CIT Vendor Finance, the leasing division of CIT Group, reported 19% year-on-year growth in final quarter pre-tax profits for 2012, primarily due to "improved funding costs" and the sale of its Dell Europe platform.

The results, which exclude accelerated FSA interest expense related to CIT Group’s debt pay-off, were partially offset by higher credit and operating costs. There was also a $14m (€10.4m) one-off gain due to the sale of the Dell Europe vendor partnership back to the computer manufacturer.

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Despite a profitable end to the year, following losses in previous quarters, the US bank’s leasing arm made a pre-tax loss of $107.9m in 2012, compared to $144.8m pre-tax profit in 2011.

CIT Vendor Finance funded $867.5m in new business for the fourth quarter, up 23% on the third quarter and 21% on the fourth quarter in 2011. The division reported that it total financing and leasing assets grew by 4% from the previous quarter and by 8% year-on-year, to $5.4bn.

CIT also reported a modest decline in accrual loans to $72m; and net charge-offs of $5m, down from $10m in the third quarter but up from $2m in the fourth quarter of the previous year.

Parent company CIT Group reported $207m net income for the quarter, leading to a net loss of $592m for the year, compared to net income of $15m for 2011.

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John Thain, chairman and chief executive officer of CIT Group, said: "We made significant progress in advancing our corporate strategy in 2012".

"We grew commercial assets, diversified our funding mix, and expanded new business initiatives that further support our small business and middle market clients.

We remain focused on positioning CIT for future growth and profitability as we drive operating efficiencies, prudently grow our assets, and expand CIT Bank."