed at the beginning of the year.

Note 7 - Recent Accounting Pronouncements

During 1999, the Financial  Accounting Standards Board ("FASB") issued Statement
of Financial  Accounting  Standards ("SFAS") No. 137, "Accounting for Derivative
Instruments  and  Hedging  Activities--Deferral  of the  Effective  Date of FASB
Statement No. 133, an amendment of FASB Statement No. 133". SFAS 137 delayed the
implementation  of SFAS No. 133, which is now effective for all fiscal  quarters
of all fiscal years  beginning  after June 15, 2000.  During June 2000, the FASB
issued SFAS No. 138, "Accounting for Certain Derivative  Instruments and Certain
Hedging Activities, an amendment of FASB Statement No. 133."


                                       10
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

We have completed the initial  analysis of the impact of SFAS 138 and are in the
process of implementing  systems  capabilities to account for derivatives  under
this new standard. We do not expect the implementation in 2001 of SFAS 138 to be
material  to either  the  statement  of  financial  position  or the  results of
operations.

During  September 2000, the FASB issued SFAS No. 140,  "Accounting for Transfers
and  Servicing  of  Financial  Assets  and   Extinguishments  of  Liabilities--a
replacement of FASB Statement No. 125".  SFAS No. 140 is effective for transfers
and servicing of financial assets and  extinguishments of liabilities  occurring
after March 31, 2001, and is effective for recognition and  reclassification  of
collateral and for  disclosures for fiscal years ending after December 15, 2000.
This  Statement  revised the standards for accounting  for  securitizations  and
other  transfers  of financial  assets and  collateral  and requires  additional
disclosures.  It carries  forward  most of the  provisions  of SFAS 125  without
change.  We do not expect the adoption of this standard to affect the accounting
for, or the structure of, our securitization transactions.


                                       11
<PAGE>

                      THE CIT GROUP, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Summarized Financial Information of Subsidiaries

The following table shows summarized  consolidated financial information for CIT
Holdings LLC and its wholly owned subsidiary,  AT&T Capital.  CIT has guaranteed
on a full and  unconditional  basis the existing  registered debt securities and
certain  other  indebtedness  of  these  subsidiaries.  Therefore,  CIT  has not
presented   related   financial   statements  or  other  information  for  these
subsidiaries  on a  stand-alone  basis.  The following  summarized  consolidated
financial  information  reflects  results  as of and for the nine  months  ended
September 30, 2000 and also the transfer of various  subsidiaries  amongst other
CIT entities.

--------------------------------------------------------------------------------

                                                       Nine Months Ended
                                                       September 30, 2000
                                               ---------------------------------
                                               CIT Holdings LLC     AT&T Capital
                                               ----------------     ------------
                                                     (Dollars in Millions)

Operating revenue                                 $  499.6           $  285.6
Operating expenses                                   270.2              184.6
Operating income before taxes                        229.4              101.0
Net income                                           141.4               58.8

                                                      At September 30, 2000
                                               ---------------------------------
                                               CIT Holdings LLC     AT&T Capital
                                               ----------------     ------------
                                                     (Dollars in Millions)
Assets
Cash and cash equivalents                         $  105.2           $   86.0
Financing and leasing portfolio assets             6,577.0            4,788.5
Receivables from affiliates and other assets         947.8              557.9
                                                  --------           --------
Total assets                                      $7,630.0           $5,432.4
                                                  ========           ========
Liabilities and Stockholders' Equity
Liabilities:
Debt                                              $4,304.4           $3,903.3
Other                                                504.9              263.1
                                                  --------           --------
Total liabilities                                  4,809.3            4,166.4
Total stockholders' equity                         2,820.7            1,266.0
                                                  --------           --------
Total liabilities and stockholders' equity        $7,630.0           $5,432.4
                                                  ========           ========
--------------------------------------------------------------------------------


                                       12
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
and         CONDITION AND RESULTS OF OPERATIONS
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
            MARKET RISK

OVERVIEW

Quarterly and nine-month  net income,  EPS and selected  ratio  comparisons  are
presented in the following table.

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                    Three Months Ended                         Nine Months Ended
                                                         ----------------------------------------          ------------------------
                                                               September 30,             June 30,                September 30,
                                                         ------------------------                          ------------------------
                                                          2000             1999            2000             2000             1999
                                                         -------          -------         -------          -------          -------
                                                                       (Dollars in Millions, except per share amounts)
<S>                                                      <C>              <C>             <C>              <C>              <C>
Net income                                               $156.2           $96.9           $151.4           $451.5           $285.1
Net income per diluted share                             $ 0.60           $0.60           $ 0.58           $ 1.72           $ 1.76
Net income per diluted share excluding
  goodwill amortization                                  $ 0.67           $0.62           $ 0.66           $ 1.93           $ 1.81
Return on average stockholders' equity                     10.8%           13.5%            10.7%            10.6%            13.6%
Return on average tangible
  stockholders' equity                                     16.5%           15.3%            15.9%            15.9%            15.1%
Return on average earning assets (AEA)                     1.52%           1.63%            1.49%            1.50%            1.64%
</TABLE>

--------------------------------------------------------------------------------

The earnings per share above reflect higher 2000 earnings offset by the dilutive
effect of stock issued in connection  with the November 15, 1999  acquisition of
Newcourt.  Compared to the prior year,  the third  quarter and  nine-month  2000
earnings  reflect  growth from our 1999  acquisition  activities,  solid fee and
other income generation,  as well as considerable expense savings related to our
operational  integrations.  The declines from 1999 reflect  narrower net finance
margins  and  higher  expense  levels  associated  with the  1999  acquisitions.
Earnings,  as well as return on AEA and return on equity,  have improved in each
successive quarter of 2000.

New business  origination  volume,  excluding  factoring  volume,  for the third
quarter of 2000 was $6.1 billion, unchanged from the second quarter of 2000, and
an increase  from $2.4 billion in the third quarter of 1999 due primarily to the
Newcourt acquisition.

