Wednesday, July 19, 2006
Headlines--- ICON Fund: Largest Public Equip. Leasing Fund ######## surrounding the article denotes it is a “press release”
------------------------------------------------------------------------------- ICON Fund to Become Largest Public Equipment Leasing Fund
Leasing News is very proud of its former member of the advisory board, Paul Weiss, who is president of ICON Capital. We miss him. He called to personally make sure we had the press release from his company. It was sent on Monday as an “Extra.” http://www.leasingnews.org/archives/July%202006/07-17-06-extra.htm “Paul B. Weiss, 45, has been our President and Director since January 1, 1999. Mr. Weiss was our Director and Executive Vice President responsible for lease acquisitions from November of 1996 until December 31, 1998. Mr. Weiss served as Executive Vice President and co-founder of Griffin Equity Partners, Inc. from October of 1993 through November of 1996. Prior to that, Mr. Weiss was Senior Vice President of Gemini Financial Holdings, Inc. from 1991 to 1993 and Vice President of Pegasus Capital Corporation (an equipment leasing company) from 1988 through 1991. Mr. Weiss has a B.A. in Economics from Connecticut College. Mr. Weiss has been in the equipment leasing business since 1988.” http://www.iconcapital.com/level1/management.html --------------------------------------------------------------- Classified Ads---Credit
St. James Winery, St. James, Missouri *
Atlanta, GA Boston MA Corona, CA Fort Lee NJ Irvine, CA Los Angeles, CA New Jersey, NJ New York, NY Sausalito, CA Orange, CA Senior Credit Officer For a full listing of all “job wanted” ads, please go to: To place a free “job wanted” ad, please go to: --------------------------------------------------------------- 104 degrees in Los Gatos/Saratoga, California It was hot here as perhaps all high temperature records broke in the San Francisco Bay Area. We had the heat spell so far for two days. Yesterday it was 104, but today only 100, but the air conditioner in our office building overloaded and went out. I left earlier to work at home, where it was much cooler. I even went into the pool. Love the warm weather; a chance to go home early, have a cool one, and relax. editor
---------------------------------------------------------------- Bulletin Board Complaint "Evergreen Lease" “Everything I see with regards to this transaction is above board...standard operating procedure." Balboa Capital spokesman
e-mail on May 31st: "In March of 01, my partner and I signed a leasing agreement with Balboa Capital to pay for the purchase and installation of two Capstone Micro-turbine Generators to be installed in our mobile home park. The cost of the turbines, installation, and ancillary equipment was to be $127,627. We subsequently spent another $80,000 of our park income to effect the installation. "We were scammed. Our intention was to use the leasing mechanism to pay for the outright purchase and installation, which is how the lease was sold to us by Balboa. "We made the 48th and last payment in March and two subsequent payments by mistake: a total of 50 payments of $3298 or $164,900. "On May 15, we got a letter from Michele Miller at Balboa: 'The lease is a fair market value lease that allows the lessee to purchase or return the equipment at the end of the term.” “Per the terms of the agreement, the lessee is required to send written notice of intent via certified mail to our corporate office'.” John Byk, partner, Reche Canyon Mobile Estates, a California Partnership Colton, California Balboa Contract, Lease paragraph 3, page 1 : “Each lease may be terminated by lessee at end of the base term if one hundred and twenty (120 days) prior to the end of the base term, written notice of such termination is delivered to lessor (by certified mail). Each lease may be terminated by lessor at the end of the base term if at least 60 days prior to the end of the base term, written notice of such termination is delivered to the lessor by certified mail. Otherwise the term of the lease shall automatically be extended for six months following the initial term at the rent stated in the respective schedule, and shall renew thereafter for successive three month periods until notice of termination is provided by lessee.” Mr. Byk explained they were not counting the lease payments, and made the two "extra" payments in error. He was originally told by the Balboa salesman the purchase option was $1.00. Leasing News asked him to provide copies of the contracts, plus the invoices, and any information he might have to substantiate his complaint. After receiving the documents, there was no purchase option provided, and we explained this was an "Evergreen Lease." The 48 month factor was .0258479. The California use/sales tax was charged monthly, so there was no difference in payment 49 and 50 from the others, nor any notation on the invoice as to the payment number or outstanding balance of the initial contract. In obtaining the two copies of two invoices, the property management person that actually issued the checks, Lewis Lee of LML Property Management Company, said, “The previous 48 payments were sent directly to Wells Fargo Equipment Finance:” http://leasingnews.org/PDF/Balboa_statements.pdf Leasing News explained that "Evergreen Contracts" were not uncommon at Balboa Capital ( see Balboa Capital spokesman comments), that Balboa Capital salesmen were often remunerated for the "Evergreen" clause or "Fair Market Value" or "guaranteed purchase upon terms (PUT)." We thought the only possibility he might have is a case regarding with the Balboa Capital salesman and his presentation, and to discuss it with an attorney; in the meantime, we would see if we could negotiate a compromise on the matter. Leasing News contacted Patrick Byrne, CEO of Balboa Capital on June 2. On June 8th, a "Balboa Capital spokesman" replied by e-mail after receiving the material from Mr. Byrne, stating the salesman involved "... wrote a FMV lease and was paid upfront for a portion of the assumed residual as per our compensation policy. He also might not have mentioned the evergreen aspect of the lease but it is clearly spelled out in the agreement. It is also unfortunate that a disgruntled salesman is pulled into this and his one sided comments reflect adversely