Headlines---
Pictures from the Past---Four Scottsdale Golfers
Jobs Sought: Classified Ads
The Week's Economic Events
pAsset-Back Securitization:
The U.S. Equipment Marketplace
Extra
Day for Registration for Leasing News Readers
VC
funding drops to four-year low
Fitch
Places Sky Financial Group on Rating Watch Neg
Blame the souring economy:
Easy credit is hard to come by
Backlog at West Coast ports has retailers
fearing the worst
U.S. Attorney Carol Lam targets terrorism, business
crimes
Streamlined
Sales Tax Update - Revised Interstate Agreement
Leasing News Classified Ads Change-End of this
Month
Help Wanted Advertisers Notified---
two responses:
William J. Barone, Comtech Capital
Gary Saulter, Chase Industries
-------------------------------------------------------------------------------------------
Pictures from the Past-Four Scottsdale Golfers
1998
Steve Reid, Santa Barbara Bank and Trust Leasing, an unknown golfer
( if you know, please send
name an affiliation, Andy Alper, Frandzel, Robins, Bloom & Csato
(LA Law firm ) and Steve Geller,
Leasing Solutions. The picture was sent into by Steve, he thought
a few years old and from a
Scottsdale Conference. ( If you have a picture, send to us by e-mail
or regular mail - we will
return it ).
-----------------------------------------------------------------------------------------
Jobs Sought: Classified Ads
Asset Management: Silicon Valley, CA
Experienced Asset Manager with SMT/PCB equipment focus. Managed/sold
large ticket mid- term and EOL
transactions with global contract manufacturer and OEM accounts.
Email:boklund9@earthlink.net
Asset Management: Nashville, TN
Experienced Asset Manager with construction/ telecom focus. Managed
portfolio of repo & EOL
transactions for large leasing companies. 10 years experience including
sales & credit/ collections
focus. Email:jambam2000@comcast.net
Asset Management: Patchogue, NY
12+ yr. Experience in Auto/Equipment Leasing. Managed Liquidation
of Repo & E.O.L. Portfolios.
Managed Litigation Portfolio as well. Exp. in Bankruptcy. Looking
for suitable position in
Tri-State area. Email:THood8663@Yahoo.com
Collector: Oceanside, CA
Collections supervisor, experienced with commercial leasing. motivated,
good work ethic,
enthusiastic. call (760)941-9209 Email:mantinarelli@yahoo.com
Contract Administrator: Schaumburg, IL
10 yrs. small/mid-ticket leasing. Proficient in documentation, funding
and legal. Worked with
brokers, portfolio purchases, vendor programs, municipal transactions.
prefer to stay in Suburban
Illinois. Email:sophie1900@msn.com
Contract Administrator: Chicago/Naperville
18+ years experience in leasing US/Europe, as both lessee and lessor.
Am versatile and adaptable to
lessee, lessor, or lender career opportunity. Chicago relocation
desired. Email:kris_k11@yahoo.com
Full list at: http://65.209.205.32/LeasingNews/JobPostings.htm
_____________________________________________________________
The
Week's Economic Events
October 28 MONDAY
None
October 29 TUESDAY
Consumer Confidence: October
October 30 WEDNESDAY
None
October 31 THURSDAY
G.D.P. 3rd Quarter.
Weekly Jobless Claims
November 1 FRIDAY
Personal Income: September
Unemployment: October
Construction Spending: September
-----------------------------------------------------------------------------------------
Asset-Back Securitization: The U.S. Equipment Marketplace
The Equipment Leasing and Finance Foundation, a non-profit organization
dedicated to enhancing recognition and understanding of equipment
lease
financing, has released a new study, "Asset-Backed Securitization:
The
U.S. Equipment Leasing Marketplace."
The full report is available at no charge at
http://www.elaonline.com/press/_noindex/Securitization.pdf
Citing examples of specific asset-backed securitization (ABS) issues
from a variety of industries, credit agencies' criteria for rating
ABS
issues, and the input of institutional investors, this report provides
the most comprehensive information available on equipment leasing
asset-backed securitization.
