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Archives June 22, 2004
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Archives June 22, 2004
As business continues to increase, BSB Leasing, Inc., after ten years in the same Denver, Colorado location has relocated to new and larger facilities. The new address is 6 Inverness Court East, Suite 125 Englewood, Colorado 80112.
BSB Leasing, Inc. is a direct funder and syndicator serving lease brokers nationwide since 1982.
“The new location will allow BSB to continue hiring additional staff in the short term and will give us additional capacity to add staff in both the sales areas and in administration, “
Don Myerson, president, said. “The need for additional space and facilities is a direct result of growth achieved by introducing BSB Direct Finance a direct funding option for brokers, in addition to our traditional syndication programs.
“For 20 years known primarily as a ‘Super Broker’ added a direct funding program in early 2003 that offered an application only product up to $50,000, “he explained.
After the initial success of this product, in April, 2004 BSB Leasing decided to expand its direct funding offerings to include a “risk adjusted” credit philosophy designed to approve a broader spectrum of credits.
BSB is now approving application only transactions up to $50,000 and transactions up to $100,000 for a single lessee for credits that fall into an A, B and C category with rates designed to match the quality of the credit.
“We’re able to handle a wide variety of credits and transactions," Myerson said.
Additional changes at BSB Leasing, Inc. include long time Vice-President of Broker Services, Bruce Zwillinger moving into a new role as head of the Commercial Group handling commercial transactions from $50,000 to $1,000,000.
Skip Wehner, formerly Vice-President of Administration at Granite Financial before joining BSB in December, 2002 as Vice-President of Business Development takes over all sales responsibility for our broker network.
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Lou Altobelli, Jr joins CIT Vendor Finance healthcare equipment financing group in Illinois. "He will focus on originating vendor financing programs and assisting manufacturers and resellers of healthcare equipment in financing programs for their clients. Altobelli previously worked for U.S. Bank Equipment Finance, where he served as vice president of Business Development for the Vendor Finance Group. Prior to the Business Development role, he was national sales manager. He also worked at GE Healthcare Financial Services as manager of Strategic Alliances for GE Ultrasound and at American Express Business Finance as vice president of Sales for Healthcare Finance." Northern Illinois University BS Mgmt, Management (1978 – 1980) Activities and Societies: Delta Upsilon Fraternity
Doreen Cropp joins CIT Vendor Finance healthcare equipment financing group in Illinois. "She will focus on originating vendor financing programs and assisting manufacturers and resellers of healthcare equipment in financing programs for their clients. She previously worked for U.S. Bank Equipment Finance, where she was vice president of Business Development for Healthcare and Technology." Prior she was vice president USBEF/US Bancorp Oliver-Allen Technology Leasing (2007-2008), vice-president, Citigroup (2003-2007), vice president HPSC (GE) (@001-2003), president, Centaur Financial Services (1992-2001), district manager, AT&T Eaton Financial (1990-1993), Vice-President, Capital Lease (1991-1992), regional sales manager, Lease First, (1988-1990).Security Pacific National Bank Officer Program Graduate, Banking - Finance (1977 – 1988) Activities and Societies: Security Pacific National Bank, Officer Candidate Program (1985 - 1986) Worked in over 30 branch offices learning all aspects of banking operations, Assistant Manger/Operations Officer (1986 - 1987) Supervised tellers, note department, ans statements department, Assistant Manager/Accounts and Loan Representatives (1987 - 1988) Sold commercial loans, real estate and consumer loans.
