Monday, July 26, 2010
Richard Anderson passes away
Richard Anderson passes away
“Richard Charles Anderson, 73, passed away peacefully Tuesday, July the 20th, at his home in Phoenix, Arizona. He was born January 21st, 1937 in Minneapolis, Minnesotan to Charles and Alice Anderson. He served in the Army prior to graduating from the University of Minnesota. He worked most his life in Leasing and Finance (twenty years at LeaseAmerica.) Richard had a passion for living life and an energy that was boundless. He loved golf, good conversation, and his friends and family. He is survived by his loving wife Sheila Brooks Anderson, son Chad Anderson, sisters Patricia Polydisky & Susan Kennell, and brother Walter Anderson. Please join us at Richard’s life celebration on Saturday July, 31st from 2:00 – 5:00 PM at the Heritage Heights Unit 4 Clubhouse at 2837 E Mission Lane, Phoenix, Arizona.”
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LEAF Specialty to Vacate Premise by July 31st
Andrew Weddle, principal/managing partner for HighBridge Properties, Corte Madera, California, told Leasing News that Marketpark Offices owned by Al Said has agreed to a settlement with LEAF Financial on the 21,000 square foot office in Columbia, South Carolina. He credits it as a "win-win" for both sides due primarily to LEAF Financial CFO Robert Moskovitz.
The new tenant will start work Monday with IT and other improvement for 30% of the property. Marketpark Offices plans to lease the remaining 70% within 60 days, speaking to several probably tenants.
In the meantime, Dwight Galloway, LEAF Specialty CEO, continues with the hopes of having a new operation ready to open by August 2, 2010. Accordingly, he is to vacate the premises by July 31st and complete his negotiations and find a new office in the meantime. He was not available at press time for a comment. He remains as an "individual" member of the National Association of Equipment Leasing Association and National Equipment Finance Association.
August 18, 2008:
"LEAF Financial Corporation announces today that it will be consolidating two of its processing centers and transitioning essentially all of its third party operations and servicing to Columbia, South Carolina. This consolidation coincides with the September opening of LEAF’s new expanded facility in South Carolina. The new office will provide nearly 20,000 square feet of space and room for over 150 employees dedicated to serving the broker and third party market segment. With the opening of this new facility and business consolidation, LEAF will be phasing out its Santa Barbara, California location. The new location will combine the programs, products, and services of LEAF Third Party Funding (formally the leasing division of Pacific Capital Bank) and LEAF Specialty Finance (formally NetBank Business Finance) under one roof in order to provide third party lease originators an integrated solution for all of their business needs. Dwight Galloway has been promoted and will run the combined operations.
“Although combining operations is the right thing to do from an efficiency standpoint to better serve this market segment, it is personally very difficult to close our Santa Barbara office. The very talented employees, while only a small percent of our overall staff, have been a big part of LEAF’s growth and success over the past year,” said Crit DeMent, Chairman and CEO of LEAF Financial Corporation. “The opening of our new facility and expansion of our operations in Columbia demonstrates our commitment to the indirect market. While several financial institutions have abandoned this segment in the past several months, LEAF continues to be committed to supporting our valued partners.”
Financial Pacific updated Funder List ‘A’
A -Accepts Broker Business | B -Requires Broker be Licensed C -Sub-Broker Program | D -"Private label Program" E - Also "in house" salesmen
"FinPac has lowered their best rates by 400 bps to 12%. While our focus is still in our second tier credit niche with appropriate pricing, we are trying to respond to our TPO's (third party originators) needs in that better rate segment. We believe that our historical knowledge and the experience we've gained over the past two years helps us properly identify and price for risk."
Paul J. Menzel, CLP
Funder List “A”
Commercial Capital added to “Broker-Lessor” List
A - City Business License | B- State License | C - Certified Leasing Professional | D - State(s) sales/use tax license |E - Named as "lessor" on 50% or more of lease contract signed. |
“Commercial Capital Company has been in business for over 25 years centrally located in Overland Park, Kansas, a suburb of Kansas City. Throughout our history, we have been known as the company that can get it done.”