The report's findings show:--- The reasons for a have and have-not
environment (where other ABS
trade more favorably than those of equipment leasing companies)
are (i)
the non-uniform nature of the equipment lease assets securitized,
(ii)
uncertainty as to residual value of such assets, (iii) the servicer's
role and impact of its own potential default and (iv) the limited
liquidity of equipment leasing ABS ("ELABS")
.
--- Equipment lease financing companies can find cheaper, more
accessible financing than has currently been available to them through
securitization by (i) structuring transactions to increase cash
flows
and to enhance reserve and spread accounts, (ii) responding to supply
and demand/cycles, such as issuing more floating-rate tranches with
hedges, where dictated by the market, (iii) providing liquidity
through
puts or other means in individual transactions and (iv) assisting
in the
growth of a secondary market for both the underlying asset portfolios
and for the ELABS, themselves.
--- Small and/or first-time equipment leasing issuers can gain access
to
the ELABS marketplace by (i) building a favorable pre-securitization
performance track record, (ii) capturing performance data
pre-securitization, thus allowing for both meaningful due diligence
and
post-transaction follow-up and (iii) obtaining monoline bond insurance
to get the issue to market and (iv) considering issuing the securities
with other sellers ("Hybrid Multi-Seller ABS"), as an
innovation on the
current "traditional" ELABS term securitizations and the
Asset-Backed
Commercial Paper ("ABCP") conduits through banks.
The research report was undertaken to determine the reason other
asset-backed securities (ABS) trade more favorably than those of
equipment leasing companies; how equipment lease financing companies
can
find cheaper and more accessible financing through securitization
than
has currently been available to them and how small equipment leasing
companies can gain access to the marketplace.
---------------------------------------------------------------------------------------
Extra Day for Registration for Leasing News Readers.
Friday is Free/Saturday $95 Broker/Second Attendee $75
$135 funder/second attendee $115
Exhibit Table: $200
(registration at the event is $20 in addition to the above)
(if this were Consumer Reports, this conference would be a "Best
Buy." )
November 8th/9th Marina del Rey, California
I don't know if I was as clear as I could have been in an earlier
announcement about the National Association of Equipment Leasing
Broker''s upcoming regional
meeting on November 8th and 9th in Marina del Rey, California.
The free Networking Reception on Friday evening, the 8th, is open
to ANYONE
in the industry regardless of whether or not they're an NAELB member
and
regardless of whether or not they've registered for the educational
meeting
the next day.
The reception will be a chance to meet the NAELB Board of Directors
and
other industry colleagues and to talk shop, brag, commiserate, gossip
or
just plain have fun. There's no charge to attend the reception,
but advance
reservations are required.
Anyone who cannot make it to Saturday's meeting but still wants
to come to
the free Friday evening reception on November 8th, at the Marina
del Rey
Hotel, should call the NAELB office at: (800) 996-2352; or send
an e-mail
to: info@NAELB.org.
We plan on having a great time and hope to see lots of
your readers there!
Thanks for helping me clarify that, Kit.
Gerry Egan
President
NAELB
President
TecSource, Inc.
5621 Departure Drive, Suite 113
Raleigh, NC 27616
Phone: 919-790-1266
Fax: 919-790-2262
E-Mail: mailto:GerryEgan@ForEquipmentLeasing.com
http://www.leasingnews.org/PDFFiles/regional%20conference%20flyer.pdf
--------------------------------------------------------------------------------------------------
VC funding drops to four-year low
By Matt Marshall
San Jose Mercury News
Venture capital investments into private start-ups plunged in the
third quarter to the lowest level
in more than four years, led by health care, which declined 47 percent.
The fall is significant because it deflates the assumption that
the venture industry had neared its
bottom. The market decline in health care is also a blow to venture
capitalists and other
professionals who had entered the sector with hopes it might defy
the woes suffered by the
high-tech industry.
Nationally, venture capitalists invested $3.9 billion during the
quarter, a 23.5 percent decline
from the $5.1 billion invested in the second quarter, according
to a report to be released today by
Ernst & Young and VentureOne.
Venture capitalists invested $947 million in health care, which
includes biopharmaceuticals and
medical devices, down from $1.8 billion the quarter before.
