Diversification is afoot
Diversification was floated as a strategic aim for the sector in order to drive growth for the future. The trend had already been seen among some leasing companies, such as GE Capital which had combined its fleet, contract hire, business lending, factoring and equipment finance divisions. A straw poll at the Leaseurope Convention the previous year confirmed that the industry was looking to broaden its scope in order to meet customers’ needs.
Syndicated in Spain
SG Equipment Finance led a record leasing arrangement in the Spanish private health sector, financing all the equipment for Vinalopo Hospital in Alicante.
The syndicated deal was worth €30.3m, and was supported by a number of finance houses. Assets financed include equipment for diagnostic imaging, nuclear medicine, radiation, ventilation, anaesthesia, and other clinical equipment, as well as the furniture.
Microsoft picks funding partners
Global IT giant Microsoft named BNP Paribas Leasing Solutions, SG Equipment Finance and De Lage Landen as its primary funders at the start of the year.
Uncertainty remained over the future for the UK programme, which was handled as a ‘gentlemen’s agreement’ with DLL: in March the lessor was confirmed as the continued UK partner. Microsoft had in July 2009 ended a five-year agreement with CIT worth $649m.
First electric HGV contract
Truck lessor Ryder delivered a 10-tonne Smith Newton truck to distribution and outsourcing group Bunzl, after signing a 10-year contract hire agreement believed to be one of the first lease deals for an electric HGV in the UK (see picture, below).
The new truck, designed specifically for stop-start work in London, was set for work in the catering and hospitality sector. Its maximum range is 80 miles.
ING Lease goes for German brokers
ING Lease announced its intention to build a broker business in Germany.
The move reflected the company’s strategy to extend across Europe and to be an ‘influential force’ in its chosen markets. CEO John Howland-Jackson described Germany as “a huge opportunity”.
Quest for growth
A gentle wave of expansionist activity began in April, as Deutsche Leasing, HSBC Equipment Finance, Raiffeisen Leasing and UniCredit Leasing all looked for growth.
HSBC Equipment Finance targeted new markets; Deutsche Leasing focused on direct sales and vendor business; and Raiffeisen Leasing was anticipating much greater access to capital following its merger with Austrian parent Raiffeisen Zentralbank Österreich.
UniCredit Leasing was aiming for growth after restructuring some business divisions.
Barclays reshuffles top team
Barclays Asset and Sales Finance underwent a management reshuffle and joined the bank’s newly formed products division.
Ian Stuart moved to concentrate on a sales role, and John Kelting became head of products within Barclays Corporate.
Alex Brown, Barclays head of asset finance, and John Bevan, head of sales finance, began reporting to Kelting.
Energy, rail and waste go green
A raft of new opportunities for lessors appeared across waste management, renewable energy and rolling stock, as European governments sought to meet green targets and expand transport networks. In the UK, green transport came into the spotlight with a renewed focus on improving rail links, and financing electric vehicles.
Dilek Mackenzie, director of funding services provider Deem Solutions, said: “The overall vision set by the government for the transport sector suggests that electric drive and alternatively fuelled vehicles for private and public use will increase, resulting in new funding opportunities.”
Anaerobic digestion also moved up the agenda, in a move welcomed by green plant equipment lessor Compass Business Finance.
Margins hold steady at mid-year
The results of the Business Confidence Survey, in association with Invigors, showed that new business growth, less bad debt and higher profits were expected in the second half of 2010.
However respondents anticipated that capital availability would remain unchanged, and that margin improvements would stall.
Mortgage and invoice discounting brokers looking to enter asset finance contributed to record numbers attending the annual conference of the UK National Association of Commercial Finance Brokers.
Lessors exhibiting at the 2010 event included ING Lease UK and niche funder Liberty Leasing.
Lease accounting outcry
Proposed changes to lease accounting standards released in August attracted widespread criticism from the industry.
Tanguy van de Werve, director general of Leaseurope, said he was “disappointed that the IASB and FASB have not taken on board the feedback that we and many others provided.”
Julian Rose, head of asset finance at the FLA, claimed the proposals would result in financial reports being a “mish-mash of accountants’ assumptions, estimates and adjustments”.
Top lessors ranked for 2009
The annual Leaseurope ranking named BNP Paribas Equipment Solutions as the largest lessor, ahead of last year’s number one UniCredit Leasing, which dropped to fourth.
From the UK, only Lloyds TSB Asset Finance appeared in the list, at number 11.
French companies SG Equipment Finance and Crédit Agricole Leasing took second and sixth place respectively.
Gap in the marine market
The closure of Barclays Marine Finance was confirmed as the Southampton Boat Show kicked off (see picture below).
A Barclays spokesman said it took the strategic decision to close the marine finance division to new business following “a detailed review of the challenges of operating in the sector”.
The resulting gap in the UK market sparked a rush of interest from funders including Société Générale joint venture SGB Finance.
Leading lessors rebrand
Amstel Lease announced that it would rebrand as ABN Amro Lease, taking its parent bank’s name. BNP Paribas Lease Group also changed its moniker to BNP Paribas Leasing Solutions.
The move by Amstel reflected its strategy to grow leasing business with ABN Amro’s corporate banking customer base. It has 350,000 business customers in the Netherlands, of which 80,000 to 100,000 are considered potential leasing clients.
Road haulage fleet
Barclays Corporate Asset Finance signed a multi-million pound deal with Eddie Stobart Ltd, the UK-based road haulage company.
The investment included two arrangements to fund skeletal and curtain-sided trailers, at a total of 265 units, and a cost of more than £5m (€5.7m).
The deal was coordinated by BCAF in Manchester, led by regional sales director Stirling Hulme.
The aim was to provide funding for Eddie Stobart to make a major addition to its trailer fleet.
See also: People news of the year