Total managed  assets  increased to $54.6 billion at September 30, 2000, up 2.4%
from $53.4  billion at June 30, 2000 and up 6.2% from $51.4 billion at year-end.
Growth in equipment  financing  and seasonal  growth in factoring  were somewhat
offset by continued sales of non-strategic  assets totaling over $300


                                       13
<PAGE>

million in the third  quarter,  and  approximately  $900  million  year to date.
Commercial  managed  assets were $47.3  billion at September  30, 2000,  up from
$46.1 billion at June 30, 2000 and $44.2 billion at December 31, 1999.  Consumer
managed  assets were $7.3 billion at September 30, 2000 compared to $7.2 billion
at June 30, 2000 and unchanged from December 31, 1999.  Total  portfolio  assets
increased to $43.8  billion  from $42.6  billion at June 30, 2000 and from $40.4
billion at year-end 1999.

NET FINANCE MARGIN

A comparison of net finance margin is set forth below.

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                           Three Months Ended
                                               --------------------------------------------
                                                      September 30,               June 30,
                                               ---------------------------
                                                  2000             1999             2000
                                               ----------       ----------       ----------
                                                           (Dollars in Millions)
<S>                                            <C>              <C>              <C>
Finance income                                 $  1,326.6       $    583.9       $  1,301.8
Interest expense                                    642.7            304.1            630.9
                                               ----------       ----------       ----------
  Net finance income                                683.9            279.8            670.9
Depreciation on operating lease equipment           313.4             61.6            311.7
                                               ----------       ----------       ----------
  Net finance margin                           $    370.5       $    218.2       $    359.2
                                               ==========       ==========       ==========

AEA                                            $ 41,060.9       $ 23,818.5       $ 40,690.9

Net finance margin as a % of AEA                     3.61%            3.66%            3.53%
</TABLE>

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                           Nine Months Ended
                                      ---------------------------
                                              September 30,                     Increase
                                      ---------------------------       -------------------------
                                         2000              1999           Amount        Percent
                                      ----------       ----------       ----------     ----------
                                                         (Dollars in Millions)
<S>                                   <C>              <C>              <C>                 <C>
Finance income                        $  3,857.2       $  1,679.8       $  2,177.4          129.6%
Interest expense                         1,845.5            858.2            987.3          115.0
                                      ----------       ----------       ----------     ----------
  Net finance income                     2,011.7            821.6          1,190.1          144.9
Depreciation on operating lease
    equipment                              932.9            176.9            756.0          427.4
                                      ----------       ----------       ----------     ----------
  Net finance margin                  $  1,078.8       $    644.7       $    434.1           67.3%
                                      ==========       ==========       ==========     ==========

AEA                                   $ 40,267.4       $ 23,213.9       $ 17,053.5           73.5%

Net finance margin as a % of AEA            3.57%            3.70%
</TABLE>

--------------------------------------------------------------------------------


                                       14
<PAGE>

Net finance margin  increased 69.8% to $370.5 million for the three months ended
September 30, 2000 from the same period in 1999,  and was up $11.3  million,  or
3.1%,  over the second  quarter of 2000.  The year over year increase  primarily
reflects growth in financing assets due to our 1999  acquisitions and internally
generated  portfolio growth.  Net finance margin for the nine-month period ended
September  30, 2000  increased  $434.1  million or 67.3% from the same period in
1999. As a percentage of AEA, net finance margin declined to 3.61% for the three
months ended September 30, 2000 from 3.66% in the third quarter of 1999, but was
up from  3.53%  for the  second  quarter  of  2000.  For the nine  months  ended
September 30, 2000,  net finance margin as a percentage of AEA declined to 3.57%
from 3.70% for the same period in 1999. The year over year  comparisons  reflect
several  factors  including  rising market  interest  rates,  wider debt pricing
spreads, competitive product pricing, and the growing operating lease portfolio.
Our  operating  leases,  which  generally  have lower net margins  than  finance
receivables at inception,  also generate  equipment gains,  renewal fees and tax
depreciation  benefits. The improvement in net finance margin as a percentage of
AEA from the second  quarter of 2000  reflects  the more  stable  interest  rate
environment and the impact of pricing initiatives in the acquired businesses.

Finance income for the three months ended  September 30, 2000  increased  $742.7
million,  or 127.2%,  from the third  quarter  1999 and $24.8  million  from the
second quarter of 2000. Finance income for the nine-month period ended September
30, 2000 increased $2,177.4 million, or 129.6%, from the same period in 1999. As
a percentage of AEA,  finance  income  (excluding  interest  income  relating to
short-term  interest-bearing  deposits)  was 12.70% for the third  quarter ended
September  30,  2000,  compared to 9.60% for the same quarter of 1999 and 12.53%
for the second quarter of 2000. For the nine months ended September 30, 2000 and
1999,   finance  income  (excluding   interest  income  relating  to  short-term
interest-bearing  deposits)  as a  percentage  of  AEA  was  12.56%  and  9.50%,
respectively. The year over year increase in yield was due to product mix change
primarily as a result of the fourth quarter 1999 Newcourt acquisition.

Interest  expense for the three months ended September 30, 2000 increased $338.6
million,  or 111.3%, from the third quarter 1999 and $11.8 million from June 30,
2000, and for the nine-month  period ended September 30, 2000,  increased $987.3
million,  or  115.0%,  from the same  period in 1999.  As a  percentage  of AEA,
interest   expense   (excluding   interest   expense   relating  to   short-term
interest-bearing  deposits  and  dividends  related to the  Company's  preferred
capital  securities) for the third quarter of 2000 increased to 6.04% from 4.90%
for the  September  30, 1999 period and 5.93% for the June 30, 2000 period,  and
increased to 5.90% from 4.78% for the  nine-month  periods  ended  September 30,
2000 and 1999, respectively.  The increases from the second to third quarters of
2000 and from the  comparable


                                       15
<PAGE>

periods of 1999 reflect the rising interest rate  environment in the latter half
of 1999, which continued into 2000.