Click here: Commercial Capital Team:
Full List “A” Broker-Lessor:
Hiring Sales Personnel
One of the most difficult tasks for the leasing industry is hiring “competent” sales personnel. Some people are eager to work, but lack the skills to be a leasing sales person. Sales require a person who is aggressive, organized, neat, and personable. Sounds funny that I did not say smart or good looking, or even well dressed.
The smartest sales person I ever had work for me was fat, older, and mostly bald headed, But he was one that dressed for his market, enjoyed the people he called on and loved the market because those few industries were passions of his and he loved to talk about the equipment. He became a part of those industries and could discuss it with his customers. He not only knew his customer but much about the equipment they used in their industry.
Always hire someone that has sold before or expect a long ramp-up period. Learning sales is harder than learning leasing. However both can be taught if the person is capable. Most leasing companies try to teach their products and capabilities to their new sales staff but forget that they will face all kinds of competition and need to know leasing in its entirety.
Look for people that have sold equipment in the market you want to penetrate. They usually understand how important it is to know the subject completely and also they can get in to see the decision makers with relative ease because they have been there before. Generally they know the importance of leasing and financing and also know the equipment sales personnel from having been there. They may even have some information on customer needs they would help with your lease structures.
I think hiring sales personnel is made easier or harder by the markets you chose to approach and the equipment cost. Select your target markets that will accept your capabilities and your limitations and then look for sales personnel that fit those markets.
A sales person becomes a liaison between the Lessee and the Lessor. Someone who is a negotiator! Therefore they need to have people skills. Understanding leasing and credit is not enough. Any trained individual can review credit and price a deal, but someone that can sense what a lessee is looking for and can present reasons for accepting your proposal is rare.
Learning to “listen” to the lessee is one of the most important qualities of a successful salesperson. Knowing how to ask leading questions that lead the conversation into the structure that will be acceptable is a conversational talent. Listening to the lessee or the vendor and knowing when they are “over asking” for parameters that are out of reach and redirecting them back to what is possible takes patience. A good salesperson must be able to sell not just to present.
Look for people that are good at explaining a complex subject. Pick something they understand, but you do not, and have them explain it to you. Do not sound like you understand it too quickly and request them to try a different method or way for you to get it. You may even want to challenge their thought process. This will show their talent for listening to your difficulties to understand the subject, and then can they assess how to convince you that they are correct. See how they think out the problem and see if they can handle the presentation with finesse and maintain your good will. Those people that can teach a subject seem to have the listening skills required to learn what it takes to convince a lessee of the benefits of their leasing product.
I know that a good sales person can sell in any market but it is also important that your sales staff have longevity. The slow steady and consistent performer that stays around is preferred to the flash in the pan that produces excellent volume and then moves on. The longer you work with a customer base or a vendor the more stable your company will be and the secret to that is a stale sales staff.
Mr. Terry Winders, CLP, has been a teacher, consultant, expert witness for the leasing industry for thirty years and can be reached at firstname.lastname@example.org or 502-327-8666.
He invites your questions and queries.
Previous #102 Columns:
(This ad is a “trade” for the writing of this column. Opinions
Leasing Industry Help Wanted
Please see our Job Wanted section for possible new employees.
Top Stories---July 19-July 23
Here are the top ten stories opened by readers:
(1) U.S. Bancorp Oliver-Allen group Closing Down
(2) Correction ---U.S. Bancorp Oliver-Allen group Closing Down
(3) Funder List Up-dated: Bank of the West Leasing
(4) Two More Cases against Allied Health
(5) ABCO latest to file against Allied--More to follow?
(6) 7th Bank files against Allied Health Care Services
(7) Bank Beat---Ex BofA Exec. buy 23 Branches; MI,FL again
(8) US Bancorp Profits Increase—plus Leasing Numbers
(9) ZRG Partners—Unemployment is the worst behind us?