John Gundersen joins Marlin Business Services commercial equipment National Accounts Finance Group as "Business Development Manager within the National Accounts Finance Group, providing additional expertise to Marlin's leadership position in the telecommunications industry." Previously he was regional channel manager, TAMCO (January, 2010; director sales operations, January, 2008, manger inside sales, January, 2007, partner development manager, February, 2004), business development management, Nextira One (2000-2004), sales manager, Williams Communications (1997-2000), sales manager, Williams (1997-2000), account representative, Bell Atlantic Meridia Systems (1992-1995).University of St. Thomas (TX) MBA, Finance (1983 – 1986) Clarion University of Pennsylvania BS, Accounting/Marketing (1978 – 1982). http://www.linkedin.com/pub/john-gundersen/0/a8a/459
John Pack joins CIT Vendor Finance healthcare equipment financing group in Philadelphia. "He will focus on originating vendor financing programs and assisting manufacturers and resellers of healthcare equipment in financing programs for their clients. Pack was with Key Equipment Finance, where he served as VP of Business Development for its Global Healthcare Vendor Services division. Prior to this role he was at USXL/EverBank as director of Relationship Management and Business Development." BS, Finance (1976 – 1980) Activities and Societies: Baseball Team - 4 years
Nella Schwarz joins Ecologic Vendor Services as Director, Sales and Business Development, Vendor Programs-Latin America. Previously she was strategic accounts sales director, Avaya Financial services/CIT Group (August, 1996-January, 2012), sales and marketing director, Mexico City, GE Capital (August, 1984-July, 1995). Universidad de Lima BA
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1. Generally, throughout the United States, late fees are an issue of contract law. If the contract is valid, then the amount of the late fees will be upheld.
2. Many lessees argue that the amount of the late fees is unfair, or "unconscionable." Decisions are all over the map on this issue. Suffice to say that I have yet to find a case which says that the typical late fee charge 5-10% of the actual late payment is unconscionable. On larger deals, we try to get an opinion of debtor's counsel and there is a plethora of law that if the borrower has advice of counsel, there can be no unconscionability claim. Two of the cases are Adams v. Adams, 603 S.E.2d 273 (Ga. 2004); Roussalis v. Wyoming Medical Center, Inc., 4 P.3d 209 (Wyo.2000).
3. One Supreme Court case holds that late charges are just another form of interest (this would be applicable only to a lease intended as security) and that if the lender is exempt from usury (National Bank or licensed lender), then any late charge is enforceable. So, in California on a lease intended as security, if the lender is licensed, it would appear that any interest rate should fly. In other states where no commercial contract is subject to usury, then any rate should also be fine.
4. There are a couple of cases out there, most notably Garcia v. Canan 851 F.Supp. 327 (ND Ill. 1994) holding that a 10% late charge on the whole of the delinquent payments (as opposed to a one time assessment against a single discreet late payment) is a penalty.
Another case I've run into is Leasing Services v. Eastern Equipment 11 B.R. 732 (SD WVa. 1981), an awful case which hold that in bankruptcy the court can strip a lease intended as security down to its components, impute a hypothetical interest figure, back off unearned interest, and back off late charges which are accrued to the overall balance as opposed to a one time assessment of a single discreet late payment.
The bottom line to this issue, is that while the lease or contract can say whatever you want for late charges, and it may be enforceable, I would not feel comfortable with an amount over 10% of the actual late payment, and I would not want to aggregate the late charges, e.g., 10% of the whole delinquent balance, which is essentially interest on interest.
In addition, if the lease is a loan (lease intended as security) there are very adverse consequences in bankruptcy, with the court having the authority to back off unearned interest and late charges.
If any of your readers have any questions, or want additional citations (this issue was litigated in a New Jersey Bankruptcy matter), please have them email me directly: email@example.com
Visit our Web Site at www.bkolaw.com
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Best Performing Credit Unions
Giving both community and regional banks competition, credit unions have been growing in granting both consumer loans and business loans, as well as several are in the direct equipment leasing marketplace, and a few accept local lease brokers.
In a state breakout, Texas accounts for the most institutions placing in the top 50 best performing credit unions with eight:
The chart of the top 50 best performing credit unions was compiled by SNL Financial with the metrics used: ROAA, net charge-offs to average loans, operating expenses as a percent of operating revenue, delinquent loans as a percent of total loans, market growth and net interest margin as a percent of average assets.
Top spot belongs to Melrose Credit Union. "The institution, which consists of its one location in the heart of Queens, is led by Treasurer and CEO Alan Kaufman, who was preceded at the post by his father and whose grandfather helped establish Melrose in 1922," SNL reports, likening it to a successful run family business. "The company has grown its loan book year over year in every year going back to 1995, the earliest year for which SNL has data, and it has experienced positive net worth growth each year over the same period. For the 12-month period ended March 31, Melrose demonstrated 15.6% loan growth compared to 2.1% in aggregate for all U.S. credit unions."