The operating lease  equipment  portfolio was $6.8 billion at September 30, 2000
versus $6.1 billion at December 31, 1999 and $3.7 billion at September 30, 1999.
Operating lease margin (rental income less depreciation  expense as a percentage
of average  operating  leases) for the third  quarter of 2000 was 7.2%,  up from
6.9% in the second quarter of 2000 and relatively  unchanged from the prior year
third  quarter,  while the  nine-month  periods  were 7.5% and 6.9% for 2000 and
1999,  respectively.  Depreciation  on operating lease equipment for the quarter
ended September 30, 2000 was $313.4 million,  up from $61.6 million for the same
period in 1999 and $311.7  million for the second  quarter of 2000,  and for the
nine months ended September 30, 2000,  depreciation was $932.9 million,  up from
$176.9 million in the same period in 1999. As a percentage of average  operating
leases,  depreciation  expense,  on an annualized  basis,  was 20.8% and 7.2% at
September  30, 2000 and  September  30, 1999,  respectively.  The year over year
increases  in  operating  lease  margin and  depreciation  reflects the acquired
Newcourt  portfolios,  which include shorter-term assets with higher margins and
more rapid depreciable lives.

We seek to mitigate interest rate risk by matching the repricing characteristics
of our assets  with our  liabilities,  which is done in part  through the use of
derivative financial instruments,  principally interest rate swaps. The notional
amounts of interest  rate swaps were  $14,145.2  million at September  30, 2000,
reflecting  our current  strategy to hedge  available  for sale and  securitized
receivables,  interim  hedging  in advance of large,  less  frequent  fixed rate
financing and to reduce funding costs by issuing floating rate debt and swapping
it into fixed rate. See "Liquidity Risk  Management" for further  discussion.  A
comparative analysis of the weighted average principal  outstanding and interest
rates paid on our debt  before and after the  effect of  interest  rate swaps is
shown in the following table.


                                       16
<PAGE>

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                    Three Months Ended September 30, 2000
                                                ----------------------------------------------
                                                   Before Swaps               After Swaps
                                                -------------------        -------------------
                                                           (Dollars in Millions)
<S>                                             <C>           <C>          <C>           <C>
Commercial paper and variable rate
   senior notes                                 $20,297.3     6.72%        $14,633.3     6.92%
Fixed rate senior and subordinated notes         17,975.3     6.73%         23,639.3     6.71%
                                                ---------                  ---------
Composite interest rate paid                    $38,272.6     6.72%        $38,272.6     6.79%
                                                =========                  =========

<CAPTION>
                                                    Three Months Ended September 30, 1999
                                                ----------------------------------------------
                                                   Before Swaps               After Swaps
                                                -------------------        -------------------
                                                           (Dollars in Millions)
<S>                                             <C>           <C>          <C>           <C>
Commercial paper and variable rate
   senior notes                                 $11,413.2     5.33%        $ 8,747.6     5.33%
Fixed rate senior and subordinated notes          8,930.5     6.20%         11,596.1     6.25%
                                                ---------                  ---------
Composite interest rate paid                    $20,343.7     5.71%        $20,343.7     5.86%
                                                =========                  =========

----------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------

<CAPTION>
                                                      Nine Months Ended September 30, 2000
                                                ----------------------------------------------
                                                   Before Swaps               After Swaps
                                                -------------------        -------------------
                                                           (Dollars in Millions)
<S>                                             <C>           <C>          <C>           <C>
Commercial paper and variable rate
   senior notes                                 $19,626.3     6.45%        $14,943.0     6.66%
Fixed rate senior and subordinated notes         17,891.6     6.70%         22,574.9     6.63%
                                                ---------                  ---------
Composite interest rate paid                    $37,517.9     6.57%        $37,517.9     6.64%
                                                =========                  =========

<CAPTION>
                                                     Nine Months Ended September 30, 1999
                                                ----------------------------------------------
                                                   Before Swaps               After Swaps
                                                -------------------        -------------------
                                                           (Dollars in Millions)
<S>                                             <C>           <C>          <C>           <C>
Commercial paper and variable rate
   senior notes                                 $10,984.8     5.09%        $ 8,521.4     5.08%
Fixed rate senior and subordinated notes          8,758.0     6.19%         11,221.4     6.26%
                                                ---------                  ---------
Composite interest rate paid                    $19,742.8     5.58%        $19,742.8     5.75%
                                                =========                  =========
</TABLE>

--------------------------------------------------------------------------------

The weighted average composite  interest rate after swaps in each of the periods
presented  increased  from the composite  interest  rate before swaps  primarily
because a larger  proportion  of our debt,  after giving effect to interest rate
swaps,  was subject to a fixed  interest  rate.  However,  the weighted  average
interest rates before swaps do not necessarily reflect the interest expense that
would have been incurred had we chosen to manage  interest rate risk without the
use of such swaps.


                                       17
<PAGE>

OTHER (NON-SPREAD) REVENUE

Other  revenue for the three months  ended  September  30, 2000  totaled  $224.2
million,  compared  to $81.9  million  for the third  quarter of 1999 and $232.3
million for the June 30, 2000 quarter.  For the nine months ended  September 30,
2000 and  1999,  other  revenue  totaled  $694.7  million  and  $221.4  million,
respectively.  These year over year  increases  reflect the  broadened  and more
diversified revenue sources from the acquired Newcourt business units.