(10) Key Corp Starts to Control Leasing Portfolio
The Famous Leasing News “The List” ---June
U.S. Bank Manifest Funding Services, Marshall, Minn. (06/10) More cuts (06/10) Division changes, executives being moved to vendor side, brokers staff being cutback, brokers being informed on new requirements, many to be dropped.
GCR Capital, Safety Harbor, FL (06/10) Receives Bulletin Board Complaint not paying broker since January.
LEAF Financial (Philadelphia, PA (06/10) Having trouble with Columbia, South Carolina landlord regarding 21,000 square foot lease (06/10) Receives modified, lower line of credit.
Full Listing: Chronological:
Full Listing: Alphabetical
Bank Beat----103 Bank Failures
The pace of bank failures continues faster than last year at this point when it reported 64 bank failures. At this date, 2010, it now stands at 103.
The 100th bank to fail this year was accepted into the national banking group January 28, 1903, became part of the FDIC program when President Roosevelt started this program January 1, 1934 and when closed had 18 full time employees. They had opened their second branch 1917 in Hunter, Kansas.
The two branches of Thunder Bank, Sylvan Grove, Kansas were closed with The Bennington State Bank, Salina, Kansas, to assume all of the deposits.
According the Sylvan Grove Historic Society, "On March 4, 1892, eleven men met for the purpose of organizing a bank at Sylvan Grove. The capital stock of Five Thousand Dollars was subscribed and the name of the bank selected. On April 7, 1892, the Sylvan State Bank opened for business. It was a little wooden building located one block north of the tracks on the west side of main street. On November 12, 1894, the Sylvan State Bank was involved in an event that has survived the decades to become a legend – the first attempt to rob a bank in Lincoln County. An armed bandit robbed the bank, but upon his attempted getaway, was shot and killed by the bank cashier. Two accomplices on horseback managed to get away. All of the stolen money was recovered on the dead man.
"In 1912, a new brick bank was built with office rooms and then later the city library upstairs. This building, although renovated and expanded, still houses the bank in Sylvan Grove today."
2000 census states there were 324 people, 157 households, and 88 families living in Sylvan. The median income for a household in the city was $27,188, and the median income for a family was $36,375. 96% White Non-Hispanic (Ancestries: German (37.7%), English (11.7%), French (9.6%), Irish (8.0%), French Canadian (4.6%), Swedish (4.3%).
Over two-thirds of the businesses on the main street are located in limestone buildings.
As of March 31, 2010, Thunder Bank had approximately $32.6 million in total assets and $28.5 million in total deposits. The bank equity was $2 million, going from $3.3 million March 31, 2009, losing $200,000 the period before and $759,000 March 31, 2010 with $586,000 in non-current loans after a charge off of $195,000 ( $71,000 in construction and land development, $122,000 1-4 multifamily residential property, and $2,000 in loans to individuals. Tier 1 risk-based capital ratio 3.19%. The bank was considered to specialize in agricultural loans.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $4.5 million.
SouthwestUSA Bank, Las Vegas, Nevada was closed with Plaza Bank, Irvine, California, to assume all of the deposits.
When it opened May, 2001, it was Peter Kingman’s “vision" to have a "private banking services for elite clients...to serve the ever-growing affluent population in Southern Nevada...Unlike other banks, SouthwestUSA Bank has no teller windows or lines. Entering the bank foyer, clients encounter a beautifully appointed lobby with an aquarium and a large, wall-mounted flat-screen television tuned to the business and financial market news of the day. Once the client’s desired banking services are ascertained, meetings take place in a one-on-one conference room where a personal banking officer negotiates the desired transaction or banking service for the client. The system is designed to provide personalized service with absolute discretion. An additional unique amenity at the bank is a full-service, professional kitchen. It is designed to prepare refreshments for clients during routine visits or scheduled meetings, and also to provide for special events at the bank, such as financial planning seminars."