Start-ups in the Bay Area fared better than the national average.
Venture capitalists invested $1.5
billion in the third quarter, or 15.3 percent less than the $1.7
billion in the second quarter.
That means the Bay Area continues to soak up more than a third of
the nation's venture capital, a
sign that Silicon Valley's domination of the industry has not been
challenged.
In the Bay Area, investments in health care fell by 33 percent to
$309 million, from $463 million.
In one hopeful sign, investments in information technology start-ups
appeared to stabilize,
particularly in the Bay Area. Nationally, they declined 1.7 percent
to $2.5 billion. In the Bay
Area, they fell 0.6 percent, to $1.1 billion.
----------------------------------------------------------------------------------------------------
Fitch Places Sky Financial Group, Inc. on Rating Watch Neg
Fitch Ratings-New York-: Fitch Ratings has placed the ratings for
Sky Financial Group, Inc. (SKYF,
'BBB+/F2') and its principal subsidiaries on Rating Watch Negative
following SKYF's announcement
today of a definitive agreement to acquire Metropolitan Financial
Corporation (METF). A complete
list of ratings follows at the end of this release.
SKYF's acquisition of METF ($1.5 billion in total assets, 24 branch
offices) increases SKYF's
presence in the Cleveland market. The merger is subject to shareholder
and regulatory approvals and
is projected to close in the second quarter of 2003. Fitch recognizes
the potential strategic
benefits of a larger presence in a growing metropolitan market.
However, the transaction will
pressure capital, with levels of the combined entity declining significantly
from SKYF's current
and historic levels. With some uncertainty in the degree of financing
of the transaction, tangible
common equity (TCE) is projected at less than 5.5% of tangible assets.
Management's expectations
are for TCE to build to 6.5% within two years of the close of the
acquisition. SKYF has integrated
previous acquisitions successfully. However, this transaction does
involve elevated credit risk and
significant acquisitions risk at a time when SKYF is integrating
its most recent purchase of Three
Rivers Bancorp. Should SKYF meet its capital forecasts, a resolution
to the Rating Watch would
likely be limited to a one notch downgrade in SKYF's current long-term,
short-term, and individual
ratings. Additional common equity injections to shore up capital
may alleviate some pressure on
SKYF's ratings.
------------------------------------------------------------------------------------
Blame the souring economy: Easy credit is hard to come by
By Philip Klein
REUTERS
The sales pitch, "No credit? No problem!" is now a major
problem for lenders.
When the economy was surging, lenders were willing to extend credit
to anyone with an urge to
spend, even those with a history of bankruptcy. Some lenders even
boasted of their ability to offer
online credit card approval in 30 seconds or less.
But times have changed.
The so-called subprime lending market that caters to those with
poor or thin credit histories has
been brought to its knees, hit by the twin blows of a weak economy
and increased scrutiny by
regulators.
The new climate not only threatens to slow long-term growth prospects
for the consumer credit
industry - led by firms such as Providian Financial, Capital One
Financial and Sears - but it also
makes it more difficult for low-income borrowers to get credit cards
and loans for homes and cars.
The changes come at a bad time for the fragile economy, as resilient
consumer spending, which
accounts for two-thirds of economic activity and has been aided
in part by easy access to credit,
has helped keep the economy afloat.
"I don't think there will be too many unemployed people walking
into Circuit City and walking out
with a big-screen TV," said Reilly Tierney, an analyst with
investment banker Fox-Pitt, Kelton
The number of credit card solicitations that Americans receive by
mail is still on pace to set a
record, exceeding the record 5 billion mailings from last year,
according to Mail Monitor, a
service of BAIGlobal Inc.
But the pace of growth is leveling off after years of rapid expansion,
and offers are targeting
richer borrowers.
"A year and a half ago, we saw a resurgence of gold (credit
card) offers because they were being
used to target less credit-worthy customers," said Andrew Davidson,
a vice president at BAIGlobal.
"When the economy turned last year we saw those decline and
a bigger increase in the portion of
platinum (card) offers."
Platinum cards, which are offered to customers with better credit
records, now account for eight
out of 10 solicitations, he said.