on Balboa. "Secondly, our policy is to send a certified, signature required, letter to the lessee 9 months prior to the expiration of the lease asking the lessee to confirm his end of term option in writing as per our agreement...99.9% of the lessees respond to this certified letter and they are reminded of the need to send us notice as per the agreement. This lessee received the letter but did not issue the notice. "We can debate evergreen all day but its existence in the marketplace is fairly standard to some level. You might argue that a 6 month renewal is too harsh but I have looked at some documents that have it for 12 months. CPL (Colonial Pacific Leasing) had it and like Balboa (they) did everything (they) could to make the lessee aware of his need for notification... The point being, it exists in the lease financing marketplace and is more wide spread than you may be aware. "What I am trying to understand with regard to your communication to Pat is what you are asking us to do? Everything I see with regards to this transaction is above board...standard operating procedure." At this time, Mr. Byk had spoken to an attorney, who confirmed that there was no purchase option in the lease, and with the news that the salesman was paid for the "extra payments," it was discussed that Mr. Byk would help sell the unit, and Leasing News would try to resolve the matter and perhaps apply the two payments made to the automatic renewal of six payments, as per the contract. In the course of e-mail, Mr. Byk wrote: "In that the 30KW has been uneconomic and was disconnected more than two years ago and that the 60KW has not been turned on (not operating) for over a year (however, both turbines are operational), and because we have no intention of reactivating them, we are not interested in buying the equipment." During the next few weeks, Leasing News attempted to negotiate, starting off with a four more payment offer, then six months, and nine months, basically our idea and not discussed with Mr. Byk, as the goal was to get some dialogue going. Nothing from Balboa's end. We suggested Mr. Byk may be able to help sell the equipment, so Balboa Capital could re-coop the money they were claiming was due. He was able to get the unit on eBay and demonstrate their value, which the sale would go full to Balboa, as he understood he could not legally sell them. Three management personnel, including Patrick Byrne, were included in the e-mails. June 21, the Balboa spokesman wrote, "To be clear on what our lessee is communicating to you, "He states he is willing to let Balboa keep the two extra payments and the equipment, which he says Balboa can sell via eBay. "He has not declared that to us and not return the assets or made arrangements to return the assets. His message to our portfolio team is quite a bit different. Can you please have him put his intent in writing to us, as we have asked all along, so that I can at least have a clear understanding of his intent?" June 21, Mr. Byk responded by e-mail, including sending overnight: "Dear ****** "If you will acknowledge the following in a letter to me, tell us where you want the equipment listed on the Valley Detroit Diesel invoice date of 02/19/02 to be delivered, and return the two leasing payments we made after the lease expired; we will hire the contractor who installed the equipment to disconnect it for shipping and a shipping company that Capstone Turbine recommend to transport the equipment to you. Last Friday, I called our contractor who will go to the Park to price the job for us. "Both turbines have been inoperative for several years. We turned off the system when the cost of natural gas was so high as to generate a loss. I think that the 30KW unit was replaced by Capstone over two years ago and has had little if any use. "My address is: Jon Byk ****** "Sincerely, Leasing News received this from Balboa Capital: “All communication whether written or verbal regarding this matter as of today, June 21, 2006 at 12:15pm est, is considered to be "Confidential and Off the Record". It is our policy at Balboa to restrict "On the Record" communication to news sources or news reporters unless and until the response has been reviewed and approved by our legal counsel” June 28th the law firm of Darling & Robertson send the following:
Leasing News has attempted since July 5, after receiving the "demand" letter to obtain a "formal statement" from Balboa Capital on the matter. Follow-up was made the next week, noting that Leasing News would be printing the complaint. No response has been made to date. Copy of documents sent by Reche Canyon Mobile Estates (Note there are 21 pages and this may be a long download on your system:) ---------------------------------------------------------------- Evergreen Lease laws
At the beginning to the Balboa Capital complaint, Leasing News began researching not only the laws, but asking readers about the statement made by the Balboa Capital spokesman: “The point being, it exists in the lease financing marketplace and is more wide spread than you may be aware.” Readers told us something quite different about the ethics and their attitude toward the practice: From a prominent California attorney: Rhode Island: section 6-13-14 of the Rhode Island statutes restricts renewal clauses in personal property leases. This is from a major bank senior attorney: "New York's General Obligations Law Section 5-901 prohibits any automatic renewal of a lease for a term greater than one month unless the lessor gives the lessee written notice of the existence of such renewal provision at least 15 days and not more than 30 days prior to the time that the lessee is required to give notice under the lease. Illinois has a similar statute (815 ILC 601 Sec 10). However the Illinois statute does not apply to “business to business” leases, while the New York statute applies to all leases. "Also, I believe that the proposed Utah statute that would have prohibited evergreen clauses was not passed." Coincidently a story of the “end of lease” issue regarding a Utah leasing company appeared in a local newspaper. The first was sent to us by Mark Haycock, Regional Sales Manager, of Zions Credit Corporation, Salt Lake City, Utah ( we also received from others, but Mr. Haycock was the first:) http://leasingnews.org/PDF/desert_news.pdf * Declaration: Christopher Menkin was employed by Andrew G. Deiss of Jones, Waldo, Holbrook & McDonough, Salt Lake City, Utah as an "Expert Witness" in the SOS Staffing in this article and specifically makes no comment. Readers on Evergreen leases:
