Advance Rentals---Ken Greene,Jr./Barry Marks/Name and Company Name With Held

     Ampent/PDC Solutions "Small Ticket Internet Platform"

      UAEL Funding Retreat--early returns

        Auto  Leasing Customers Sues Banc One over "Late Fees"--Triggers Class Action Suit

          Farm Credit System Reports $1.422 billion Year-End

                 ( They are also very active in equipment leasing. editor )

 

 

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              United Capital

 

I have several reports that the remainder of their portfolio was sold, and this

company may be "disappearing."  I have not been able to get confirmation ( or denial )

of this, but it will become public knowledge pretty soon. editor

 

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        Advance Rentals

 

 ( Name and Company Name With Held...This e-mail has been edited

    to protect the sender. This source is rated reliable, perhaps

   highly reliable, and for the sake of identity, it was edited.  )

 

This is a deal I recently doc'd. When I spoke to this customer in **** I got

an application from him and pulled credit it was not that bad so I quoted

him at competitive rates and doc'd the deal.  When the check was in house I

started looking for an approval for the customer.  Here is where I got

confused.  I had quoted the customer one rate but very rarely am I able to

give it to them.  If I can provide an approval it is usually much higher

than the original quote. I then tell the customer that he can either pay the

increased rate or I keep his money. Those are his only choices. So I make

money on almost every set of documents I send out either on the funding or

on the advanced rentals.

 

Myself and many of the other employees here and at ****** are making

a nice living off of advanced rentals and the current commission structure.

I've seen thousands accumulated in a few weeks. We are pretty much

commission driven.....( including document fees and the ability to get a percentage

of the advance rentals ).

 

Thank you for keeping my name out of this. we have been informed that we

will be fired immediately for writing you about any subject.

 

             +              +           +

 

 

Re: Advance Rentals/Committment Fees   

 

  With reference to Mr. Fleming's comments on advance rentals, I think your readers should bear

in that both Joe Bonanno and I have been warning for years that collecting rents and

security deposits before deals are approved, while a common practice and not per se

unreasonable, can lead to a lot of trouble. It is an issue the NAELB has addressed in

newsletters and articles - some of which are on Joe's and my web sites.

 

Many states have laws (often unenforced) prohibiting this practice except by state and national

banks. Others require registration and/or bonds.

 

At the very least, the lessee should sign a clear agreement as to the application or return of

the funds and brokers should carefully consider whether to get the checks in their own names and endorse them over to the funder or have them made out to the funder directly and step out of the line of fire (at least in part).

 

As always, thanks for your continuing service to us all!

 

Barry Marks

www.leaselawyer.com

 

       =            +             +              +

 

 

    In response to the recent clamor regarding the retention of "advance

rentals", this is, in my opinion, clearly an issue of contractual intention,

whether that contract is written or oral. In the arena of commercial

transactions, which constitute the bulk of the lease and finance deals in

which our clients are involved, the parties are by law free to agree to any

arrangement which is neither against public policy nor unconscionable. If a

"committment fee" is meant to be non-refundable, as it can be under

appropriate circumstances, the parties should specifically agree to this. It

is best of course that this agreement be written. If there is no written or

oral agreement, it is my position that advance rental fees and the like are

refundable if no lease or financing is consummated. Brokers and lessors

wishing to agree otherwise should make sure that their prospective customers

recognize this fact, and that their agreement is embodied in a clear and

unambiguous writing. If their is no meeting of the minds on this issue, I

doubt that the courts will be inclined to allow brokers or lessors to retain

advance rentals even if time and energy is expended and no deal is done, just

as is the case in the real estate and loan brokerage fields.

Ken Greene

Kenneth C. Greene & Associates

kgreene100@aol.com

 

 

            +               +               +

 

 

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  Early Returns on the United Association of Equipment Leasing Seattle Funding Retreat

 

     "There are more funders than leasing companies.  We have only had four scheduled

appointments."

 

   Funder Name With Held

 

    ( We hope to have heard from attendees and others on Monday for the full story ).

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PDC Solutions Selects Ampent's(tm) Capital Acceleration Platform(tm) to

Power Its Small-Ticket Leasing Transactions

 

SAN FRANCISCO, CA. -  - Ampent(tm) (formerly AccessLease.com) announced that PDC Solutions, a

leading integrator and supplier of computer related products, has chosen Ampent's Capital

Acceleration Platform(tm) to handle its small-ticket leasing.  Through

Ampent's platform, PDC will provide its customers with an automated,

real-time lease processing solution-bringing the lease closer to the

point-of-sale.  In addition, Ampent's Wholesale Funding Network offers PDC's

customers a much higher likelihood of lease approval along with competitive,

risk-adjusted pricing.

 

"Ampent's Capital Acceleration Platform is a great addition to the

traditional, off-line methods that we have been offering," said Robert P.

Bonocore, President & CEO of PDC Solutions.  "With Ampent's platform we can

provide our small-ticket lease purchasers with an efficient, real-time

processing solution that generates high approval rates, while returning

significant value to us and savings to our customers."

 

"Ampent looks forward to building a strong, working relationship and

providing PDC with our automated online leasing solution and bringing them a

wider selection of financing options, faster lease processing and

significant cost savings," said Mike Popovich, Vice President, Sales of

Ampent.  "With PDC's 15-year history, expansive customer base and quality

partners, we expect them to be a perfect match for our financing solution."

 

 

The inherent inefficiencies in the traditional off-line leasing market make

Ampent's streamlined solution an attractive platform for companies like PDC

that wish to pass on the savings, speed, simplicity and online account

management to their customers.

 

With the cooperation of its funding partners, Ampent is the first company to

develop proprietary technology that enables end-to-end automation of the

lease-finance process.  Ampent's leasing solution includes: real-time credit

scoring and decision making, risk-adjusted pricing through its network of

funding sources, sophisticated lease analysis tools, automated documentation

generation and online status reporting.

