Dear readers, welcome to
Basement Talk, Leasing Life’s monthly diary page, filled with the
latest gossip and insight on the less visible aspects of the asset
finance industry
Go deeper with GlobalData
Shire’s adventures in telephone
systems
Exactly a year ago this month,
several directors of Shire Leasing decided enough was enough and
sold their stakes in telecoms services company S1 Networks.
According to a spokesperson for the leasing
broker, they sold their stakes “because they felt they didn’t have
the skills set to operate it”, and also as “they wanted to make
money out of it but never really managed to make much money out of
it”. Public accounts published earlier this year show that S1 made
losses in 2008 of £125,823 and £171,245 the year before.
Not long after this sale took place, Shire
Leasing then faced problems, much reported in this magazine as well
as by regional media and the BBC, with telecoms related leases it
brokered from the suppliers Global Telecoms & Technology and
also Business Telecoms Ltd.
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By GlobalDataIt has, indeed, not been the best of years for
Shire and its telecoms enterprises.
‘Usually high’
Far be it from Basement Talk to cast
the first stone when it comes to typographical accuracy, but it
would seem that poor old 1pm Business Finance needs to either hire
an extra proofreader, or at least learn to be less hard on
itself.
In a press release dealing with recent trading
results, the company announced that during September it had
terminated a “usually high number” of lease agreements, leaving us
to wonder: if this is the usual, what happens in months where not
enough deals go wrong?
When the financial world finally settles down,
1pm – which we thought was a pretty decent underwriter – may have
to start bankrupting its own customers to maintain “usually high”
impairment rates.
It is a mystery
Having heard from around half a
dozen reputable sources that Fortis Lease has pulled out of
broker-introduced business, we decided to go to the horse’s mouth,
and phoned the mobile of Fortis Lease’s broker manager (having
found his number on their very own website).
Is it true? we asked.
I don’t know, came the reply.
Hmm, a head of broker business who doesn’t
know whether broker business is still being transacted – we don’t
really know what to say to that.
The snag of
securitisation
A recent Leasing Life report on work
recently done by asset finance departments of law firms revealed
just how much securitisations are really taking place in this
industry.
Denton Wilde Sapte reported that it acted as
English legal counsel for a European bank on a $70 million (€46.8
million) securitisation of service contract receivables, and let’s
not forget the £300 million (€330.7 million) securitisation of Ford
Credit Europe’s receivables linked to dealers in no less than 76
jurisdictions.
If that isn’t enough proof of just how booming
the lease securitisation industry really is, then turn to page six
of this issue to see yet more trading of such deals.
Potentially all good news. The one snag is
that, according to a snippet overheard by Basement Talk at the
FLA’s autumn drinks party last month, just before the recession,
lawyers were preparing to securitise tens of millions of pounds of
subprime financed assets – most of which had AA or AAA ratings.
Speed dating and the FLA
After the sheer reluctance of the UK
leasing community to leave at the end of its Summer Drinks event,
the FLA had no choice this month but to host an Autumn sequel,
which took place on 8 October at the Royal College Of
Physicians.
Despite many financiers wistfully commenting
that they were tempted to jump ship to the speed dating event being
organised elsewhere in the building, the lure of industry gossip
and tiny bowls of fish and chips was enough to keep people talking
intently until close of play.
The FLA should be congratulated – not only on
providing an opportunity for networking at a time when everybody’s
mind is on forward planning, but for managing to run the only
industry event we have seen since The Crunch where the guestlist
slightly exceeded the capacity of the venue.
Encouraging stuff – here’s hoping for an even
bigger turnout come Christmas Drinks on 1 December at Church House
Conference Centre.
Leasing to the poor
Around 45 in 100 people have
declared a lower income than what they paid for leasing their cars,
Italian tax authorities have discovered.
The investigation, which is part of a large
cross-check operation across Italy, revealed that people who were
declaring low or no incomes had lease agreements for luxurious
cars, including Porsche and Maserati models.
The widespread malpractice also involved
companies, with around 16 percent of them declaring lower revenues
than what they paid for their company cars.
Swine flu
Which finance lawyer tried to force
himself into a Stagecoach rolling stock procurement meeting while
suffering from swine flu, only to be forced out by the assembled
group of execs?