As of March 31, 2010, SouthwestUSA Bank had approximately $214.0 million in total assets and $186.7 million in total deposits. The bank had 33 full time employees.
Equity had dropped from $21.5 million to $9 million following a $3.6 million loss March 31, 2009 to a $866,000 loss March 31, 2010 but with $47.5 million in non-current loans. The FDIC and Plaza Bank entered into a loss-share transaction on $111.3 million of SouthwestUSA Bank's assets. Tier 1 risk-based capital ratio 4.68%.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $74.1 million.
The five branches of Home Valley Bank, Cave Junction, Oregon, were closed with South Valley Bank & Trust, Klamath Falls, Oregon, to assume all of the deposits. The bank was founded August 15, 1980 in Cave Junction, then in 1994 opened their first branch in Grants Pass, another in 1998, a third in 2004 and a fourth in 2007.
"Oregon's smaller commercial banks loaned heavily to residential real estate developers during the boom and paid a heavy price when the housing industry fell into disarray, “Jeff Manning wrote for the Oregonian. "With the exception of Central Oregon, Home Valley's home turf of Josephine and Jackson counties has suffered some of the steepest housing value declines and highest foreclosure rates in the state.
He notes, "Seven other Oregon banks are also operating under orders from regulators to boost their capital or otherwise improve operations: PremiereWest Bancorp of Medford; Albina Community Bancorp of Portland; Liberty Financial Group, parent of Liberty Bank of Eugene; Pacific West Bank of West Linn; Cascade Bancorp in Bend; Merchants Bancorp in Gresham; and Columbia Community Bank of Hillsboro. "
Home Valley Bank had 59 full time employees when they closed following a $403,000 loss March 31, 2009 and a $457,000 profit March 31, 2010, plus had reduced their non-current loans from $18.5 million to $12.8 million with $633,000 charge offs in real estate ( $621,000 construction and land development.) Bank equity had gone done from $17.4 million March 31, 2009 to $12.4 million March 31, 2010. Tier 1 was above the 5% goal at 6.70%. Among recent banks that were closed, this one appears healthy by the numbers and may have been more a management issue or perhaps geographical decision.
As of March 31, 2010, Home Valley Bank had approximately $251.80 million in total assets and $229.6 million in total deposits. South Valley Bank & Trust will pay the FDIC a premium of 1.05 percent to assume all of the deposits of Home Valley Bank.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $37.1 million.
As in a community fresh water fish tank, the first that grow larger than the small fish eat the smaller fish and become larger.
The six branches of Sterling Bank, Lantana, Florida, were closed with IBERIABANK, Lafayette, Louisiana, to assume all of the deposits.
For Iberiabank, this marks its third failed bank acquisition in Florida. In November, it acquired the assets and 34 branches of Sarasota-based Century Bank and Naples-based Orion Bank. The $8.7 billion-asset Iberiabank now has 220 offices in 12 states. The company said it now has $3 billion in deposits and 42 offices in Florida and should rank 20th in the state in deposits.
Sterling Bank was the fifth-largest bank chartered in Palm Beach County. As of March 31, 2010, Sterling Bank had approximately $407.9 million in total assets and $372.4 million in total deposits. The bank had 64 full time employees.
The net equity had gone from $27.6 million March 31, 2009 to $5.1 million with $30.1 million in non-current loans. The bank had lost $1.97 million the previous period and $5.47 million March 31, 2010 with charge offs of $3.3 million, all in real estate ($2.5 million construction and land development, $500,000 in 1-4 multifamily residential property, $332,000 in nonfarm nonresidential property. Tier 1 risk-based capital ratio 3.26%.
The FDIC and IBERIABANK entered into a loss-share transaction on $244.3 million of Sterling Bank's assets.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $45.5 million.