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---------------------------------------------------------------- NorVergence---FTC Shoe to Follow by Christopher Menkin
Leasing News was not only able to print the latest NorVergence story in full, but also had it early, as writer Martha McKay sent it to us at 7:14am in the morning. We have been helpful to each other since the beginning, when NorVergence employees were not getting paid. We appreciate her thinking of our readers. If you missed the “extra, “because you are not on our mailing list, here it is: http://www.leasingnews.org/archives/July%202006/07-18-06-extra.htm The other shoe will drop soon as the Federal Trade Commission has been active behind the scenes, working on several of the Trustee claims in the bankruptcy court. The FTC also holds two major judgments from the court itself. Here are some highlights of the trustee's recent filing: Date filed: 06/30/2004 (original bankruptcy) (Ironically, she is also the judge on the Allserve case) Trustee Over 150 “lead” attorneys, not counting their staff: http://www.leasingnews.org/Pages/Norv_Attorney_list.doc In the Friday, July 14, 2006 53 page filing by Warren J. Martin, Jr., Special Litigation Counsel to Charles M. Forman, Chapter 78 Trustee of the Estate of NorVergence, Inc., highlights: Some of the individuals named: Thomas N. Salzano ; Data Solutions Ltd. ; Peter Joseph Salzano ; Alexander L Wolf ; Robert Fine ; Robert Wizeman ; William Jean Charles ; Terry Schemer ; Arthur Scuttaro and others with their current residential addresses. The majority of leasing companies named (32): ABB Business Finance Inc
In addition there are over a 100, perhaps even higher, of specific complaints pertaining primarily to transfers or payments to “defendant” (most “90 days prior to petition date”) that the trustee is claiming: Dolphin Capital $59,281 Included in what appear to be the same transfer claim: Spring $4,781,722 A group of other “creditors,” in the $20-$50,000 range, such as Dell, $31,817 except for Staples $97,940.19 and Moritt, Hock, Hanroof & Horowitz, LLP $56,665 There is a group which appears against NorVergence lessees who made payments to banks and leasing companies and refers to “Two-Year Fraudulent Transfers” involving such action as “...contributed $25,0000 to NorVergence in Agreement whereby Defendant...contributed $25,000 in consideration of 100,000 shares of common stock and a promissory note for the benefit of the defendant. These seem to be “investors” who received a return for their stock investment with a note that called for monthly payments, that the Trustee now claims should be “returned.” Here is a short sample: Glenn Toussaint $21,862 It appears they will lose their original investment (stock), as well as payments received on the original note, too. (More on this in another issue: editor.) Here is the “introduction” to the 53 page filing with 58 pages of Exhibits: INTRODUCTION 1. When a "business" is designed, not to earn a profit, but simply to generate cash through the addition of larger and larger numbers of new customers, the "business" will constitute a Ponzi scheme 1 Charles Ponzi established The Security Exchange Company in Boston on December 26, 1919, promising investors 50% interest in 45 days. His alleged business was international postage stamps, which would be converted into U.S. dollars at great profit. Investors lined up and Ponzi made good on his promise, paying 50% interest to investors in 45 days until his house of cards collapsed in August of 1920. It seems that there was no underlying business and that Ponzi was simply paying interest to old investors with new investors' money. As long as the "business" grew exponentially, it worked. But without a constant supply of new customers, it failed. All told, 40,000 people 1044033 5 2. When a "business" is designed to sell goods or services to customers at a loss (because there is no ultimate intention of paying the vendors) the "business" will constitute a "Bust-Out," too. 3. NorVergence, Inc. ("NorVergence" or "Debtor") was a complex and ingenious combination of a Ponzi and a "Bust-Out": it generated cash (not profit) through the exponential expansion of its customer base. But it accomplished that exponential growth by selling its product, telecommunications and internet services, to customers at a great loss. The Insiders, defined below, and particularly Thomas N. Salzano, lived lavishly off the cash flow, until the source of new customers dried up. This scheme shall hereinafter be referred to as the "Salzano Scheme." SUMMARY 4. NorVergence was incorporated in September, 2001, by Peter Salzano ("Peter"), as CEO and major shareholder. The actual mastermind and principal behind NorVergence from the start was Thomas N. Salzano ("Salzano"), Peter's brother. Salzano was never directly employed by NorVergence as anything other than a consultant, although he managed and controlled all of NorVergence's affairs from the start. 5. Salzano had a history of running telecommunication companies with large call center operations into bankruptcy3, as well as a record of regulatory problems with the Federal Communications Commission ("FCC") and various state agencies. 6. As a result, Salzano chose to keep his name out of the public eye in connection with NorVergence's start up, and chose his brother, Peter to serve as NorVergence's front man. entrusted an estimated fifteen million dollars with Ponzi. He and his staff lived lavishly. In truth, there was no business, no profit motive, and no profits (only cash). Ponzi went to jail for fraud. 2 In a "Bust-Out," a business places large orders with vendors on credit, never intending to repay the vendors. The products are sold to customers at cheaper than wholesale (which causes the product to move very quickly). The operator then quickly shuts things down and leaves with the money, without paying the suppliers, of course. See, e.g., United States v. Crocket, 534 F.2d 589, 592 (5th Cir. 1972) . 