This is a turnaround for the subprime lending industry, which exploded
in the 1990s as lenders were
able to charge high-enough interest rates to justify extending credit
to high-risk borrowers.
But as the economy soured, subprime credit card issuers such as
Providian and Internet issuer
NextCard racked up huge losses on loan defaults.
Providian was the worst performer in the Standard & Poor's 500
index last year and has moved to get
out of the subprime market.
The now-delisted NextCard, whose stock crested at over $50 in 1999
when it was touted for
revolutionizing the credit card industry, has been barred from issuing
cards. Its collapse is the
subject of an investigation by the Securities and Exchange Commission.
The Federal Deposit Insurance Corp. said the collapse would cost
the insurance program $300 million
to $400 million.
Problems at Providian and NextCard prompted greater scrutiny of
the credit card industry. Federal
regulators are expected within weeks to unveil the final details
of new rules that would ask
issuers to boost their reserves for bad loans.
Credit card issuer Capital One, which has grown at an explosive
pace largely on adding subprime
customers, earlier this month told investors they could no longer
count on the company to deliver
the same type of growth, given the new regulations.
The company said it would cut back on marketing and shy away from
those with patchy credit. Its
stock has fallen about 40 percent this year.
Retailer Sears, Roebuck and Co., whose credit card operations at
one point accounted for nearly
two-thirds of its operating earnings, recently reported that quarterly
profits fell as it held too
many bad debts on credit card loans. The news pushed its stock to
a 10-year low.
On top of difficulties faced by credit card issuers, companies that
extend home equity loans to
low-income borrowers have been slammed by new "predatory lending"
laws that try to prevent lenders
from misleading borrowers into paying higher interest rates or unnecessary
fees.
Earlier this month, Household International Inc., the No. 2 U.S.
consumer finance company, reached
a record deal with 20 states worth as much as $484 million to settle
predatory lending charges.
The deal came weeks after Citigroup Inc. reached a $240 million
predatory lending agreement.
It is too early to tell whether predatory lending legislation, which
has been passed in many
states, will have the unintended consequence of limiting options
for low-income borrowers by making
it more difficult for lenders to do business.
But even if lenders wish to continue in the subprime market, the
technology may not exist for
lenders to efficiently assess potential risk, according to Nicolas
Retsinas, director of Harvard
University's Joint Center For Housing Studies.
"In the subprime market I don't think the risk dimensions are
as finely tuned," Retsinas said. "I'm
not sure that the technology measures and prices risk in a way that
serves the marketplace."
----------------------------------------------------------------------------------------------------
Backlog at West Coast ports has retailers fearing the worst
By Gary Gentile The Associated Press
LOS ANGELES - A maddening backlog of import containers at West Coast
ports has many
retailers upset that toys, shoes, TVs and other goods are not moving
fast
enough to shelves from ships.
"There are an awful lot of Christmas presents" sitting
on the docks, said J.
Craig Shearman of the National Retail Federation.
While dock workers returned to the job last week after a two-week
lockout,
shipping line officials said longshoremen are delaying the unloading
of
container ships onto trucks and trains.
Acknowledging that goods aren't moving at their normal pace, the
union
representing 10,500 longshoremen at 29 major West Coast ports said
shippers
caused the slowdown. They also aren't providing the necessary equipment
to
unload ships, the union says.
"For us, it doesn't matter what the reason," the retailers'
Shearman said.
"The fact remains the goods aren't coming into the stores as
quickly as we need
them."
Exporters also are being hurt. Many worry that if the slowdown persists
and
a required cooling off period ends with another lockout or strike,
customers in
Pacific Rim countries will start to look elsewhere for agricultural
products,
machine parts and other goods.
Orange and grapefruit growers are especially concerned their exports
to Asia
for the Chinese New Year, which begins Feb. 1, could be held up.
Navel oranges
will be ready for shipping at the end of December and early January,
just as
the cooling-off period ends.
The Pacific Maritime Association, which represents shipping companies
and
port operators, and the International Longshore and Warehouse Union
have held
contentious negotiations since spring.
The acrimony between the two sides culminated in a lockout of dock
workers
Sept. 29. The shipping lines accused the longshoremen of a work
slowdown, but
the union said it was working according to safety regulations, which
slowed the
pace of work.