The 11 branches of Crescent Bank and Trust Company, Jasper, Georgia were closed with Renasant Bank, Tupelo, Mississippi, to assume all of the deposits.
As of March 31, 2010, Crescent Bank and Trust Company had approximately $1.01 billion in total assets and $965.7 million in total deposits. Renasant Bank will pay the FDIC a premium of 1.0 percent to assume all of the deposits of Crescent Bank and Trust Company. In addition to assuming all of the deposits of the failed bank, Renasant Bank agreed to purchase essentially all of the assets.
According to the Atlanta Journal-Constitution Newspaper, "Crescent was a heavy lender to subdivision developers, strip retail centers and builders of vacation homes. From 2004 to 2008, Crescent doubled in size from $500 million in assets to $1 billion, fueled by a diet of real estate development loans.
"Problems started in 2007 with the collapse of the housing market."
From the March 31, 2009 period to March 31, 2010 the bank had gone from 186 full time employees to 169, net equity had diminished from $56 million to $12.3 million after a loss of $4.7 to a loss of $13.2 with $112.6 million in non-current loans and a charge off of $12.8 million ($9.7 million construction and land development, $1.4 million in 1-4 multifamily residential property, $736,000 multifamily residential property, and $611,000 in non-farm non-residential property, as well as $233,000 in commercial and industrial loans. Tier 1 risk-based capital ratio 1.52%.
The FDIC and Renasant Bank entered into a loss-share transaction on $617.4 million of Crescent Bank and Trust Company's assets. Renasant Bank will share in the losses on the asset pools covered under the loss-share agreement.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $242.4 million.
The five branches of Williamsburg First National Bank, Kingstree, South Carolina were closed with First Citizens Bank and Trust Company, Inc., Columbia, South Carolina, to assume all of the deposits. The bank had 46 full time employees. First Citizens bought another failed bank in September, Georgian Bank of Atlanta.
As of March 31, 2010, Williamsburg First National Bank had approximately $139.3 million in total assets and $134.3 million in total deposits. First Citizens Bank and Trust Company, Inc. will pay the FDIC a premium of 0.5 percent to assume all of the deposits of Williamsburg First National Bank. In addition to assuming all of the deposits of the failed bank, First Citizens Bank and Trust Company, Inc. agreed to purchase essentially all of the assets.
Bank net equity had dropped from $12.8 million March 31, 2009 to $2.27 million March 31, 2010 following a $2.2 million loss, $13.2 million non-current loans and $3.5 Million charge off ($1.6 million construction and land development, $598,000 1-4 multi-family residential property, $1.199 million secured by non-residential non-farm property. Tier 1 risk-based capital ratio 3.02%.
The FDIC and First Citizens Bank and Trust Company, Inc. entered into a loss-share transaction on $64.4 million of Williamsburg First National Bank's assets.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $8.8 million.
Community Security Bank, New Prague, Minnesota was closed with Roundbank, Waseca, Minnesota, to assume all of the deposits. As of March 31, 2010, Community Security Bank had approximately $108.0 million in total assets and $99.7 million in total deposits. Roundbank will pay the FDIC a premium of 0.89 percent to assume all of the deposits of Community Security Bank.
They had 23 full time employees with bank equity going from $9.9 million March 31, 2009 to $3.37 million March 31, 2010, following a $653,000 loss the previous time period and $1.8 million March 31, 2009 with $20.4 million in non-current loans. Tier 1 risk-based capital ratio 2.12%
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $18.6 million.
List of Bank Failures:
((Please Click on Bulletin Board to learn more information))
Housing and Banks and Equipment Leasing
The dots connect from the housing marketplace to banks and involve equipment leasing as one of the industries affected. From writing the Bank Beat column every Monday, and also seeing the news from the bank trade publications, the construction and land development has taken a very large hit. In almost all the bank failures, the huge write offs and non-current loans fall into this category. A survey recently found 80% of the regional and small banks out of this market place. Driving down the street and seeing a sign that says, "Construction Financing by First National" is rare today.