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                Three Months Ended             Nine Months Ended
                                          -------------------------------     ------------------
                                             September 30,       June 30,       September 30,
                                          ------------------                  ------------------
                                           2000        1999        2000        2000        1999
                                          ------      ------      ------      ------      ------
                                                           (Dollars in Millions)
<S>                                       <C>         <C>         <C>         <C>         <C>
Fees and other income                     $126.8      $ 36.2      $121.1      $369.3      $ 87.5
Factoring commissions                       39.2        31.1        38.2       115.9        84.1
Gains on securitizations                    26.9          --        23.0        68.9         5.3
Gains on sales of leasing equipment         19.6        14.6        39.4        80.8        44.5
Gains on venture capital investments        11.7          --        10.6        59.8          --
                                          ------      ------      ------      ------      ------
                                          $224.2      $ 81.9      $232.3      $694.7      $221.4
                                          ======      ======      ======      ======      ======
</TABLE>

--------------------------------------------------------------------------------

The growth in fees and other income  reflects fees  associated with the acquired
Newcourt  businesses,  including strong joint venture revenues,  syndication and
structuring  fees,  as well as gains from consumer  whole loan sales.  Factoring
commissions,  for both the three  and nine  months  ended  September  30,  2000,
increased reflecting higher internally generated origination volume and the 1999
acquisitions.  Securitization gains were $26.9 million or 10.7% of pretax income
versus $23.0  million or 9.4% of pretax  income for the second  quarter of 2000,
and no  securitization  gain  activity  for the same  period  in 1999.  Gains on
equipment  sales,  while  above the prior  year  quarter,  were below the second
quarter, which included particularly strong gains in the Equipment Financing and
Leasing segment.  Gains of $11.7 million for the third quarter and $59.8 million
for the nine  months  ended  September  30,  2000 were  realized  on a number of
venture capital investments, including a sizeable first quarter transaction.

SALARIES AND GENERAL OPERATING EXPENSES

Salaries and general  operating  expenses  totaled  $250.2 million for the third
quarter of 2000, up from $110.2 million in the comparable 1999 period,  but down
$7.3 million from the second  quarter of 2000 due to  continued  realization  of
integration  benefits.  For the  nine-month  period  ended  September  30, 2000,
salaries and general operating  expenses increased to $775.9 million from $324.0
for the same  period in 1999.  The year over year  increases  reflect  increased
personnel and facilities due to the 1999


                                       18
<PAGE>

acquisitions  and  normal  expense  increases.  Although  up from the prior year
quarter and nine months,  third quarter 2000 expense levels  reflect  annualized
run rate savings in excess of our  original  $150  million  integration  related
expense  reduction  target.  Expense  savings  to date  are  primarily  from the
elimination of duplicate  corporate  overhead and  consolidation  of non-revenue
department  activities,  as well as savings  from the  consolidation  of certain
servicing  centers  and real  estate  cost  reductions.  Headcount  was 7,300 at
quarter end, down 955 from December 31, 1999 and 100 from June 30, 2000.

Management  monitors  productivity  via the  efficiency  ratio  and the ratio of
salaries and general operating expenses to average managed assets ("AMA"). These
ratios are set forth in the following table.

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                               Three Months Ended          Nine Months Ended
                                        -------------------------------    -----------------
                                          September 30,        June 30,      September 30,
                                        ----------------                   -----------------
                                        2000        1999        2000        2000        1999
                                        ----        ----        ----        ----        ----
<S>                                     <C>         <C>         <C>         <C>         <C>
Efficiency ratio                        42.4%       37.3%       43.9%       44.1%       38.0%
Salaries and general operating
  expenses as a percentage of AMA       1.96%       1.65%       2.03%       2.03%       1.66%
</TABLE>

--------------------------------------------------------------------------------

The  decrease in expenses as noted above  reduced the two ratios from the second
quarter 2000 levels. The higher 2000 ratios,  when compared to 1999, reflect the
acquired Vendor Technology Finance operations,  which carry significantly higher
expense ratios. Management targets an efficiency ratio below 40.0%.

GOODWILL AMORTIZATION

Goodwill amortization was $22.7 million and $63.8 million for the three and nine
months ended  September 30, 2000,  versus $4.9 million and $13.1 million for the
same  periods  in  1999.  These  increases   reflect  the  impact  of  the  1999
acquisitions of Newcourt,  and the factoring  operations of Heller and Congress,
each of which were accounted for under the purchase method.

Incremental exit costs  associated with  restructuring  activities,  designed to
further improve efficiency and  profitability,  which were contemplated in CIT's
integration  plan,  would be  reflected  as goodwill  adjustments  in the fourth
quarter of 2000 to the extent applicable. We do not believe such adjustments, if
any, would be material.


                                       19
<PAGE>

RESERVE AND PROVISION FOR CREDIT LOSSES/CREDIT QUALITY

The reserve for credit losses is periodically  reviewed for adequacy considering
economic conditions,  collateral values and credit quality indicators, including
charge-off  experience,  and levels of past due loans and non-performing assets.
The  reserve  increased  to $468.2  million  (1.37% of finance  receivables)  at
September 30, 2000 from $460.3  million (1.39% of finance  receivables)  at June
30, 2000, $446.9 million (1.44% of finance receivables) at December 31, 1999 and
$283.8  million  (1.33% of finance  receivables)  at  September  30, 1999 due to
portfolio  growth  for the first  nine  months  and the 1999  acquisitions.  The
decline in the  reserve  ratio from the second  quarter is due to mix changes in
the portfolio, as well as seasonal factoring receivable growth. The relationship
of the reserve for credit losses to non-accrual finance receivables was 72.7% at
September  30, 2000 compared to 73.6% at June 30, 2000 and 87.6% at December 31,
1999.

The provision for credit losses for the third quarter of 2000 was $65.8 million,
up from $32.2  million in the third  quarter of 1999 and $64.0  million  for the
second  quarter of 2000,  reflecting  higher  2000 net credit  losses  over 1999
levels and provisions for portfolio growth.