3 National Telecommunications, Co., Inc. and Minimum Rate Pricing filed for bankruptcy protection on February 26, 1999. On November 3, 1999, Discount Call Rating, Inc. also filed for bankruptcy protection. 1044033 6 7. From September, 2001, until late in 2002, Salzano carefully planned the roll out of the Salzano Scheme. NorVergence would be both the victim and the vehicle through which the Salzano Scheme was perpetrated. NorVergence began operations late in 2002. For a few short months of operations in 2002, NorVergence had gross revenues and lease sales receipts of $19.5 million. 8. In an initial filing with Dunn & Bradstreet in 2001, before operations began, Peter had estimated revenues of $90 million in the first year of operations. In 2003, the first full year of operations, NorVergence had gross revenues and lease sales receipts of $142 million. In the first 6 months of 2004, prior to the June 30, 2004 involuntary petition date filing, it had lease receipts and gross revenues approaching $150 million and anticipated annualized gross revenues and lease sales receipts of $350 million. 9. The problem, as will be shown below, is that very few of these receipts represented true earnings, as opposed to money simply churned from the acquisition of new customers. 10. The Salzano Scheme caused hundreds of millions of dollars to be funneled into.the business, only to be expended on landing new customers, and the lavish lifestyle of Salzano, all to the detriment of NorVergence and NorVergence's customers and creditors. 11. Alexander L. Wolf, Robert Fine, Robert Wizeman, William Jean Charles, Terry Skemer and Arthur Scuttaro (the "Insiders") were all officers and/or directors and/or employees with significant management responsibilities who understood all or a significant part of the Salzano Scheme and nonetheless, breached their fiduciary duties to NorVergence by actively participating in it and by permitting it to continue for almost two years, unabated. 12. In addition to their regular payroll and company credit cards, the Insiders received at least $854,000.00 in additional payments from NorVergence. 1044033 7 13. The cash passing through NorVergence (there were never profits – only cash) supported Salzano's lavish lifestyle, as well as the lifestyles of the Insiders. In this Complaint the Trustee seeks to recover some $2.7 million in known transfers made to Salzano. 14. Finally, the Leasing Companies named in this Complaint were the recipients of fraudulent conveyances and other transfers which, among other things, served to perpetuate the Salzano Scheme. Certain payments made to the Leasing Companies are avoidable as actual intent fraudulent conveyances under 11 U.S.C. § 548 as well as § 544, utilizing state law. The Leasing Companies also knew or should have known about the fraud, and as such, are also liable for aiding and abetting the fraud, aiding and abetting a breach of fiduciary duty, and for the deepening of NorVergence's insolvency. Some of the Leasing Companies may have also improved their position by way of setoff, in the 90 days prior to the bankruptcy, which amounts are recoverable under 11 U.S.C. § 553(b). Here is the full 53 page filing: Exhibit “D” in the 58 pages of exhibits attached was the S.O.S. case reported here in Leasing News concerning IFC Credit Corporation, one of the key exhibits in this presentation. It is noted the findings of the case IFC Credit “...knew that NorVergence customers were not receiving service and therefore were not receiving promised savings” and “ IFC participated in deceiving customers through its confirmation script...IFC grossly over-charged for the Matrix Box...IFC did not act in good faith in connection with the Lease. IFC ratified the conduct of NorVergence (pages 28) Here is the Exhibits attached to the original filing: IFC Credit: ---------------------------------------------------------------- CLP "Good News, Bad News" by Christopher Menkin
I personally always like to save the good news until last. Here is the "bad news, first:" The Certified Leasing Professional foundation is supported by three leasing associations: Eastern Association of Equipment Lessors, National Association of Equipment Brokers, and the United Association of Equipment Leasing. It has been hoped for years by many that when Mike Fleming retired as president of the Equipment Leasing Association (ELA), things might change. Not that ELA did not "appreciate" the CLP Foundation, but they did not promote the concept or designation or hosting an examination at their conferences, participate, or even have two board members on the CLP Foundation as do the other three. In the writing of the "Why I Became a CLP" series, discussion was made with Don Ethier, CAE, Vice-President, Marketing and Communications. In a follow-up, he wrote yesterday in an e-mail: "I have brought your question about the CLP to the attention of Ken Bentsen, ELA's new President, and he agrees with our previous response that it seems to be a good program but it is not ELA's role to evaluate or endorse it." Regards, Don Ethier In other bad news, there are only 168 CLP's today. At the beginning of the year, there were 174; the previous year, 223 active. There are three new CLP's ( already in the count of the 168.) And now the "good news:" the three new CLP's are: Howard Krollfeifer, Jr., CLP Congratulations to them. Leasing News hopes more will be challenged to take the exam and earn the prestigious to their name. "The CLP Foundation is the official governing body for the Certified lease Professional ("CLP") Program. The CLP designation sets the standard for professionalism in the leasing industry. This designation identifies and recognizes individuals within the leasing industry who have demonstrated their competency through continued education, testing and conduct. "We invite you to visit our web site -- www.clpfoundation.org for detailed information about the CLP Foundation and the CLP Program. For further information about our Mentor Program and Anonymous Test Taking Program, please contact Cindy Spurdle at 610/687-0213 or cindy@clpfoundation.org." Cynthia W. Spurdle Leasing News “Why I became a CLP” series:
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Alexa Ranks Leasing Media Web Sites