One reason is the "take out" loan being available, another is the interim financing not be available, and thus the construction industry is down, one of the largest numbers of activity in the Equipment Leasing and Finance Industry monthly report. This in turn affects employment, property values for schools, taxes for cities and counties and states, and gives many business fear about spending cash or extending credit to expand their business.
In addition, it takes away a profit center from smaller banks that are being squeezed out of other products by the very large banks and their pricings as well as products.
According to Al Schuler, who Leasing News has been quoting for almost ten years as the US Agriculture forecaster, involved in wood products ( the key to understanding construction of new houses and commercial property), new housing will continue to fall not only due to mortgage money available, but the over building of homes in many areas of the United States:
"Regionally new housing starts were weak everywhere: the northeast was off 11.3%; Midwest was off almost 7%; the south was off 2.4% 5 and the west was down 5.9%.
He predicts new home construction will continue to fall, particularly without tax stimulus or other government incentives.
"Although we have a number of difficult problems facing the economy, there are two "elephants" that will hold back the economy for an extended period of time.
“(1) Debt - which exists at both the government level (federal, and state), and the private sector, particularly individual citizens. Those sectors that don't have access to "printing presses" ( i.e., you and me), are deleveraging or paying off debt.
“2) Jobs - the job market is stabilizing 5 but consider these alarming numbers:
14 million remain unemployed -
Both the debt problems and the weak job market will continue to impact consumer spending ( 70% of the economy) including housing expenditures. An indicator of consumer spending is confidence that too is feeling the impact of the weak job market.
"Another set of issues the mortgage market, foreclosures, and housing supply:
--The mortgage market is in a state of disarray to put it mildly 95% of the mortgages written, held, or insured in the past 24 months were by the GSE's ( Fannie, Freddie, etc.). They hold/insure about 53% of all residential mortgages here in the USA. Fannie and Freddie have an enormous amount of debt, and by the way, they were placed in conservatorship two years ago ( i.e, insolvent).
--Foreclosures will continue to be a problem 24% of U.S. mortgages are underwater.”
“--- We built too many homes over the past decade according to some analysts, this one included. If you compare houses built ( net of houses torn down) with household formations, beginning in the early 1990's, we probably built about 4 million excess homes. E.g., between 2002 and 2006, we built 12 million new homes while the number of households went up by 7 million.
“If you subtract about 1 million destroyed (beyond economic life, etc.), the "net" is 11 million new supply compared with 7 million (household formations) demand: 11 million 7 million = 4 million excess supply.”
The question is does this mean Florida, Arizona, Nevada, and California or areas hardest hit by unemployment, such as Michigan, or suburban areas from larger population areas that were at one time expanding and today are not.
Or is this a trend for home re-modeling or tearing down old homes or just abandoning them, which are happening in areas of Illinois and Michigan.
SPENCER - Male, Beagle
"Spencer is your typical handsome, forty pound, five year old Beagle. He was turned in by a local family. They were moving out of the country and could not take him with them. Spencer is affectionate, comical, and keeps his nose to the ground. He would do best in an adult home or with a family with older children"
Glendale Humane Society
Adopt-a-Pet by Leasing Co. State/City
Adopt a Pet
BP chief Tony Hayward 'set to stand down'
LEAF Financial Announces expansion of capital
Naked Cowboy Slaps Leather at Naked Cowgirl
40,283 of our neighbors are in mortgage limbo
California Chardonnay With a French Accent
Dan Berger: Blended reds are back in style
Chianti Classicos With an Identity Crisis
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This Day in American History
1526 - The Spaniard Lucas Vasquez de Ayllon and his colonists left Santo Domingo in the Caribbean for Florida.
I have a friend that calls it
the good ole boys
I heard Dietz said
that required a windshield.
the denial itself is legendary,
and later the country drawl,
Written by Tim Peeler
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