Wednesday, October 19, 2011
Spending outlook more sober this holiday season
######## surrounding the article denotes it is a “press release”
and was not written by Leasing News nor information verified, but from the source noted. When an article is signed by the writer, it is considered a “by line.” It reflects the opinion and research of the writer. It is considered “bias” as it is the writer’s viewpoint.
Phil Dushey Visits Protestors in New York City
"My office is about three blocks from the park where they are protesting. Last week I walked over to the park to see what was going on. I felt that I went back in time to the days of Woodstock and the hippie years.
“I spoke to about ten people and asked why they are protesting and nobody could give me a straight answer. The common response was "CORPORATE GREED" and "POWER TO THE PEOPLE" Nobody seemed to want a job and most of them seemed like they have not worked in a long and by choice."
"I think the problem with this protest is there are no requests. If they had a proper platform then I could agree or not.
“I must say it was a good party with a lot of music. It seems to be growing a lot and more and more people are getting on the bandwagon including political people but the bottom line is "WHAT DO THEY WANT TO ACCOMPLISH?"
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There has been some serious trading of stock by officers of Marlin Business Services, especially President, CEO, Treasurer Daniel P. Dyer and George D Pelose, Executive Vice President, Chief Operating Officer, General Counsel & Secretary. The other party is Lynne C. Wilson, Senior Vice President & Chief Financial Officer.
Does not include these recent SEC notices:
There is a Comtex Smarted copyrighted story about how over-valued the stock is (rating at 28X earnings, despite having no promising business model other than auto renewal. The story says It says that of all the so-called "Specialty Finance" companies (non-banks that lend to a niche, like Marlin) -- of which there are many in the U.S.) Marlin has the 3rd lowest Earnings Yield, which is a bad distinction indeed. It suggests that the stock is substantially over-valued.
At the time the article was written, Marlin Business Services Corp. has a market cap of $144.7 million; its shares were traded at around $11.28 with a P/E ratio of 28.2 and P/S ratio of 2.2.
While based in New Jersey, Marlin Business Services does it business out of Pennsylvania to avoid the New Jersey usury limits as well as the Pennsylvania legislature introduced an Evergreen bill and got it passed. The Marlin documentation office is located in Philadelphia.
The following information comes from Marlin Business Service SEC filings:
"Renewal income, net of depreciation, totaled approximately $7.7 million, $7.2 million and $7.0 million for the years ended December 31, 2010, 2009 and 2008, respectively.” (5)
"Fee income included approximately $1.1 million and $1.3 million of net residual income for the three-month periods ended June 30, 2011 and June 30, 2010, respectively. Fee income included approximately $2.3 million and $2.7 million of net residual income for the six-month periods ended June 30, 2011 and June 30, 2010, respectively. Net residual income includes income from lease renewals and gains and losses on the realization of residual values of leased equipment disposed at the end of term as further described below.
Our leases generally include renewal provisions and many leases continue beyond their initial contractual term. Based on the Company’s experience, the amount of ultimate realization of the residual value tends to relate more to the customer’s election at the end of the lease term to enter into a renewal period, purchase the leased equipment or return the leased equipment than it does to the equipment type. We consider renewal income a component of residual performance." (5)
Should Pennsylvania adopt that the lessor so notify the lessee prior to the expiration of the lease the residual terms, Marlin's profitability will certainly change.
Note Equipment Category from December 31, 2010 Year-end as to nature of automatic renewals:
Companies Who Do Not Notify Lessee regarding termination
ACC Capital, Midvale, Utah
ACC Capital, Midvale, Utah---This company is no longer in business, although its portfolio is being wound down, according to its owner Loni Lowder; the receivables are being collected by creditors. Lowder today is an employee, manager, Stalwart Contract Finance, Salt Lake City, Utah. To date, all Evergreen Clause complaints have been satisfied.
Financial Pacific Leasing, Federal Way, Washington---The company itself states they notify lessee, but does not have that policy for their discounters. They also fund leasing companies on the Leasing News Bulletin Board, notably Benchmark Financial Group, as well as others who also appear on the Complaint Bulletin Board, and decidedly then support these companies and their behavior.
This is their policy on Evergreen Clauses:
Paul Menzel, CLP, President.
A recent example occurred in not helping a lessee. Since then, the company who was enforcing the Evergreen Clause, resolved the complaint, changes its policy and has put in place notifying the lessees 30 days in advance of the expiration of the lease.