Sounding is a father's journey from loss to grief and to healing. Leah Ellen Marks passed away too young, at the age of 17, as a result of a car accident caused by an impaired driver. By exploring the emotions brought to the surface after her death, Barry Marks shares with readers how he survived the experience with sadness, anger, humor, and spirituality.
“The pages of Sounding are accessible to anyone who has lost a loved one. These poems are not one-sided odes to his lost daughter; they are insightful and inspiring lyrics for the living who have survived tragedy.”
The book is sold out at Amazon at this time, but available direct from the publisher for $15.95
Possible Crocodiles, Book of the Year for 2010 (Alabama Poetry Society) is available at Amazon.
Amazon: About the Author
Leasing News in 2009 named Barry Marks one of the 25 top influential Industry Contributors:
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Highest Paid/Lowest Paid US Bank CEO's in 2011
By Kiah Lau Haslett and Fatima Afzaal and Sabri Sisman
Bank CEO compensation packages may look as hefty as in years past, but there are more strings binding pay to performance and restricting or deferring monetary rewards for years at a time.
Banks are increasingly shifting toward nonequity incentive plan compensation and outlining strategic and performance goals a CEO must fulfill. Shareholder scrutiny throughout a prolonged challenged earnings environment has caused pay beyond base salary to be rerouted into company stock that must vest, and many companies are eliminating wholly discretionary cash bonuses.
JPMorgan Chase & Co.'s Jamie Dimon topped SNL's list of highest-paid CEOs for all asset sizes, earning $23.1 million in salary, bonus, stock and option awards, pension, and perks for 2011, up 11% from 2010, according to SNL data gathered from 2012 proxy forms. JPMorgan is the largest bank in the U.S. by total assets. Wells Fargo & Co.'s John Stumpf came in second with $19.8 million; his $2.8 million base salary was larger than Dimon's $1.4 million, but Dimon's $17 million in stock and option awards dwarfed Stumpf's $12 million. Richard Fairbank, CEO of Capital One Financial Corp., came in third with $18.7 million in pay, $18.5 million of which was stock and options award with no recorded base salary.
"Generally, in pay levels for executives, salaries are up modestly," said George Paulin, chairman and CEO of compensation consultants Frederic W. Cook & Co. Paulin has worked with the boards of super-regional and national banks.
But compensation plans are becoming less discretionary for CEOs and other senior executives, he said. Companies are increasingly awarding stock options with longer vesting periods, in lieu of cash bonuses, and those bonuses are calculated with formulaic incentive plans that emphasize strategic and financial goals. These bonuses, often denoted as long-term incentive plans, have three-year payout periods or other mandatory deferred holding periods, and a portion is usually placed into company stock. So even though pay may seem outsized, falling share prices can wipe out millions of dollars of net worth; failure for stock to appreciate means CEOs can experience greater losses from stock that outweigh other pay.
"With performance-based long-term incentive plan, the onus is on management and the board compensation committees to set goals that make sense in terms of linking paid delivery to performance, and that's a tough job," said Paulin. "There's much more accountability through the say-on-pay advisory voting. They're very concerned with that."
While say-on-pay votes are nonbinding, companies wish to avoid the black eye associated with shareholder discontent. Instead, boards engage in a dialogue with shareholders about what they do and do not like about compensation. Additionally, when "that battle line happens" and shareholders voice dissatisfaction over compensation, "a lot of management teams and compensation committees realize they haven't been clear enough in their proxies [about] the connection between pay and performance," said Peter Miterko, managing director at Pearl Meyer & Partners, a compensation firm that had done work and research in the banking space.
Regulators and shareholders have effectively pressured banks to design pay packages that deter excessive risk-taking. These changes and practices trickled their way from the largest banks to comparatively smaller banks — anywhere between $10 billion and $500 billion — this proxy season, Miterko said. These banks could be "reading the handwriting on the wall" to establish practices ahead of possible regulator requirement, if they have not already been individually required.
