Pascal BOUILLON, Deputy CEO

1 / 9
About This Presentation
Title:

Pascal BOUILLON, Deputy CEO

Description:

While some large, international banks have developed this activity ... copier. telecommunication. IT (retail distribution) medical equipment. medical equipment ... – PowerPoint PPT presentation

Number of Views:62
Avg rating:3.0/5.0
Slides: 10
Provided by: andreass9

less

Transcript and Presenter's Notes

Title: Pascal BOUILLON, Deputy CEO


1
How Banks work with Leasing Companies in
Europe Strategy of Banks entering the Leasing
Market
  • Pascal BOUILLON, Deputy CEO
  • Kiev, February 21, 2006

2
Leasing for Banks
  • Initially, in most European countries, Leasing
    has been tailor made to suit the banks clients
    needs as an alternate solution to loans
  • While some large, international banks have
    developed this activity as asset/equipment
    financing, a core activity through dedicated and
    specialized entities
  • Many have exited this business during the last 20
    years
  • While some independent leasing companies have
    been created, especially in countries where
    Leasing is not regulated

3
How Banks work in Leasing
  • Today many retail banks are not involved at all
    in leasing
  • Other are refinancing Leasing Companies
  • Line of credit
  • Assignment of receivables
  • Assignment of contracts
  • Others
  • Or cooperate with Leasing companies
  • Referral
  • White labelling
  • Joint venture,
  • Few have set up a dedicated business entity
  • Critical mass
  • Expertise

4
Refinancing of leasing companies (1)
  • Need to hedge
  • assets and liabilities
  • Interest rate, liquidity, exchange rate
  • Access to capital market in mature countries
  • Secured line of credit
  • Requires a specific legal environment to achieve
    perfect lien on receivables or assets
  • Unsecured line of credit most of the time
  • Flexible solution
  • Need to monitor the risk of mismatched funding
  • Assignment of lease receivables, with recourse
    (without transfer of risk)
  • Problem of exposure of the Leasing company
  • Analysis of the origination of portfolio, quality
    of transactions
  • Block discounting allows easier match funding

5
Refinancing of leasing companies (2)
  • Assignment of lease receivables, without recourse
    (with transfer of risk)
  • Assignment of the future lease instalments
  • Depending on the local legal environment
  • Requires specific risk analysis assessment of
    portfolio, how business is originated, credit
    policy, currency risk, Residual Value risk,
  • Security are difficult to organise
  • Title on equipment regulation are different from
    one country to another and are difficult to
    implement
  • Assignment of contracts
  • Requires minimal legal environment
  • Lease syndication through a pool, allowing
    refinancing of small leasing companies by larger
    ones
  • Disclosed or undisclosed
  • With or without mandated billing and collection

6
Cooperation agreements
  • Referral
  • Simple cooperation with agreement on price, fees,
  • White labelling
  • Undisclosed or partially disclosed
  • Joint Venture
  • With minority shareholders
  • Without external shareholders
  • Servicing
  • Bank subsidiary managed by leasing company

7
Asset and Equipment FinancingA specialised
business
  • Industry expertise
  • High Tech
  • Industrial Equipment
  • Transportation
  • Based on equipment knowledge
  • Collateral assessment (amortization, second-hand
    value, residual value)
  • Better knowledge of client business

8
Industry Expertise
Transport
Industrial Equipment
High Tech
  • IT
  • hardware
  • software
  • peripheral
  • transport
  • trucks
  • commercial vehicles
  • busses
  • machinery
  • machine tool
  • printing machine
  • packing machine
  • handling
  • forklift trucks
  • handling equipment
  • construction machines
  • loader
  • dredger
  • earth moving equipm.
  • office equipment
  • copier
  • telecommunication
  • IT (retail distribution)
  • agricultural machinery
  • tractors
  • harvesters
  • medical equipment
  • medical equipment
  • laboratory equipment
  • real estate
  • office building
  • aviation and marine
  • aircrafts
  • ships

9
Significant growth in emerging countries
  • Average penetration rate in Europe 15
  • Czech Rep. average 18 since Y 2001
  • Hungary 22 in Y 2004
  • Slovakia 15
  • Slovenia 20
  • Poland, penetration doubled within 4 years
  • Relevant market (excluding cars) has reached a
    significant size
  • Poland 2.4b
  • Czech Republic 2b
  • Hungary 700M
  • Slovakia 600M
  • Slovenia 400M
Write a Comment
User Comments (0)