IFC Credit, Morton Grove, Illinois---This company is in bankruptcy, appeared many times in the Leasing News Bulletin Board prior to filing bankruptcy, but engaged in Evergreen Clauses, and unfortunately a recent example is a complaint to the trustee, stemming from M&T Bank lease assignment expiring and notify the lessee that they did not notify about the residual, which was a $1.00. This has happened many times with other banks who have taken over the IFC Credit Corporation portfolio. Calls and letters to the trustee and attorneys have gone unanswered.
Jules and Associates, Los Angeles, California--- Jules and Associates, Los Angeles, California---A repeat customer, who notified Jules and Associates on a lease, but was not before the 180 day expiration, so Jules and Associates instead of the 1% due for the residual ($2,308.79) charged six more payments or $40,463.94, and if 1% is not paid in this time, they will be subject to another three months.
LEAF Financial Group, Philadelphia, Pennsylvania---It appears this company is in a more wind down phase, moving its operation of LEAF Commercial Credit with basically the same management. There have been complaints about the Evergreen Clause, including a recent one for an Equipment Finance Agreement!
Marlin Business Services, Mount Laurel, New Jersey---The actual SEC filings state the profit earned from Evergreen Clause, primarily from copier leases. Complaints have been received about this practice in addition to the SEC financial statement filings.
Leasing News has contacted over 50 leasing companies, several more than five times, who have not responded with their policy regarding notification to lessees. The practice of imposing extra payments may be more widespread than the companies named above.
"Complaints" Bulletin Board
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NAELB Conference had 80 Attend, but more brokers
The annual Eastern Regional Meeting of the National Association of Equipment Leasing Brokers (NAELB) held in Atlanta, Georgia last Friday and Saturday drew one less than the previous year, but 40 brokers compared to 32 the in the 2010 Atlanta Conference. The exhibitors saw more activity at their booths this year due to the higher broker attendance.
Though the Association membership is down by nearly half from its peak of 1,089 members in 2008, Bud Callahan in his President’s address noted that the average years in business among the members has increased as veterans continue while recent industry entrants have fallen by the wayside. He made it a point to thank the long-time funders and suppliers that have consistently supported brokers and the NAELB and noted the few newly constituted funders that have recently re-emerged.
The attendee list included the core members of the last 21 years with many of the former presidents in attendance. As is its norm, the NAELB continues to attract new entrants to the industry seeking the information, education, contacts, and encouragement they need from the presentations, funders exhibits, and networking.
The general mood of the conference seemed to be guarded optimism. The consensus was that this recession, while the worst the broker industry has experienced, has reached its low point and that a long, slow improvement is underway. Most broker/lessors reported seeing increases in vendor interest and the volume of applications. Several funding sources pointed out that their submissions seemed to be clearly good or clearly bad with fewer gray area credits than historically. A number of veteran brokers voiced the opinion that they did not believe the broker leasing industry would return to the great prosperity of the old days “during their lifetimes” but that making a reasonable living in 2012-13 now looked possible.
The annual Western Regional Meeting of the NAELB will be 11-12 November in Costa Mesa, CA.
**** Announcement **************************************
MESA IS SUSPENDING LEASE FUNDING:
Mesa Leasing, San Diego, California is suspending general lease funding on October 31, 2011. Mesa will continue to operate (collect and service its $4mm lease portfolio) at its existing location. Mesa’s decision to suspend its lease originations was made because its principle investor has suspended funding because of concerns about the economy.
Mesa will review the situation in 2012. If you have any questions please feel free to give Jeff Macdonald or Dave Watt a call at 858-541-1002.
***** Announcement *************************************
Mesa rejoined the "Story Credit" list June, 2011 announcing they would be doing deals in Arizona, California, Idaho, Oregon, Nevada, Utah, and Washington. They had previously rejoined July 28, 2010 to do "story credit" in California only. Jeff Macdonald said he had again connected with his investors, and secured ability for transactions in California. Jeff started the company in 1999 and hopefully will become active again with new investors. Dave Watt is chairman, Mellanie Martin, broker contact, and Chelsea MacDonald is documentation/customer service, according to their web site: http://www.mesaleasing.com/contact.html
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Leasing Companies Out of Business
Companies with an * are no longer in business. The others are companies that were taking broker business, but announced that they no longer are accepting broker business. Many have also down-sized or are managing an existing portfolio.