The 10-day lockout, estimated to cost the nation's economy about
$1 billion
a day, ended Oct. 9 after a judge ordered the ports reopened.
When the lockout ended, about 200 container ships were docked or
anchored
off the Pacific coast. At the ports of Los Angeles and Long Beach,
the world's
third busiest, many of those ships remain stuck in the backlog.
This week, the shipping lines filed documents with the Justice Department
accusing longshoremen of a deliberate slowdown since returning to
work. They
said longshoremen are working 34 percent below the normal work rate
in Oakland
and 9 percent less at the ports of Los Angeles and Long Beach. Other
slowdown
rates include 29 percent in Portland, Ore., 27 percent in Seattle
and 19
percent in Tacoma, Wash., the association said.
The figures compare the number of containers longshoremen moved
on and off a
vessel each hour at a particular port before and after the lockout.
The union blames the gridlock on unsafe working conditions and disorganized
terminal operators.
On Friday, union officials said they had filed documents with the
Justice
Department rebutting the association's claims of a slowdown.
"There's no evidence backing it up. There's no way they can
be independently
verified," union spokesman Steve Stallone said.
Anticipating the difficulty in receiving goods, many retailers --
especially
large chains such as Wal-Mart Stores Inc. and large toy retailers
--
accelerated delivery of holiday merchandise during the summer.
----------------------------------------------------------------------------------
U.S. Attorney Carol Lam targets terrorism, business crimes
San Diego Tribune Union
Carol Lam, the new U.S. attorney - openness and accessibility of
people and institutions has made
her both well-known and successful here in San Diego. In this region
of migrants, her story clicks
into the San Diego socket. Listen, as she answers the usual questions
we all ask each other:
"My parents came from Shanghai to New York just before the
Communists took over China. (She is this
district's first Asian- American U.S. attorney.) I lived in New
Jersey, went to college in the East
(Yale) and came out to Stanford for law school. I met my husband,
who was studying for his Ph.D. in
geophysics at Scripps (Institution of Oceanography). I thought I'd
come down here until he finished
in about three years. It took about eight years. By then, I was
entrenched in San Diego. Now, I've
told him, 'We're not going anywhere.' "
Entrenched indeed, now, in the powerful role of choosing her own
priorities for assigning a staff
of about 120 federal attorneys: The district encompasses San Diego
and Imperial counties and, she
says with civic pride, is "considered a large office throughout
the U.S. attorneys community."
Terrorism is "the No. 1 target in America and especially in
this district," Lam says. She will
emphasize security of the increasing flow of container cargo shipping
into San Diego.
Along with successful prosecution of white-collar crime like the
case of CEO Michael Fanghella and
PinnFund USA (on which she worked while chief of major frauds section),
Lam's priorities include
"large and complex narcotics cases, Medicare and tax fraud
and other federal cases that can be
handled only by federal prosecutors. We will increasingly emphasize
training our attorneys to do
large cases that overlap other districts."
At 43, she and her husband, Mark, who live in La Jolla, are parents
of four children. From early
youth, she has shown a restless urge to explore wide interests.
She was a young reporter on Newsday
in Long Island, and later principal flute in the Stanford Symphony;
in San Diego, when time
allowed, she has played with the La Jolla / UCSD Symphony.
For two years prior to her appointment as U.S. attorney (succeeding
Gregory Vega), she was a
Superior Court judge in Vista.
"I am very glad," she says, "to have been on the
state bench. It was my introduction to what kinds
of cases are prosecuted by the state. It helped me think of law
enforcement throughout the district
as a whole. I learned what local and state government can and cannot
cover, and where federal
responsibilities lie."
She finds San Diego "way, way ahead of many other U.S. court
districts in cooperation among law
enforcement people. We have a state-of-the- art computer lab that
is the model for the nation,
tying in federal and state. When a search warrant is done and computers
are seized, they can image,
download and analyze."
