Antonio Fabrizio talks risk with Frederik Linthout
The recent rebranding of Germany’s HVB Leasing to UniCredit Leasing GmbH is the latest example of the Milan-headquartered lessor’s new strategy to promote a shift from “patchwork to network” across its European satellites.
But if the change in form is notable and visible, there’s no change in substance for a leasing company which was founded back in 1963 and which helped to pioneer the German leasing market. In fact, the German lessor will continue to be 100-percent owned by HypoVereinsbank (itself owned by UniCredit since 2005), and the same key people will be still there, including the company’s CEO Frederik Linthout.
Linthout has been working at the lessor for over 20 years, and currently has responsibility for risk, finances and IT, while his colleague Stefan Lechner is in charge of the sales function.
This distinction follows German financial regulations, which require that leasing companies which also are banks – as in the case of UniCredit Leasing GmbH – have two separate CEO roles for origination and credit decision. From the risk point of view, Linthout has always run a tight ship, and this was reflected in the company’s recent performance.
Indeed, while risk provisioning has considerably increased following the financial crisis, September 2009 figures showed that the company still had a satisfying performance in terms of risk provisioning compared with the rest of the German market, Linthout said.
A large part of that is directly attributable to his strategy, which has included a cautious approach in areas like road transport and automotive, two of Germany’s worst-hit sectors. However, according to Linthout, recovery rates have been satisfactory and at fair values, thus reducing losses. Recent deals have included a €20 million rail financing project, as well as a contract with a supermarket chain and another with a logistics company for tank containers, both multi-million euro investments.
UniCredit Leasing GmbH is also investing heavily in renewable energy, and is in the process of finalising a €50 million project in the photovoltaic sector.
Compared with 2008, the company’s new business volume this year has so far decreased by around 25 percent, less than UniCredit Leasing Group’s 40 percent average drop.
The decrease has been offset by higher margins, in line with the rest of the German market, and following a number of years when huge competition significantly narrowed margins.
UniCredit Leasing GmbH
CEO (risk): Frederik Linthout (pictured)
CEO (sales): Stefan Lechner
Employees: 330 in 8 branches
Market share: 5 percent (without captives)
Market share: 2.5 percent (including captives)
Owned by: HypoVereinsbank (part of UniCredit Group)