More details are available in this list by company name:
*ABCO Leasing Inc.,Bothell, WA
(Note: Should a company policy have changed, please contact email@example.com)
Funders looking for new Brokers:
"Broker/Lessor" looking for broker business:
NAELB Broker Exchange
C. and A. Courier Inspection Services
Joins Site Inspection List
Covers Baltimore Maryland and Surrounding Counties
Full Site Inspection List:
Sawbux joins Classified Marketing List
SAWBUX: a different kind of marketing firm. Built by deal guys for deal guys, we drive sales and create winning brands. Contact: firstname.lastname@example.org
M&I Equipment Finance Now BMO Harris Equipment Finance
When Bank of Montréal, the fourth largest bank in Canada, purchased M&I Bank, Milwaukee, Wisconsin, they changed the name of the US Bank to BMO Harris Bank. By acquiring M&I, Toronto-based Bank of Montreal, the fourth largest bank in Canada, will more than double its presence in the U.S. from 321 branches to 700. Yesterday they announced the name change of M&I Equipment Finance Company, which will now be known as BMO Harris Equipment Finance Company.
M&I Equipment Finance Company was a subsidiary of M&I Marshall & Ilsley Bank. On July 5, 2011, at the time of the merger of M&I Marshall & Ilsley Bank into Harris N.A., Harris N.A. changed its name to BMO Harris Bank N.A.
Based in Chicago, BMO Harris Bank N.A. has approximately 700 branches and approximately 1,350 ATMs in Illinois, Wisconsin, Indiana, Kansas, Missouri, Minnesota, Nevada, Arizona and Florida. Member FDIC. BMO Harris Equipment Finance Company is a subsidiary of BMO Harris Bank, which is part of BMO Financial Group, a North American financial organization with 1,600 branches, and a retail deposit base of approximately $180 billion.
### Press Release ############################
CIT Launches Online Bank
BankOnCIT.com to Offer Certificates of Deposit (CDs) with Competitive Rates
Enhances CIT’s Flexibility and Diversifies Sources of Funds to Support Financing
NEW YORK & SALT LAKE CITY--CIT Group Inc. (NYSE: CIT), a leading provider of financing to small businesses and middle market companies, announced the launch of its online FDIC-insured consumer bank, CIT Bank (BankOnCIT.com).
“The launch of CIT Bank online is another important step in our efforts to diversify our funding sources into stable, low-cost deposit products,” said John A. Thain, Chairman and Chief Executive Officer. “The online bank will help us meet the financing needs of our small business and middle market clients. The CIT Bank platform will allow us to expand our client base as we offer additional retail and commercial deposit products in the future.”
CIT Bank’s initial consumer deposit product offerings include a range of certificates of deposit (CDs) that offer competitive rates, depending on the product type, and are designed to help consumers meet their savings goals. The Bank CDs will have no account opening or monthly maintenance fees. CD options include:
CIT Bank’s suite of products and services are expected to expand throughout 2012 and may include: checking, savings, online bill pay, mobile banking and other features.
Raymond J. Quinlan, Executive Vice President, Banking, said, “CIT Bank is inviting U.S. consumers to put our experience to work for them. We are bringing the same qualities that have helped us build small and middle market businesses -- ingenuity, commitment and focus -- to consumers, and we look forward to helping them achieve their personal savings goals."
CIT Bank is a member of the Federal Deposit Insurance Corporation (FDIC) and deposits are insured up to $250,000 per depositor.
Individuals interested in receiving future updates on CIT via e-mail can register at http://newsalerts.cit.com
About CIT Bank
NXT Capital Launches Venture Finance Business
Chicago, Illinois – NXT Capital announced the launch of NXT Capital Venture Finance. This new business will be led by Jan Haas, former President and CEO of Velocity Financial Group and a 15-year industry veteran, who will be joined at NXT Capital by the entire Velocity Financial Group team.
The launch of Venture Finance is another important step in NXT Capital’s development as a diversified commercial finance company. NXT Capital Venture Finance complements NXT Capital’s Corporate Finance and Real Estate Finance groups, extending NXT’s reach to emerging growth companies backed by venture capital and private equity firms, particularly those in the technology and life science sectors. NXT Capital Venture Finance provides senior and subordinated term loans in the $1 million to $20 million range to these companies.
“We’re excited to be joined by Jan and his colleagues in launching NXT Capital Venture Finance and are confident the team’s extensive domain expertise, impressive track record, consistent commitment to the entrepreneurial community and past experience building de novo businesses will be vital ingredients in the success of this initiative,” said Robert Radway, Chairman and CEO of NXT Capital. “Venture finance is a business we are very familiar with and one that represents a logical, attractive expansion of the NXT platform.”
Founded in 2007, Velocity Financial Group provided alternative capital to a wide range of growth stage companies. Velocity has invested in more than 30 venture and private equity-backed technology, life sciences and clean energy companies. Its portfolio includes such notable industry leaders as Cadent, Schoolnet, Seven and Suniva.
