Chairman’s letter DEAR SHAREHOLDERS: OUR BUSINESS MODEL DELIVERING TO OUR STAKEHOLDERS FOCUSING ON BUSINESS FUNDAMENTALS As we complete this three-month period that brings CIT back to a calen- dar-year reporting cycle, I wanted to take the opportunity to share with you some thoughts on business performance and the outlook for the year to come. In a year of unprecedented distractions, CIT, focused and determined, finished the past twelve months in solid financial condition. Credit for this performance must be given to the employees of the organization and a tried and true business model.This model, which calls for maintaining a diverse portfolio mix, emphasizing strong credit management, retaining industry and product expertise, preserving a strong balance sheet with high credit ratings, solidifying existing leadership positions and continually improving productivity has served us well in these times. Our diversification is sup- ported by building business in areas where we have years of success and market leadership positions such as factoring, vendor financing, and, small business lending, just to name a few. During the last quarter, we worked hard to reduce our delinquency and non-performing asset levels. Additionally, we saw some improved business volume in virtually all of our franchises, in spite of the eco- nomic environment. And our improved capitalization, with reduced leverage, demonstrates our commitment to maintaining a strong balance sheet. We rem a i n cog ni za nt of t he need to del iver va lue to a l l our constituencies and are confident that our practical and focused approach to our various businesses is the right one for all environments, including this one. We are seriously committed to our business strategy. It has guided CIT successfully for years and has served us well. CIT is a company that adheres to the basics, buck- ing “trends” and “fads”, and “pop” financial cultures, and that’s the way we deliver to clients, employees  and shareholders. Thank you for your continued support. see prudent asset growth. It is this course of action that will enable us to move toward our long-term financial goal of 15 percent return on tangible equity. Our biggest challenge to meeting this metric is improving business funda- mentals so that our borrowing costs can return to historically low levels, com- mensurate with our strong credit rat- ings.These higher borrowing costs have squeezed our margin since last summer. Asecondchallenge,beyondourcontrol, is the overall economy. I hope the economic malaise will lift as the year progresses, but for now we must operate in a period of lower growth, positioning CIT with the appropriate levels of capital and resources to take advantage of the economic turnaround that will take place in the U.S. In 2003, the job before us is straightforward: we must improve credit quality, be persistent in our efforts to get more operating efficiencies out of the organization, and put resources into those markets where we want to Albert R. Gamper, Jr. Chairman, President and Chief Executive Officer  ALBERT R. GAMPER, JR.