Goldman owed $1 billion if CIT fails

NEW YORK (Reuters) - Goldman Sachs Group Inc (GS.N) would be due a $1 billion payment if troubled commercial lender CIT Group (CIT.N) were to file for Chapter 11 bankruptcy, the Financial Times reported on Sunday, citing people familiar with the matter.

The report said Goldman would be owed the payment under a $3 billion rescue finance package it gave to CIT in June 2008, before the U.S. government bought $2.33 billion of CIT preferred shares in December.

According to the FT, CIT "would be required to pay a make-whole amount" that totals $1 billion under that agreement.

Goldman is likely to agree to allow CIT to delay payment on some of the amount, according to the report. Beyond the $1 billion payment from its rescue package, Goldman would also receive payment from credit insurance it holds if CIT were to go bankrupt.

Goldman and CIT could not be reached for comment.

(Reporting by Michael Erman; Editing by Leslie Adler)