The office has grown rapidly because of caseloads rising from border
crime. Lam earlier served 14
years with this same office as a federal prosecutor, often working
her share of border drug and
migrant cases. But for her, those years were heavily weighted with
high-profile white- collar crime
in the San Diego region. She won a reputation for skilled pursuit
and key convictions:
She helped to prosecute Chris Petti, who was convicted in 1990 of
money-laundering that led to the
conviction of financier Richard Silberman, then married to Supervisor
(and later Mayor) Susan
Golding.
In a Medicare billing fraud case, she prosecuted La Jolla-based
National Health Laboratories. In
1992, its president, Robert Draper, pleaded guilty and the company
paid $110 million in damages.
Lam learned that the precedent of hard sentences can sometimes deter
criminals. In a Superior Court
trial, she sentenced a notorious bank robber to 175 years to life
in prison.
"We have a very large responsibility," she says, "in
proactive cases in which we work with federal
agencies and investigators. We generally decide when the indictment
will come down, when the arrest
will happen and in what fashion."
Border and white-collar are different types of jobs for prosecutors,
Lam says. "Both types go on in
the U.S. Attorney's Office at the same time. When someone is arrested
and jailed, they are in the
system and something must be done with them. These are front-burner
cases.
"Our proactive cases, however, tend to be very large and important
in another way. This is when we
try to think of law enforcement throughout the district as a whole.
In these cases, we have a huge
and often sole responsibility."
Because of political appointment, Lam's tenure, like that of all
U.S. attorneys, "might be two
years or it might be six years. It is a limited opportunity, and
all U.S. attorneys need to decide
where their emphasis is going to be during that time.
"It seems very obvious to me there are certain types of cases
that if this office doesn't handle,
they simply won't be done. These are cases so large they can go
unnoticed or seem so large we
simply can't take them on. The PinnFund case fell into this category.
Here's a $300 million fraud
that at first seems overwhelming. But these are cases that if the
U.S. attorney doesn't take them,
no one else can. We have the advantage of having nationwide subpoena
powers for both documents and
individuals for testimony, whereas sometimes it's a hurdle for state
or local prosecutors to go
outside their own territories."
----------------------------------------------------------------------------------------------------
Streamlined Sales Tax Update - Revised Interstate Agreement
The Drafting Committee of the Streamlined Sales Tax Project requests
your comments on the document
in this attachment that seeks to incorporate revisions to the Interstate
Agreement made over a
number of meetings. The only changes that have been proposed but
not yet incorporated are
splitting section 304 into two sections, making sure that numbers
are consistent, and adding
examples to definitions that are found in some of definition issue
papers. Please send your
comments to Scott Peterson by mid-day on Tuesday, October 29 at
Scott.Peterson@state.sd.us
Dennis Brown
Equipment Leasing Association
DBROWN@ELAMAIL.COM
http://www.leasingnews.org/PDFFiles/November%20Meeting%20Working%20Draft.pdf
_________________________________________________________________________________________
Leasing News Classified Ads Change-End of this Month
"Help Wanted" will change as of November 1. Leasing News
will not take any
more free ads at the end of this month for "Help Wanted."
Jobs wanted, outsourcing, attorney ads will remain "free."
The only restriction
will be a limit of 25 words.
The "Help Wanted" will be open to all with the stipulations
of leasing association,
recruiters and maximum words removed. The main difference will be
advertisers will have to pay for the ad.
A statement on this change in policy will be forthcoming.
Maria Martinez-Wong has been contacting current advertisers.
Here are two responses that she received:
"I am all for your system and would be happy to pay for it.
I never have
receive such a strong, qualified turnout as I have had with the
Leasing
News. As a member of the ELA, I would endorse you classified section
without hesitation. Please feel free to send me the information
needed to
post other positions Comtech capital has available.
"Good job and thank you."
William J. Barone
bill@comtechcapital.com
President
Comtech Capital
"We fully understand the need to charge, hopefully this will
increase the
quality of leasing companies looking for good salespeople. We would
like to
continue advertising. Since we are always looking for new people,
please
consider us amoung the 3 month group. let me know when you want
the ad,
we'll send it in pronto.
"Thanks again, appreciate the opportunity and service you provide."
Gary Saulter
Chase Industries, Inc.
800-968-5000
Fax: 616-459-6822
www.chaseindustries.com