Net  credit  losses  were  stable at $61.9  million  (0.74% of  average  finance
receivables)  for the quarter ended September 30, 2000 compared to $60.7 million
(0.73% of  average  finance  receivables)  for the second  quarter of 2000.  Net
credit  losses  for the third  quarter  last year were $25.3  million  (0.48% of
average finance  receivables).  For the nine months ended September 30, 2000 and
1999, net credit losses were $175.5 million  (0.71%) and $67.5 million  (0.44%),
respectively.  The  increase  in net  credit  losses  from  1999  to  2000  as a
percentage of average finance  receivables  reflects  product mix changes due to
the 1999 acquisitions.


                                       20
<PAGE>

The  following  table sets forth net credit  losses as a  percentage  of average
finance receivables (annualized), excluding finance receivables held for sale.

--------------------------------------------------------------------------------

                                          Three Months Ended September 30,
                                      -----------------------------------------
                                              2000                  1999
                                      -------------------    ------------------
                                                (Dollars in Millions)
Equipment Financing and Leasing*      $ 28.5        0.78%    $  6.3       0.23%
Vendor Technology Finance*              11.5        0.78         --         --
Commercial Finance                       9.2        0.47        6.9       0.44
Structured Finance                       0.1        0.03         --         --
                                      ------      ------     ------     ------
  Total Commercial Segments             49.3        0.67       13.2       0.31
Consumer                                12.6        1.21       12.1       1.17
                                      ------      ------     ------     ------
  Total                               $ 61.9        0.74%    $ 25.3       0.48%
                                      ======      ======     ======     ======

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

                                            Nine Months Ended September 30,
                                      -----------------------------------------
                                              2000                  1999
                                      -------------------    ------------------
                                                (Dollars in Millions)
Equipment Financing and Leasing*      $ 78.5        0.72%    $ 13.1       0.16%
Vendor Technology Finance*              20.7        0.48         --         --
Commercial Finance                      34.8        0.62       18.1       0.42
Structured Finance                       0.4        0.05         --         --
                                      ------      ------     ------     ------
  Total Commercial Segments            134.4        0.62       31.2       0.25
Consumer                                41.1        1.34       36.3       1.16
                                      ------      ------     ------     ------
  Total                               $175.5        0.71%    $ 67.5       0.44%
                                      ======      ======     ======     ======

--------------------------------------------------------------------------------
*   The  September   2000  balances  and   percentages   reflect  the  transfer,
    retroactively back to January 1, 2000, of certain business lines from Vendor
    Technology  Finance to Equipment  Financing and Leasing  Segment made during
    the third quarter.

Commercial net credit losses were relatively  stable during the third quarter in
relation to the second quarter 2000,  0.67% versus 0.64%,  whereas  consumer net
credit  losses  declined to 1.21% from  1.34%.  Year over year,  commercial  net
credit  losses for the quarter were up from 0.31% in 1999 to 0.67% due mainly to
higher  charge-offs  in Equipment  Financing and Leasing (due primarily to asset
transfers  from Vendor  Technology  Finance) and  Commercial  Finance and to the
addition of Vendor  Technology  Finance.  Consumer net credit  losses were 1.21%
compared  to 1.17% for the  three  months  ended  September  30,  2000 and 1999,
respectively,  primarily  due  to  higher  losses  in the  manufactured  housing
portfolio. Equipment Financing and Leasing net credit losses increased primarily
due to the transfer  of


                                       21
<PAGE>

assets from the acquired Newcourt portfolios. The increase in Commercial Finance
net  credit  losses,  for the  nine  months  over  1999,  was  primarily  due to
write-offs associated with a food wholesaler.

PAST DUE AND NON-PERFORMING ASSETS

The following table sets forth certain information concerning past due and total
non-performing   assets  and  related  percentages  of  receivables,   excluding
receivables held for sale, at September 30, 2000, June 30, 2000 and December 31,
1999.  Non-performing  assets  reflect both finance  receivables  on non-accrual
status and assets received in satisfaction of loans.

--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                        At September 30,             At June 30,           At December 31,
                                             2000                       2000                   1999
                                       -----------------           --------------         ----------------
                                                              (Dollars in Millions)
<S>                                    <C>          <C>            <C>       <C>          <C>         <C>
Finance receivables, past due 60
     days or more
  Equipment Financing and Leasing      $356.6(3)    2.43%(3)       $239.7    1.84%        $209.6      1.93%
  Vendor Technology Finance             186.5(3)    3.17(3)         344.8    4.72          376.4(1)   4.15(1)
  Commercial Finance                     88.9       1.08             74.4    0.98           64.0      0.91
  Structured Finance                     85.6       7.34             94.9    8.06             --(1)     --(1)
                                       ------       ----           ------    ----         ------      ----
    Total Commercial Segments           717.6       2.40            753.8    2.59          650.0      2.42
  Consumer                              193.2       4.64            174.2    4.33          189.1(2)   4.62(2)
                                       ------       ----           ------    ----         ------      ----
    Total                              $910.8       2.67%          $928.0    2.80%        $839.1      2.71%
                                       ======       ====           ======    ====         ======      ====

Total non-performing assets
  Equipment Financing and Leasing      $373.8(3)    2.55%(3)       $267.4    2.05%        $139.9      1.29%
  Vendor Technology Finance              88.2(3)    1.50(3)         197.0    2.70          309.4(1)   3.41(1)
  Commercial Finance                     58.0       0.70             39.6    0.52           27.6      0.39
  Structured Finance                     96.1       8.24            107.8    9.16             --(1)     --(1)
                                       ------       ----           ------    ----         ------      ----
    Total Commercial Segments           616.1       2.06            611.8    2.10          476.9      1.77
  Consumer                              183.2       4.40            168.9    4.20          158.5(2)   3.87(2)
                                       ------       ----           ------    ----         ------      ----
    Total                              $799.3       2.34%          $780.7    2.36%        $635.4      2.05%
                                       ======       ====           ======    ====         ======      ====
</TABLE>

--------------------------------------------------------------------------------
(1)   All Newcourt  Segment data, at December 31, 1999, as presented  above,  is
      included in Vendor Technology Finance.  Additionally, the 1999 amounts and
      ratios do not reflect  integration  related  portfolio  transfers  between
      Vendor Technology Finance,  Structured Finance and Equipment Financing and
      Leasing.