David G. Mayer's Business Leasing News is not included in the Alexa report list as it does not have its own individual site and Alexa finds Patton Boggs, LLP Attorneys at Law. The rating is not valid as it includes all those who visit and communicate with the law firm. When Business Leasing News has its own individual web site, it will be included in the Alexa survey. These comparisons are compiled by Leasing News using Alexa and should be viewed as a "sampling," rather than an actual count from the website itself. Other than as noted above, we believe the ratings are reflective as most have stayed in the same position, basically, for over a year. The Alexa tool bar works on most browsers. You may download their free tool bar A graph and analysis of the last three months are available. ( Note: the lower the number, the higher you are on the list. It is based on all web sites. Leasing is only a very small part of the various sites such as Yahoo, MSN, Google, etc. )
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-------------------------------------------------------------- FASB seen voting to rewrite lease accounting rules today http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-07-18T205728Z_01_N18430424_RTRIDST_0_ACCOUNTING-LEASES-FASB.XML -------------------------------------------------------------- Retailers seen taking biggest hit from lease accounting http://today.reuters.com/investing/financeArticle.aspx?type=fundsNews2&storyID=2006-07-18T204138Z_01_N18434829_RTRIDST_0_ACCOUNTING-LEASES-FASB -FACTBOX.XML --------------------------------------------------------------- ### Press Release ########################### KeyCorp Reports Second Quarter 2006 Earnings - Second quarter EPS of $0.75, up 7% from the year-ago quarter CLEVELAND, -- KeyCorp announced second quarter net income of $308 million, or $0.75 per diluted common share, compared to $291 million, or $0.70 per share, for the second quarter of 2005. For the first quarter of 2006, net income was $289 million, or $0.70 per diluted common share. Return on average equity was 16.11% for the second quarter of 2006, compared to 16.15% for the same period last year and 15.48% for the first quarter of 2006. For the first six months of 2006, net income was $597 million, or $1.45 per diluted common share, compared to $555 million, or $1.34 per share, for the first six months of 2005. Return on average equity was 15.80%, compared to 15.63% for the first half of 2005. "Key's improved performance in the second quarter was driven by revenue growth and solid asset quality," said Chairman and Chief Executive Officer Henry L. Meyer III. "Relative to last year's second quarter, Key's taxable- equivalent revenue rose by $90 million. This increase was due largely to solid commercial loan growth, higher income from our fee-based businesses and growth in core deposits, which increased 10% from the second quarter of 2005. The growth in fee income was broad-based and included increases in trust and investment services income, investment banking fees, income from operating leases, and net gains from both principal investing and the initial public offering by MasterCard. "With regard to asset quality, both nonperforming loans and net loan charge-offs were down from both the prior and year-ago quarters. For the second quarter of 2006, net loan charge-offs represented 0.21% of Key's average total loans." The company expects earnings to be in the range of $0.70 to $0.74 per share for the third quarter of 2006 and $2.85 to $2.95 per share for the full year. Full press release at: http://www.snl.com/irweblinkx/file.aspx?IID=100334&FID=2580822### Press Release ########################### U.S. Bancorp Reports Record Net Income for the Second Quarter of 2006 MINNEAPOLIS, -- U.S. Bancorp (NYSE:USB): EARNINGS SUMMARY Table 1 ---------------------------------------------------------------------- Percent Percent 2Q 1Q 2Q 2Q06 vs 2Q06 vs YTD YTD Percent 2006 2006 2005 1Q06 2Q05 2006 2005 Change --------------------------------------------------------- Net income $1,201 $1,153 $1,121 4.2 7.1 $2,354 $2,192 7.4 Return on Dividends (a) computed as noninterest expense divided by the sum of net interest income on a taxable-equivalent basis and noninterest income excluding securities gains (losses), net and intangible amortization. U.S. Bancorp (NYSE:USB) reported net income of $1,201 million for the second quarter of 2006, compared with $1,121 million for the second quarter of 2005. Net income of $.66 per diluted common share in the second quarter of 2006 was higher than the same period of 2005 by 10.0 percent, or $.06 per diluted common share. Return on average assets and return on average common equity were 2.27 percent and 24.3 percent, respectively, for the second quarter of 2006, compared with returns of 2.23 percent and 22.7 percent, respectively, for the second quarter of 2005. U.S. Bancorp Chairman and Chief Executive Officer Jerry A. Grundhofer said, "Historically, the second quarter of the year is one of the Company's strongest, and this year was no exception. Our earnings per diluted common share grew by ten percent over the same quarter of 2005 and 4.8 percent over the first quarter of 2006. We achieved industry-leading performance metrics of return on assets of 2.27 percent and return on average common equity of 24.3 percent. We recorded exceptional growth in fee revenue, and that growth, coupled with controlled expenses, led to a tangible efficiency ratio for the quarter of 41.8 percent. Growing revenue faster than expense has always been a goal of this Company, and we did just that this quarter. As a result, we created positive operating leverage on both a year-over-year and linked quarter basis. "The growth in noninterest income was 13.9 percent year-over-year. Our payments and fiduciary businesses were the primary contributors to the increase in fee income, both of which recorded solid organic growth, as well as incremental revenue from recent acquisitions. In addition, consumer banking posted strong increases in deposit service charges year-over-year. "Once again, credit quality was outstanding. These results are the direct benefit of our efforts to reduce the overall risk profile of the Company. Going forward, we will continue to focus on acquiring high quality credits and maintaining our current risk profile. The offset may be slightly lower spread income and loan growth, but the reward should be