ING Lease in Germany is closing down its forfeiting business,
Leasing Life can reveal.
The move follows a strategic assessment of the 14 European ING
Lease businesses, and can be attributed to capital allocation
issues, ING Lease has confirmed.
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“ING Lease Deutschland is closing down its forfeiting business
so it can focus on its direct business,” said Gerlach Jacobs, a
director at ING Lease Holding.
Alain Vervaet, the CEO of ING Lease Holding, explained that
close to 50 percent of ING Lease Deutschland would be made
redundant as a result of the closure.
“We have been looking closely at our business units and
measuring their performance. The recent economic turmoil has meant
we have had to accelerate some measures,” said Vervaet.
“The forfeiting business was unique to Germany, and this was
just not a business model that we wanted to continue with. This is
not a general cut in our businesses; this is not the start of a
trend.”
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By GlobalDataForfeiting is a financial instrument whereby a company will sell
a part of its receivables portfolio at a discount. The receivables
and the risk are transferred to the buyer’s balance sheet. In ING
Lease’s case, the company was specifically refinancing portfolios
from other leasing companies.
“The German market is not an easy one,” said Vervaet. “ING Lease
has many competitors and we don’t have the distribution channels
for going into the Mittelstand [Germany’s main band of family-owned
SMEs], or the resources for setting up our own channel.
“This was why forfeiting formed the bulk of our operations
there.”
The forfeiting business will be closed down before the end of
the year, and the ING Lease Deutschland business is to be
re-oriented into a number of other niches, according to
Vervaet.
In October, ING Lease Deutschland, headquartered in Hamburg,
employed 44 employees and had a portfolio of €520 million. It is
understood that forfeiting formed an important part of its
business.
This move comes one month after ING Lease announced plans for
European expansion. Last month, Leasing Life reported on ING Car
Lease’s acquisition of Universal Lease Iberia, which has
effectively doubled the ING Lease subsidiary’s Spanish fleet.
Jason T Hesse
In brief
Crédit Agricole and Intesa in M&A deals
M&A activity has not completely died in leasing with the
announcement last month that Crédit Agricole has acquired OTP
Leasing in Slovakia.
The acquisition of OTP, part of Hungarian group OTP, takes place
ahead of Slovakia’s adoption of the euro and will provide direct
access to the local market.
An agreement between Crédit Agricole Leasing and Intesa Sanpaolo
is also understood to have reached its final stage.
The transfer of all of Cariparma-Friuladria’s leasing operations
to Crédit Agricole Leasing is expected to take place later this
month. The two Italian banks were purchased from Intesa Sanpaolo in
2007.