(2)   For these calculations,  certain finance receivables held for sale and the
      associated past due and non-performing balances are included.

(3)   The  September  2000  balances  and  percentages  reflect the  transfer of
      certain  business  lines  from  Vendor  Technology  Finance  to  Equipment
      Financing and Leasing Segment made during the third quarter.  The June 30,
      2000 and December 31, 1999 balances do not reflect these transfers.

The third quarter  trends in  commercial  past due and  non-performing  accounts
reflect   improvements  in  collection   activities  at  the  servicing  centers
consolidated  earlier  in the  year.  The  increased  level of  delinquency  and
non-performing assets from June 30, 2000 for Equipment Financing and Leasing, as
well as the corresponding  decreases for Vendor Technology Finance, were largely
the result of the  transfer of


                                       22
<PAGE>

certain business lines from Vendor Technology Finance to Equipment Financing and
Leasing in July 2000.

INCOME TAXES

The  effective  income  tax rates for the third  quarters  of 2000 and 1999 were
37.8% and 34.5%,  respectively.  For the nine-month  periods ended September 30,
2000  and  1999,   the  effective   income  tax  rates  were  38.0%  and  34.7%,
respectively.  The increase in the 2000  effective tax rate was primarily due to
nondeductible goodwill amortization.

FINANCING AND LEASING ASSETS

Our  managed  assets  increased  2.4% from  June 30,  2000 to $54.6  billion  at
September 30, 2000, while total portfolio assets increased 2.8% to $43.8 billion
this quarter, due to seasonal growth in factoring receivables approximating $600
million partially offset by planned sales of non-strategic  portfolios  totaling
over $300 million.

The managed  assets of our  business  segments and the  corresponding  strategic
business units are presented in the following table.


                                       23
<PAGE>

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                   September 30, December 31,        Change
                                                       2000         1999        Amount    Percent
                                                    ---------     ---------   ---------   ---------
                                                                 (Dollars in Millions)
<S>                                                 <C>           <C>         <C>              <C>
Equipment Financing:
  Finance receivables (1)                           $13,179.2     $10,899.3   $ 2,279.9        20.9%
  Operating lease equipment, net (1)                  2,093.1       1,066.2     1,026.9        96.3
                                                    ---------     ---------   ---------   ---------
    Total                                            15,272.3      11,965.5     3,306.8        27.6
                                                    ---------     ---------   ---------   ---------
Capital Finance:
  Finance receivables                                 1,643.5       1,838.0      (194.5)      (10.6)
  Operating lease equipment, net                      3,447.3       2,931.8       515.5        17.6
  Liquidating portfolio (2)                             190.1         281.4       (91.3)      (32.4)
                                                    ---------     ---------   ---------   ---------
    Total                                             5,280.9       5,051.2       229.7         4.5
                                                    ---------     ---------   ---------   ---------
    Total Equipment Financing and Leasing Segment    20,553.2      17,016.7     3,536.5        20.8
                                                    ---------     ---------   ---------   ---------

Vendor Technology Finance:
  Finance receivables (1)                             6,436.0       7,488.9    (1,052.9)      (14.1)
  Operating lease equipment, net (1)                  1,209.5       2,108.8      (899.3)      (42.6)
                                                    ---------     ---------   ---------   ---------
    Total Vendor Technology Finance Segment           7,645.5       9,597.7    (1,952.2)      (20.3)
                                                    ---------     ---------   ---------   ---------
Structured Finance:
  Finance receivables                                 1,917.7       1,933.9       (16.2)       (0.8)
  Operating lease equipment, net                         35.7            --        35.7          --
  Other - Equity Investments                            274.4         137.3       137.1        99.9
                                                    ---------     ---------   ---------   ---------
    Total Structured Finance Segment                  2,227.8       2,071.2       156.6         7.6
                                                    ---------     ---------   ---------   ---------

Commercial Services                                   4,856.5       4,165.1       691.4        16.6
Business Credit                                       3,393.0       2,837.0       556.0        19.6
                                                    ---------     ---------   ---------   ---------
    Total Commercial Finance Segment                  8,249.5       7,002.1     1,247.4        17.8
                                                    ---------     ---------   ---------   ---------
    Total Commercial Segments                        38,676.0      35,687.7     2,988.3         8.4
                                                    ---------     ---------   ---------   ---------

Home equity                                           2,539.9       2,215.4       324.5        14.6
Manufactured housing                                  1,755.6       1,666.9        88.7         5.3
Recreational vehicles                                   547.6         361.2       186.4        51.6
Liquidating portfolio (3)                               316.9         462.8      (145.9)      (31.5)
                                                    ---------     ---------   ---------   ---------
    Total Consumer Segment                            5,160.0       4,706.3       453.7         9.6
                                                    ---------     ---------   ---------   ---------
    TOTAL FINANCING AND LEASING
        PORTFOLIO ASSETS                             43,836.0      40,394.0     3,442.0         8.5
                                                    ---------     ---------   ---------   ---------

Finance receivables previously securitized
  Commercial                                          8,650.5       8,471.5       179.0         2.1
  Consumer                                            1,662.5       1,987.0      (324.5)      (16.3)
  Consumer liquidating portfolio (3)                    480.1         580.8      (100.7)      (17.3)
                                                    ---------     ---------   ---------   ---------
    Total                                            10,793.1      11,039.3      (246.2)       (2.2)
                                                    ---------     ---------   ---------   ---------

    TOTAL MANAGED ASSETS                            $54,629.1     $51,433.3   $ 3,195.8         6.2%
                                                    =========     =========   =========   =========
</TABLE>

--------------------------------------------------------------------------------
(1)   During  the third  quarter  of 2000,  we  transferred  approximately  $1.7
      billion  of  finance  receivables  and $1.0  billion  of  operating  lease
      equipment from Vendor Technology Finance to Equipment Financing.