lower overall credit costs during the next credit cycle. "Total average loans increased year-over-year by 7.3 percent, while total average earning assets rose by 4.6 percent. Despite the increase in average earning assets, net interest income for the quarter was lower than the same period of last year, as our net interest margin declined to 3.68 percent. Competitive pricing and growth in lower-spread assets, given the current interest rate environment, had a significant impact on the margin. Our challenge going forward will be to grow credit products at reasonable spreads that compensate for the risk involved. We can compete effectively in this environment given our powerful fee-based product set and our status as a low-cost producer. "We announced two acquisitions in June. First, we signed a definitive agreement to purchase Vail Banks, Inc., the parent company of WestStar Bank. This acquisition will add 24 new branch locations to our franchise in western Colorado. Second, we announced the purchase of Schneider Payment Services, a division of Schneider National, Inc. These two small acquisitions fit very well into our expansion strategy. The Colorado branches will enhance our distribution in attractive, growing markets, while Schneider Payment Services will expand our current fee-based freight payment offerings and business opportunities. "I am very pleased overall with our second quarter results. These results demonstrate that our Company can produce high-quality earnings for our shareholders by leveraging its balanced business mix, advantaged scale, reduced risk profile, low-cost leadership and dedication to customer service." Full press release at: ### Press Release ########################### U.S. Bancorp Announces Davis to Succeed Grundhofer as CEO in December 2006; MINNEAPOLIS----Implementing an established succession plan, the board of directors of U.S. Bancorp (NYSE:USB) announced today that Richard K. Davis will succeed Jerry A. Grundhofer as president and chief executive officer effective following the U.S. Bancorp board meeting on December 12, 2006. Grundhofer will remain as chairman of the board until December 31, 2007. Davis was elected to the board of directors of U.S. Bancorp effective immediately. Davis, 48, has been president and chief operating officer of U.S. Bancorp since October 2004. Grundhofer, 61, has been chief executive officer since 1993 and chairman of the board since 2002. Davis was vice chairman responsible for consumer and commercial banking from 2003 to 2004, and vice chairman or executive vice president of consumer banking from 1993 to 2003. "U.S. Bancorp has been privileged to have Jerry lead the company as chief executive officer. Starting at Star Bank in 1993, with a market capitalization of approximately $1 billion dollars, to U.S. Bancorp today, with a market capitalization of $55 billion dollars, Jerry's strategic vision and ability to execute have led us to the forefront of the banking industry," said Jerry W. Levin, chairman of the governance committee of the U.S. Bancorp board of directors. "Obviously, I'm proud of U.S. Bancorp and its employees, and all that we have accomplished here," said Grundhofer. "Several years ago, I discussed with the board my desire to retire at age 62 after 40 years in banking. As part of that discussion, we put in place a succession plan that is now being successfully implemented. I'm delighted that Richard Davis is being promoted to CEO, and I am confident he will do an outstanding job. He has been and continues to be instrumental to the success of our company.” Full press release at: ### Press Release ########################### Key Equipment Finance names Kaillen Almond Vice-President, Global Brokerage SUPERIOR, CO, -- Key Equipment Finance, one of the nation's largest bank-held equipment financing companies, has announced that Kaileen Almond has been named vice president, Global Brokerage. In this role, Kay is responsible for managing Key Equipment Finance's brokerage operations across all portfolios on a worldwide basis. Her office is located at Key Equipment Finance's worldwide headquarters outside Boulder, Colorado. “Kay has demonstrated a commitment to continuous improvement within our workplace environment,” said Christopher Queen, senior vice president, Global Asset Management. “She has worked very hard to build our brokerage capability and has increased her scope of responsibility significantly over the last year. This promotion is well-deserved in recognition of her proven track record of success.” Kay joined Key Equipment Finance (then Leasetec Corporation, which was acquired by Key Equipment Finance in 1997) in 1987 to develop an in-house brokerage department for global vendor services. She was named global director of Brokerage Operations in 2001. In 2004 the Brokerage department became a corporate-wide function responsible for off-lease disposition of inventory. Prior to joining Key, Kay was manager of Brokerage Operations for StorageTek. Kay has served on the board of directors for the DDA (Digital Dealers Association) and served as chairman of their Ethics Committee. She was also on the board of directors of the ITRA (Information Technology Resellers Association) and is currently a member of the Association of Service and Computer Dealers International (ASCDI). Key Equipment Finance is an affiliate of KeyCorp (NYSE: KEY) and provides business-to-business equipment financing solutions to businesses of many types and sizes. They focus on four distinct markets: · businesses of all sizes in the U.S. and Canada (from small business to large corporate); Headquartered outside Boulder, Colorado, Key Equipment Finance manages a $12.6 billion equipment portfolio with annual originations of approximately $5.7 billion. The company has major management and operations bases in Toronto, Ontario; Albany, New York; Chicago, Illinois; Houston, Texas; London, England; and Sydney, Australia. The company, which operates in 26 countries and employs 1,100 people worldwide, has been in the equipment financing business for more than 30 years. Additional information regarding Key Equipment Finance, its products and services can be obtained online at KEFonline.com. Cleveland-based KeyCorp is one of the nation's largest bank-based financial services companies, with assets of approximately $93 billion. Key companies provide investment management, retail and commercial banking, consumer finance, and investment banking products and services to individuals and companies throughout the United States and, for certain businesses, internationally.