PNC Financial Services Group Inc.'s James Rohr received $6.8 million in incentive compensation in 2011, according to the company's proxy. Of that, $2 million was awarded in cash and $4.8 million was an equity-based long term award. The proxy said at least 50% of executive compensation should be tied to equity, deferred over multiple years and subject to additional performance hurdles and adjustments for risk management; Rohr's was 60%. The proxy also notes 2011 pay represented a reduction in performance from 2010's compensation. SNL's tally of his compensation includes perks and other compensation and a nonqualified pension, and at $16.6 million, Rohr had the third-highest compensation of CEOs at banks with assets of between $10 billion and $500 billion.
At Synovus Financial Corp., executives received no bonuses in 2011 for the fifth consecutive year, according to the company proxy. CEO Kessel Stelling Jr.'s compensation was $1.5 million, with a base salary of $875,000 and no bonus or nonequity incentive compensation, according to SNL data. The proxy notes executive compensation is below peers. The long-term incentive program is paid entirely with equity, and the bank's declining stock price means outstanding options are underwater and outstanding restricted stock units have declined in value. Synovus had the third-lowest CEO compensation of banks with between $10 billion and $500 billion in assets, according to SNL data.
Banks $10 billion in assets and below have also changed pay practices to appease shareholders, said Mike Point, a senior vice president at Blanchard Consulting, a consulting firm that works with banks below $10 billion. Companies are using stock options less and emphasizing restricted stock and stock units. He said the move was because options took on the appearance of being awards worth more than the value those individuals brought to the company, at least from shareholders' perspectives, while restricted stock was not as dilutive to shareholders while still imparting equity commensurate with executives' contribution. He pointed out compensation varies across the board with banks of assets less than $10 billion, not only because of asset size but location and lines of business.
Compensation for Roger Taylor, CEO of $6.59 billion Capital Bank Financial Corp., was $13.8 million in 2011. His pay tops the $3.4 million paid to Gerard Host, CEO of $9.73 billion Jackson, Miss.-based Trustmark Corp. Capital Bank is in the process of an initial stock offering, and $12.5 million of Taylor's pay was in stock and option awards.
On the other end was Santa Barbara, Calif.-based Pacific Capital Bancorp, a formerly troubled bank that is now the target of an acquisition with Union Bank NA, a subsidiary of Mitsubishi UFJ Financial Group Inc. Since the company's recapitalization Aug. 31, 2010, CEO Carl Webb elected to receive no pay — salary or incentive-based compensation — and instead receives compensation from GJF Financial Management through a management fee arrangement with Ford Financial Fund LP, where he is a senior principal. Ford Financial is the parent company of SB Acquisition Co. LLC, according to a company proxy.
The Secret of Our Success
"Tony Golobic of GreatAmerica Leasing Corp. is the leader of a very successful company that has kept a relatively low profile. GreatAmerica has had an exceptional record of growth. In 2009 they reached $1 billion in assets, and in the 2009 Monitor 100 survey they reported 2008 origination volume of $430.9 million, a tremendous volume for an independent small ticket vendor leasing company. They were one of the few leasing companies that was able to tap the securitization market in 2009. The company has always been very conservative in its credit approvals, financing and accounting, areas that have derailed a number of their competitors."
This is a new series to highlight companies who have been successful, why, and their recommendations to you.
It has been 38 years since I came across my first equipment finance transaction. Since then our industry has been good to me. Although much has changed during these years, the industry today remains vibrant and a good place to grow one’s career. Not only has our industry grown significantly, but it became much more complex. At the same time, it seems, much of the industry became commoditized. I never wanted to be a part of a commoditized business; there just doesn’t seem to be much value and staying power in a business based on lowest rates and easiest credit. Anyone can do that. I also don’t think one can build lasting market leadership based on lowest pricing and easiest credit; there is always going to be another fool willing to push rates even lower.
I wanted to be a part of a company that would build a lasting market leadership by aspiring to standards of excellence so high in everything it does it would have no competition. This was our vision 17 years ago when we started GreatAmerica Leasing Corporation and this remains our vision today. This was not only our vision, but it was also our reason for starting GreatAmerica. Every day, we make another step on our quest for excellence. Like perfection, excellence is a continuous process, a worthy goal to aspire to and a vision that fills one with pride. I am so thankful that today we have 314 “GreatAmericans” who share our pride.