(2)   Consists  primarily of ocean going maritime and project  finance.  Capital
      Finance discontinued marketing to these sectors in 1997.

(3)   In 1999,  we  decided to exit the  recreational  boat and  wholesale  loan
      product lines.


                                       24
<PAGE>

CONCENTRATIONS

Financing and Leasing Assets Composition

Our ten largest  financing and leasing  asset  accounts at September 30, 2000 in
the aggregate  accounted for 3.7% of total financing and leasing assets,  all of
which are  commercial  accounts  secured by  equipment,  accounts  receivable or
inventories.

Geographic Composition

The following table presents financing and leasing assets by customer location.

--------------------------------------------------------------------------------

                           At September 30, 2000          At December 31, 1999*
                           ----------------------        -----------------------
                             Amount       Percent         Amount        Percent
                           ---------      -------        ---------     ---------
                                          (Dollars in Millions)
United States
    Northeast              $ 9,218.9        21.0%        $ 8,257.2         20.5%
    West                     8,524.7        19.5           7,594.0         18.8
    Midwest                  7,776.0        17.7           7,042.7         17.4
    Southeast                6,239.4        14.2           5,380.5         13.3
    Southwest                4,985.6        11.4           4,426.1         11.0
                           ---------       -----         ---------        -----
  Total United States       36,744.6        83.8          32,700.5         81.0
                           ---------       -----         ---------        -----

Foreign
    Canada                   2,328.9         5.3           2,797.5          6.9
    All other                4,762.5        10.9           4,896.0         12.1
                           ---------       -----         ---------        -----
  Total                    $43,836.0       100.0%        $40,394.0        100.0%
                           =========       =====         =========        =====

--------------------------------------------------------------------------------
*     Certain  December  31, 1999  balances  have been  conformed to the current
      period  presentation.

Our managed asset geographic  diversity does not differ  significantly  from our
owned asset geographic diversity.


                                       25
<PAGE>

Our financing and leasing asset portfolio in the United States is diversified by
state.  At September 30, 2000, with the exception of California  (10.8%),  Texas
(8.1%),  and New York (6.8%),  no state  represented more than 4.8% of financing
and  leasing  assets.   Our  managed  asset   geographic   composition  did  not
significantly  differ  from our  December  31,  1999  managed  asset  geographic
composition.

Financing  and  leasing  assets to  foreign  obligors  totaled  $7.1  billion at
September  30,  2000.  Following  Canada,  $2.3 billion  (5.3% of financing  and
leasing  assets),  the largest  foreign  exposures  were  England,  $1.2 billion
(2.7%), and Australia, $389.3 million (0.9%). Our remaining foreign exposure was
geographically dispersed, with no other individual country exposure greater than
0.8% of financing and leasing assets.

Financing  and  leasing  assets to  foreign  obligors  totaled  $7.7  billion at
December 31, 1999.  After  Canada,  $2.8 billion  (6.9% of financing and leasing
assets),  the largest foreign exposures were England,  $1.6 billion (4.0%),  and
Australia,   $397.6  million  (1.0%).   Our  remaining   foreign   exposure  was
geographically dispersed, with no other individual country exposure greater than
0.8% of financing and leasing assets.


                                       26
<PAGE>

Industry Composition

The following table presents  financing and leasing assets by the major industry
class of the customer.

--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                      At September 30, 2000           At December 31, 1999(4)
                                    ------------------------         ------------------------
                                      Amount        Percent            Amount        Percent
                                    ---------      ---------         ---------      ---------
                                                      (Dollars in Millions)
<S>                                 <C>                <C>           <C>                <C>
Manufacturing (1)
    (none greater than 3.1%)        $ 8,908.8           20.3%        $ 8,566.5           21.2%
Retail (2)                            4,701.0           10.7           4,032.0           10.0
Transportation (3)                    3,634.5            8.3           3,348.2            8.3
Commercial airlines                   3,285.4            7.5           3,091.2            7.7
Construction equipment                2,783.0            6.4           2,697.0            6.7
Home mortgage                         2,539.9            5.8           2,215.4            5.5
Service industries                    1,854.4            4.2           1,768.1            4.4
Manufactured housing                  1,755.6            4.0           1,666.9            4.1
Healthcare industries                 1,400.0            3.2             867.4            2.1
Wholesaling                           1,314.4            3.0           1,303.6            3.2
Other (none greater than 2.6%)       11,659.0           26.6          10,837.7           26.8
                                    ---------          -----         ---------          -----
  Total                             $43,836.0          100.0%        $40,394.0          100.0%
                                    =========          =====         =========          =====
</TABLE>

--------------------------------------------------------------------------------
(1)   Includes manufacturers of steel and metal products,  textiles and apparel,
      printing and paper products, and other industries.

(2)   Includes retailers of apparel (4.5%) and general merchandise (2.6%).

(3)   Includes rail, bus, and over-the-road  trucking  industries,  and business
      aircraft.

(4)   Certain  December  31, 1999  balances  have been  conformed to the current
      period presentation.

LIQUIDITY RISK MANAGEMENT

Liquidity  risk refers to the risk of CIT being  unable to meet  potential  cash
outflows promptly and cost effectively.  Factors that could cause such a risk to
arise might be a disruption of a securities  market or other source of funds. We
actively manage and mitigate liquidity risk by maintaining  diversified  sources
of funding.  The primary funding sources are commercial paper (U.S.,  Canada and
Australia),  medium-term  notes  (U.S.,  Canada  and  Europe)  and  asset-backed
securities  (U.S.  and Canada).  During the  quarter,  we issued $1.4 billion of
variable  rate term debt and $1.0  billion of fixed  rate term debt.  Consistent
with our prior  practice,  a portion of the variable  rate debt was  effectively
converted  into fixed  rate debt via  interest  rate  swaps for asset  liability
management  reasons. We also maintain committed bank lines of credit aggregating
$8.4 billion to provide  backstop  support of commercial  paper  borrowings  and
approximately  $212  million of local bank  lines to support  our  international
operations.  Additional  sources of liquidity  are loan and lease  payments from
customers  and  whole-loan  sales,   syndications  and  asset-backed  receivable
conduits. At September 30, 2000, $11.9 billion of registered, but unissued, debt


                                       27
<PAGE>

securities  remained  available under shelf registration  statements,  including
$2.0 billion of European Medium-Term Notes.