### Press Release ########################### Western Alliance Reports Net Income of $11.3 Million or LAS VEGAS----Western Alliance Bancorporation (NYSE:WAL - News) announced today its financial results for the second quarter 2006. Second Quarter 2006 Highlights: Net income of $11.3 million, up 34.1% from $8.4 million in the first quarter 2006 and 72.6% in the second quarter 2005 Diluted earnings per share of $0.39, compared to $0.33 in the first quarter 2006 and $0.32 in the second quarter 2005 Net revenue (sum of net interest income and non-interest income) of $44.2 million, up 34.3% from $32.9 million in the first quarter 2006 and 61.8% from the second quarter 2005 Loans of $2.77 billion at June 30, 2006, up 17.8% or $419 million from March 31, 2006, and 90.8% or $1.32 billion from one year ago, including organic growth of $185 million and $678 million, respectively Deposits of $3.20 billion at June 30, 2006, up 8.1% or $241 million from March 31, 2006, and 46.1% or $1.01 billion from one year ago, including organic growth of $57 million and $403 million, respectively Completed merger with Bank of Nevada on April 28, 2006 Acquisition Activity On April 28, 2006, and March 31, 2006, we completed our mergers with Bank of Nevada and Intermountain First Bancorporation (Nevada First Bank), respectively. Total assets, loans and deposits of acquired banks at June 30, 2006, were $845 million, $642 million and $606 million, respectively. We added a total of seven full service branches in Las Vegas, Henderson, Reno and Mesquite, Nev., through these mergers. Financial Performance Western Alliance Bancorporation reported net income of $11.3 million for the second quarter 2006, up 34.1 percent from $8.4 million for the first quarter 2006 and 72.6 percent from $6.6 million for the second quarter 2005. Diluted earnings per share were $0.39, an increase of 18.2% from $0.33 for the first quarter 2006 and 21.9 percent from $0.32 for the same period one year ago. Net income and fully-diluted earnings per share are net of $0.3 million and $0.01, respectively, of organizational costs related to our proposed expansion into Northern California. Our fully-diluted shares outstanding were 29.0 million for the second quarter of 2006, compared to 20.5 million for the same period last year. A significant factor in the 41.6 percent increase in our fully-diluted shares outstanding was the issuance of 4.2 million shares in our IPO which took place on June 30, 2005. Loans grew $419 million, including organic growth of $185 million, to $2.77 billion at June 30, 2006, from March 31, 2006, and $1.32 billion, including organic growth of $678 million, from June 30, 2005. Deposits grew $241 million, including organic growth of $57 million, to $3.20 billion from March 31, 2006, and $1.01 billion, including organic growth of $403 million, from June 30, 2005. "Despite the challenges facing the banking industry of a flat yield curve and shrinking liquidity, we continued our exceptional balance sheet growth and earnings performance in the second quarter," said Robert Sarver, chairman and chief executive officer of Western Alliance. "Strong organic loan growth for the quarter of $185 million again exceeded our expectations. Although our organic deposit growth of $57 million was shy of our $100 million quarterly goal, our lower-cost funding was augmented by a $48 million increase in repurchase agreements from customers. Our earnings per share were up over 20 percent in the second quarter compared to last year, even though the 4.2 million shares from our initial public offering were not in last year's share count." Sarver continued, "In part benefited by our accretive acquisitions, our interest margin increased 21 basis points and our efficiency ratio improved by nearly four percentage points compared to last quarter. Importantly, our asset quality remains exceptional with virtually zero non-performing assets and delinquent loans, and net recoveries year-to-date. Our expansion plans remain robust with entry into the East Bay and Northern Arizona in the coming months and continued rollout of new offices in our existing markets. Our Service Center in Las Vegas is expected to open by the end of this quarter, enabling us to increase our product array to our client base." Full press release here: ### Press Release ########################### Governor and MEDC Announce 21st Century Jobs Trust Fund Investment Manager Credit Suisse Chosen to Manage Jobs for Michigan Investment Fund Governor Granholm and Michigan Economic Development Corporation President and CEO James C. Epolito today announced the Michigan Strategic Fund (MSF) has contracted with Credit Suisse to develop and administer investment programs under the Jobs for Michigan Investment Fund, a key component of the 21st Century Jobs Trust Fund initiative. The State Administrative Board approved the contract today. “An excellent reputation within and outside Michigan and solid track record were key factors in the board's decision to select Credit Suisse as Fund Manager,” said Epolito, who also serves as president and chairman of the MSF board. “We look forward to working with such a highly esteemed group of investment professionals to carry out our long-term investment strategy to grow new companies and jobs in Michigan.” Credit Suisse will direct the state's capital investment programs under the direction of the Michigan Strategic Fund board. Responsibilities will include: establishing and managing an investment plan, supervising the issuance of a request for proposals to solicit funds, evaluating and recommending funds for investment and monitoring performance and ensuring response to capital calls and disbursements. “We believe the 21st Century Jobs Fund initiative will have a major impact on growing Michigan's high-tech economy, and look forward to having a role in this great transformation,” Credit Suisse Managing Director Kelly Williams said. “With the evidence of new investment opportunities arising in the state, Credit Suisse will open a Michigan office to