“Joining forces with NXT Capital makes perfect sense for our clients and the team,” said Haas. “With NXT’s substantial and stable capital base, familiarity with venture finance and a quick and reliable decision making process, we are confident our team will quickly establish NXT Capital Venture Finance as a market leader and the preferred source of financing for our clients.”
NXT Capital provides structured financing solutions to middle-market and emerging growth companies, and real estate investors through its Corporate Finance, Real Estate Finance and Venture Finance groups. Based in Chicago with offices in New York, Atlanta, Boston, Dallas, Newport Beach and Silicon Valley, NXT Capital targets senior financing opportunities of up to $150 million with a hold size up to $30 million
Pest Control Owner gets One Year, $175,000 fine, May Lose License
Los Angeles – Appearing before United States District Judge Gary A. Feess, an Inglewood business operator was sentenced today to 12 months and one day in federal prison for underreporting his business income.
Frank Marshall, 66, of Los Angeles, operator of Stormies Pest Control, was further ordered to pay restitution of $175,000 to the Internal Revenue Service and to spend one year on supervised release after serving his prison sentence. In light of the sentence imposed by the court today, Marshall faces the possible loss of his State of California pest control license.
In hearings leading up to today’s sentencing, Judge Feess acknowledged that Marshall failed to report over $2 million in gross receipts from his business during the years 2003 through 2005.
On June 27, 2011, Marshall pleaded guilty to a one-count information charging him with subscribing to a false 2004 tax return. Marshall’s 2004 tax return reported business income of $87,824 on the attached Schedule C. In 2004 Stormies received substantially more income than what was reported on the tax return.
According to documents filed with the court, Marshall’s criminal conduct came to light during the course of a routine IRS tax audit.
According to the plea agreement, beginning in 2003 and continuing through 2005, Marshall operated Stormies Pest Control. Marshall controlled the finances of Stormies and was responsible for the deposits of Stormies’ gross receipts.
In addition to the unreported income for the 2004 tax year, Marshall admitted that he engaged in similar conduct for the 2003 and 2005 tax years. The total tax loss to the government for the years 2003, 2004, and 2005 is at least $175,000.
Judge Feess ordered Marshall to surrender to the Bureau of Prisons in 90 days. In issuing today’s sentence, Judge Feess commented that Marshall’s crime was serious and that the general public should know that if you are caught committing a tax crime you face the possibility of being sent to prison
The investigation and prosecution of Marshall was conducted by IRS - Criminal Investigation’s Los Angeles Field Office, in conjunction with the United States Attorney’s Office for the Central District of California.
#### Press Release ############################
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Mount Laurel, New Jersey -- Adopt-a-Dog
Harley is a black female Lab mix with a grey muzzle, medium in size & short. She is looking for a loving home. Her owner is in the hospital & can no longer care for her. Please adopt her!! Look alike picture."
Animal Sanctuary Society, Inc.
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JP Morgan Topples BofA as largest US Bank by Assets
Baltic Leasing celebrates its 21st birthday
Message from bank earnings: Higher fees are here to stay
Gloom Grips Consumers, and It May Be Home Prices
'Dancing' ballroom erupts in boos over latest ouster
Pete Rugolo, award-winning composer and arranger, dies at 95
Spending outlook more sober this holiday season
Al Davis Private Funeral
Al Davis: A Lifetime with the Raiders
NBA Players, Owners meeting with mediator
Detroit Lions coach Jim Schwartz says officials erred in loss to San Francisco 49ers
Hue Jackson on Palmer trade: 'We're chasing a championship'
Palmer trade will have long-lasting impact on Raiders, Bengals
Fry's Electronics to Omar Siddiqui: You still owe us $65 million
San Jose cops let hundreds of bikers leave cemetery crime scene without searches, interviews
Home loan defaults jump by 26 percent in California
Finding Autumn in St.-Joseph--Eric Asimov
Sip a Little Wine Now, Buy a Bottle Later
Cool California weather keeps winemakers waiting
U.S. Wine Auction Prices Down Slightly in Third Quarter 2011
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This Day in History
1739 - England declared war on Spain over borderlines in Florida. The War is known as the War of Jenkins' Ear because a Member of Parliament waved a dried ear and demanded revenge for alleged mistreatment of British sailors. British seaman Robert Jenkins had his ear amputated following a 1731 barroom brawl with a Spanish Customs guard in Havana and saved the ear in his sea chest.
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