To ensure  uninterrupted  access to capital,  at October 31, 2000, we maintained
strong investment grade ratings as outlined below:

--------------------------------------------------------------------------------

                                            Short Term                Long Term
                                            ----------                ---------
Moody's                                         P-1                      A1
Standard & Poor's                               A-1                      A+
Fitch                                           F-1                      A+
Dominion Bond Rating Service                 R-1 (mid)                 A (mid)

--------------------------------------------------------------------------------

As  part  of  our  continuing  program  of  accessing  the  public  and  private
asset-backed  securitization  markets as an additional liquidity source, general
equipment  finance  receivables of $2,925.0 million were  securitized  ($1,331.3
million  in the third  quarter)  during the first  three  quarters  of 2000.  At
September 30, 2000, we had $2.5 billion of registered, but unissued,  securities
available   under  public  shelf   registration   statements   relating  to  our
asset-backed securitization program.

We also target and monitor certain  liquidity  metrics to ensure both a balanced
liability  profile and  adequate  alternate  liquidity  availability.  Among the
target ratios are  commercial  paper as a percentage of total debt and committed
bank line coverage of outstanding commercial paper.


                                       28
<PAGE>

CAPITALIZATION

The following table presents information regarding our capital structure.

--------------------------------------------------------------------------------

                                              At September 30,   At December 31,
                                                   2000               1999
                                                ----------         ----------
                                                    (Dollars in Millions)

Commercial paper                                $  9,292.3         $  8,974.0
Term debt                                         28,507.6           26,399.5
Company-obligated mandatorily
    redeemable preferred
    securities of subsidiary
    trust holding solely
    debentures of the Company                        250.0              250.0
Stockholders' equity                               5,858.9            5,554.4
                                                ----------         ----------
  Total capitalization                            43,908.8           41,177.9
Goodwill                                           1,987.1            1,850.5
                                                ----------         ----------
  Total tangible capitalization                 $ 41,921.7         $ 39,327.4
                                                ==========         ==========

Tangible stockholders' equity
    and Company-obligated
    mandatorily  redeemable
    preferred securities of
    subsidiary trust holding
    solely debentures of the
    Company to managed assets                         7.55%              7.84%
Total debt (excluding overnight
    deposits) to tangible
    stockholders' equity and
    Company-obligated mandatorily
    redeemable preferred securities
    of subsidiary trust holding
    solely debentures of the
    Company                                          9.09x              8.75x
Total debt (excluding overnight
    deposits) to stockholders'
    equity and Company-obligated
    mandatorily redeemable preferred
    securities of subsidiary trust
    holding solely debentures of
    the Company                                      6.13x              5.96x

--------------------------------------------------------------------------------

In the first nine months of 2000, we disposed of  approximately  $900 million of
non-strategic  assets to reduce leveraged and improve  returns.  This process of
evaluating low return and non-strategic businesses across CIT will continue.


                                       29
<PAGE>

STATISTICAL DATA

The following  table  presents  components of net income as a percentage of AEA,
along with other selected financial data.

--------------------------------------------------------------------------------

                                                     For the Nine Months Ended
                                                           September 30,
                                                    ---------------------------
                                                       2000             1999
                                                    ----------       ----------
Finance income (1)                                       12.56%            9.50%
Interest expense (1)                                      5.90             4.78
                                                    ----------       ----------
   Net finance income                                     6.66             4.72
Depreciation on operating lease equipment                 3.09             1.02
                                                    ----------       ----------
   Net finance margin                                     3.57             3.70
Other revenue                                             2.30             1.27
                                                    ----------       ----------
   Operating revenue                                      5.87             4.97
                                                    ----------       ----------
Salaries and general operating expenses                   2.57             1.86
Provision for credit losses                               0.63             0.44
Goodwill amortization                                     0.21             0.08
Minority interest in subsidiary trust
   holding solely debentures of the Company               0.05             0.08
                                                    ----------       ----------
   Operating expenses                                     3.46             2.46
                                                    ----------       ----------
   Income before provision for income taxes               2.41             2.51
Provision for income taxes                                0.91             0.87
                                                    ----------       ----------
   Net income                                             1.50%            1.64%
                                                    ==========       ==========

Average earning assets (dollars in millions)        $ 40,267.4       $ 23,213.9
                                                    ==========       ==========

--------------------------------------------------------------------------------
(1)   Excludes  interest  income and  interest  expense  relating to  short-term
      interest-bearing deposits.


                                       30
<PAGE>

                           PART II. OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

      (a)   Exhibit 12 - Computation of Ratios of Earnings to Fixed Charges.

      (b)   Exhibit 27 - Financial Data Schedule.

      (c)   A Form 8-K report dated July 27, 2000 was filed with the  Commission
            reporting the Company's  announcement  of financial  results for the
            quarter  ended June 30,  2000,  and the  declaration  of a quarterly
            dividend for the quarter ended June 30, 2000.


                                       31
<PAGE>

                                   SIGNATURES

      Pursuant to the  requirements of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                                    The CIT Group, Inc.
                                           -------------------------------------
                                                       (Registrant)

                                       BY             /s/ J.M. Leone
                                           -------------------------------------
                                                        J.M. Leone
                                               Executive Vice President and
                                                  Chief Financial Officer
                                              (duly authorized and principal
                                                    Accounting officer)

DATE: November 14, 2000


                                       32