The Icelandic banks had collapsed owing
depositors, charities and local authorities billions of

RBS, Lloyds and HBOS were partly taken over by UK plc. Rescue
packages were put together for Fortis, Hypo Real Estate, Bradford
& Bingley and Alliance & Leicester.

Meanwhile, the UK government was risking £500 billion (of
taxpayers’ money) to support its banking system in addition to £119
billion for Northern Rock.

Fortunately, I woke up before discovering what was happening in
the Americas and Asia Pacific – it couldn’t be any worse.

Back to reality, there is recent evidence of falling new
business levels, although the Finance & Leasing Association
reports a stable position to July 2008. Margins are increasing and
competition is evaporating.

A significant downturn is expected in what is now referred to as
the ‘real’ economy.

As some of our businesses are counter-cyclical, I am expecting
an increase in activities at LPM outsourcing, the portfolio
management business.

Also, Specialist Fleet Services, which provides contract hire
for refuse vehicles to local authorities, continues to expand.

Asset values are, in general, reducing, which will make it
challenging for State Securities as the economy deteriorates.

But profits for the first six months are in line with the
previous year. So it must have been a nightmare.

Sam Geneen

The author is managing director of Five Arrows Leasing