This vision required a structure that would maximize human potential; one that would continuously engage each and every member of our GreatAmerica team no matter how large we become. Our strong belief in the potential of people provided the philosophical backdrop for an evolution that was to come. At GreatAmerica, we don’t have managers and we don’t have executives. We have leaders. Every “GreatAmerican” is responsible for managing herself or himself. At GreatAmerica, I am not the only one losing sleep thinking, worrying and dreaming of GreatAmerica; there are 313 other “GreatAmericans” who also are thinking, worrying and dreaming of GreatAmerica.
To this end, we transformed our organization into a team-based structure. Our organization chart looks a little different than most; it has our customers (dealers and smaller lessors) at its center, like a sun, surrounded and orbited by our teams, which in turn are supported by our senior leadership. We drew this organizational chart to constantly remind us of who makes us successful; our customers. The idea was to establish teams of cross-trained individuals with intimate knowledge of their customers, and these teams would be responsive to their myriad needs.
The scalability of the team structure also preserved the intimate, small-company feel as GreatAmerica expanded. Teams of empowered individuals rising to their potential and making informed decisions continue to benefit our customers today. Everyone at GreatAmerica participates in a bonus structure that integrates personal and company goals to help grow GreatAmerica and reward individual accomplishments. Our people have a great degree of autonomy in creating their own personal fulfillment. This, in turn, fuels our high retention rates and internal satisfaction levels which translate directly into a positive and consistent customer relationship building. We want our customers to say “wow” when they get off the phone with us. We call this the GreatAmerica Experience.
We also define our customer a little differently than most financing companies. We resolved that the equipment dealers/leasing brokers are our customers and that the lessee is the customer of the dealer/broker. The dealer/broker, our customer, puts food on our family tables. This foundation guides our prospecting and marketing efforts and has engendered great trust with our customers. Not all equipment dealers, just like not all leasing brokers, are the right customers for us. We want just the best ones; the ones who have long-term vision, who want to build strong and lasting relationships with their customers and with us. We used to work with a large number of brokers, but 80% of our business was done with just a handful. That didn’t work well and we pared the number down. We will continue to focus on this process with the goal of doing an increased amount of business with a smaller number of brokers. It’s a matter of finding the right brokers with the right vendor programs with whom we can develop strong and lasting relationships. It may sound strange but our goal is to have fewer brokers for whom we do a lot more.
Our ethical focus has underscored our direction as a whole, ranging from the definition of our customer (above) to the creation of our Truth in Leasing Statement, which is a document we give our customers to give to their customers. It’s an industry-first statement that is essentially a leasing bill of rights for the lessee and outlines what they can expect when they enter into a standard agreement with GreatAmerica. It also draws a line in the sand by capping residual positions and stating there would be no hidden fee tactics common in many leases.
This “no surprises” approach and our financial performance have also formed trusting and valued relationships with our financial providers. We run an open operation and are well attuned to the transparency standards the asset-backed securities market expects. Since 1995 we’ve had nine successful term securitizations of over $2.2 billion in total (the last one, for $454 million, closed in November 2009). In these days of restricted credit, we have record amounts of open credit lines. Our ample access to the capital markets is the reward for our disciplined, common sense approach to credit approval process. Steady and loyal support from our financial partners has also helped us deliver a level of consistency and service very hard to find elsewhere.
The relentless pursuit of our vision to reach the standards of excellence so high in everything we do that we have no competition has enabled us to grow to an asset size of over $1 Billion. We have never stopped growing, not even in the past two years. We now are looking forward to the day, not far away, when we will reach $2 Billion. We will do that by getting better every day and by truly helping our customers become more successful. Each time a customer hangs up the phone with one of our team members, we want them to think: “Wow, it was a great day - the day I started doing business with GreatAmerica!”
Open Positions at Leasing Funders/Various Locations
(Most of the listing have "open positions." While you may find ones that do not, check back later, as they may have added an opening.)
Bank of America
Bank of Ozarks
Bank of the West
CIT Job Openings
De Lage Landen Financial
Home Savings Bank
Northern California Farm Credit (office listings)
People's United Bank
Prime Alliance Bank
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Flat-Coated Retriever/Newfoundland Mix
"I am already spayed, purebred, good with kids, good with dogs, and good with cats."
Rescue Group: Colorado Animal Welfare League
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