support activities surrounding the Jobs for Michigan Investment Fund.” A total of five investment firms submitted bids in response to the Request for Proposals which was publicly launched on April 20. The MSF board has dedicated up to $114 million in 2006 and 2007 for investment programs in qualified private equity, mezzanine and venture capital funds, with up to $400 million available over the course of the 21 st Century Jobs Trust Fund. “Partnering with one of the top investment firms in the world will accelerate our efforts to diversify our economy by providing the right kind of environment where high-tech companies can flourish and create high-paying jobs for Michigan workers,” Governor Jennifer M. Granholm said. The MEDC provides administrative services to the MSF Board on 21 st Century Jobs Trust Fund programs as part of the Governor's Jobs Today, Jobs Tomorrow plan to grow and diversify Michigan's economy. These programs support state commercialization, capital investment and commercial lending efforts to help convert research findings into products and services that can succeed in the marketplace. The Michigan Economic Development Corporation, a partnership between the state and local communities, promotes smart economic growth by developing strategies and providing services to create and retain good jobs and a high quality of life. For more information on MEDC initiatives and programs, visit the Web site at www.michigan.org.### Press Release ########################### CIT Declares Dividends for Second Quarter 2006 NEW YORK, -- CIT Group Inc. (NYSE: CIT), a leading global provider of consumer and commercial finance solutions, announced that its Board of Directors has declared a regular quarterly cash dividend of $0.20 per share on its outstanding common stock. The common stock dividend is payable on August 30, 2006 to shareholders of record on August 15, 2006. CIT also announced that its Board of Directors has declared quarterly cash dividends of $0.3968750 per share on the Company's Series A preferred stock and $1.2972500 per share on the Company's Series B preferred stock. The preferred stock dividends are payable on September 15, 2006 to holders of record on August 31, 2006. About CIT CIT Group Inc. (NYSE: CIT), a leading commercial and consumer finance company, provides clients with financing and leasing products and advisory services. Founded in 1908, CIT has $65 billion in managed assets and possesses the financial resources, industry expertise and product knowledge to serve the needs of clients across approximately 30 industries worldwide. CIT, a Fortune 500 company and a member of the S&P 500 Index, holds leading positions in vendor financing, factoring, equipment and transportation financing, Small Business Administration loans, and asset-based lending. With its global headquarters in New York City, CIT has more than 6,700 employees in locations throughout North America, Europe, Latin America, and the Pacific Rim. http://www.CIT.com### Press Release ###########################
News Briefs---- China's Surge Raises Fears of Runaway Economy Yahoo profit falls as sales miss estimates Verizon Overbills 11,000 Customers Santa Clara Valley 2 nd Q Likely to energize start-ups, buy-out firms Coca-Cola reports 7 percent jump in second-quarter profit Reverse mortgages expected to boom ---------------------------------------------------------------
You May have Missed--- The Federal Reserve will raise interest rates next month, and then be done for the year, according to economists surveyed by USA TODAY. ---------------------------------------------------------------
Sports Briefs---- New owners say Sonics will stay in Seattle ----------------------------------------------------------------
“Gimme that Wine” Wine grape growers unite Bankrupt Napa Valley company seeks OK to sell all 3 wineries; other offers may follow San Francisco International Wine Competition, the Largest and Most Prestigious Wine Competition in America, Reveals Its 26th Annual Results North Dakota's first estate winery, Dakota Hills Winery Austrian Wines Have a Voice, and It's Excited Wine Prices by vintage US/International Wine Events Winery Atlas Leasing News Wine & Spirits Page ----------------------------------------------------------------
Calendar Events This Day To be posted—please visit us again today.----------------------------------------------------------------
Today's Top Event in History 1939 - Jack Teagarden and his orchestra recorded "Aunt Hagar's Blues" for Columbia Records. Teagarden provided the vocal on the session recorded in Chicago, IL. (A classic today) ----------------------------------------------------------------
This Day in American History 1692- Five Massachusetts women were hanged for witchcraft. Fifteen young girls in the Salem community charged as many as 150 citizens in the area with witchcraft during the greater part of this year. The Salem witch hunt was unleashed in March of the year when some children, called upon to explain their odd behavior, claimed that three old women had bewitched them. The women were tried, convicted, and condemned on the testimony of the children. Although Governor William Phis halt the trails in October, 1692, by January 1693 twenty persons condemned for witchcraft had been executed and two had died in prison. The first person executive for witchcraft in America was Margaret Jones of Charlestown, Mass. Gov. John Winthrop wrote “that she was found to have such a malignant touch, as many persons, (men, women and children), whom she stroked or touched with any affection or displeasure, etc., were taken with deafness...or other violent pains or sickness...Her behavior at the trial was very intemperate, lying notoriously, and railing upon the jury and witnesses, etc., and in the like distemper she died. “ --------------------------------------------------------------
Baseball Poem The Gravity of Memory You knew just where he was going Written by Tim Peeler -------------------------------------------------------------- SuDoku The object is to insert the numbers in the boxes to satisfy only one condition: each row, column and 3x3 box must contain the digits 1 through 9 exactly once. What could be simpler? http://leasingnews.org/Soduku/soduko-main.htm
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