July 13 (Bloomberg) -- CIT Group Inc., the century-old lender, may receive assistance from the U.S. government to prevent a collapse that could hurt hundreds of thousands of corporate borrowers, the Wall Street Journal reported.

U.S. officials are “in advanced talks” about aid for New York-based CIT Group, the newspaper said today, citing people familiar with the matter. No final deal was yet reached and the cost of any rescue isn’t known, the Journal reported.

The company’s bonds and stock fell today on concern that it won’t be able to meet credit obligations. A collapse would put 760 manufacturing clients at risk of failure and “precipitate a crisis” for as many as 300,000 retailers, the lender said in internal documents obtained by Bloomberg News that make the case for its importance to the U.S. economy. CIT spokesman Curt Ritter declined to comment on the documents.

CIT’s $1 billion of floating-rate notes maturing in August plummeted 14.375 cents to 80 cents on the dollar as of 4:21 p.m. in New York, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The stock declined 18 cents, or 12 percent, to $1.35 in New York Stock Exchange composite trading.

CIT executives spoke with regulators through the weekend, according to a person familiar with the talks. CIT may default as soon as April, when a $2.1 billion credit line matures, according to Fitch Ratings.

The Federal Deposit Insurance Corp. may assist CIT through a program that guarantees new debt, the Wall Street Journal reported.

--Pierre Paulden and Caroline Salas in New York. Editor: Rick Green

To contact the reporter on this story: Dan Reichl in San Francisco at dreichl@bloomberg.net

Last Updated: July 13, 2009 18:56 EDT