 

 

About Ampent(tm)

Established in 1997, Ampent(tm), formerly Accesslease.com, provides for the

frictionless distribution of capital through the financing supply chain,

accelerating commercial lease transactions for small-ticket equipment

vendors, funding sources and lessees. With their patent pending Capital

Acceleration Platform(tm) (CAP), Ampent significantly increases the speed,

efficiency and quality of finance transactions while the reducing the cost

and effort associated with traditional lease processes.  Headquartered in

San Francisco, CA, Ampent is a member of the Equipment Leasing Association

of America and the United Association of Equipment Leasing and is backed by

Athena Technology Ventures, Artemis Ventures, Sterling Payot Capital and

other investors.  For more information visit Ampent online at www.ampent.com

<http://www.ampent.com>.

About PDC Solutions, Inc.

PDC is a national systems integrator, complete with comprehensive

engineering services, and supplier of leading computer industry products,

including Sun Microsystems (NASDAQ: SUNW), Oracle (NASDAQ: ORCL), Microsoft

(NASDAQ: MSFT), Compaq (NYSE: CPQ), StorageTek (NYSE: STK), Network

Appliance (NASDAQ: NTAP), Legato (NASDAQ: LGTOE) and Netscape (NYSE: AOL).

PDC delivers expertise to effect Oracle and Sun based e-Commerce solutions

enabled by technology for network information security, networked storage

management and empowering help desk and training support to assure business

continuity for the enterprise. As a leader in standards-based storage

management, PDC has taken a leadership position in offering storage area

network planning and implementation services for heterogeneous computing

environments, including solutions from McData, Gadzoox Networks (NASDAQ:

ZOOX) and Brocade Communication Systems. For more information, contact PDC

at (800) 654-4PDC, or visit the company on the Internet at

<http://www.pdc.com>.

 

--30--

Contact:

 

Ampent

Parker H. Trewin

Senior Marketing Manager

415-946-6300

ptrewin@ampent.com

 

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 Auto Leasing Customer Sues Bank One re: Late Fees

 

Bank One Corp. has been hit with a lawsuit charging it deceived customers by waiting until it

could charge late fees before posting some auto leasing payments. The lawsuit was filed in U.S.

District Court in Nashville on behalf of Joyce Cope, a Tennessee resident who leased a vehicle

through the No. 5 U.S. banking company's auto finance subsidiary, based in Louisville, Ky.

Cope's lawyer, Peter Klett, a partner with the firm of Stewart, Estes & Donnell, said she was

charged late fees even though Bank One Kentucky Vehicle Leasing Co. received her payments before penalties could legally be triggered. Klett is seeking class-action status for the case, which

also claims the bank failed to disclose the fees. Bank One spokesman Stan Lata declined to

comment.

Farm Credit System Reports Net Income of $1.422 Billion for 2000

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"...a one-time gain of $27 million recognized by certain Banks in connection with the sale of their investment in the Farm Credit Leasing Services."

 

NEW YORK--(BUSINESS WIRE)--Feb. 23, 2001--The Farm Credit System reported combined net income of $1.422 billion for the year ended December 31, 2000, as compared with combined net income of

$1.233 billion for the prior year. The combined net income for the fourth quarter of 2000

increased $75 million to $374 million, as compared with $299 million for the fourth quarter of 1999.

 

"The System's favorable financial results for the fourth quarter and the year ended December 31, 2000, reflected the System's overall financial strength," noted James A. Brickley, President and CEO of the Federal Farm Credit Banks Funding Corporation. "While prices for certain commodities

remained

 depressed, agricultural producers, including System borrowers, benefited from direct Federal

government payments during the year that exceeded $22 billion. As a result, the credit quality

of the System institutions' loans generally remained stable or improved slightly during 2000. At December 31, 2000, total System surplus, the dominant component of System capital, rose above the $11 billion level, and total System capital grew to more than $14 billion, representing over 15% of System assets."

 

2000 Results

 

Net interest income increased $127 million to $2.399 billion for the year ended December 31,

2000, as compared with the prior year. This increase was due to income from a higher level of

average earning assets, funded, in part, by an increase in interest-free funds. Average earning

assets were $87.2 billion for the year ended December 31, 2000, $4.4 billion higher than the prior year. The net interest margin increased slightly from 2.74% in 1999 to 2.75% in 2000. This increase resulted from a higher level of income earned on interest-free funds in a higher interest rate environment, principally offset by a decrease in the net interest spread from 1.89% in 1999 to 1.79% in 2000. The decline in the net interest spread was primarily attributable to competitive loan pricing pressures.

 

The provision for loan losses decreased $37 million to $140 million for the year ended December

31, 2000, as compared with the provision for loan losses of $177 million for the year ended

December 31, 1999. The 2000 provision for loan losses was primarily attributable to credit

quality concerns in certain agricultural sectors, including isolated credit events affecting large loans to a few processing and marketing cooperatives, and to growth in the System's loan volume. The 1999 provision for loan losses was primarily attributable to specific credit quality concerns with a limited number of loans to processing and marketing cooperatives and to growth in the System's loan volume.

 

Net noninterest expenses increased $75 million to $765 million for 2000, as compared with $690

million for 1999. Noninterest expenses rose $56 million and noninterest income declined $19

million during 2000. Salaries and employee benefits increased $37 million due primarily to (1)

severance and early retirement costs associated with the mergers of and reorganizations by certain System institutions and (2) merit increases and incentive compensation increases. Included in noninterest income for 1999 was a one-time gain of $27 million recognized by certain Banks in connection with the sale of their investment in the Farm Credit Leasing Services Corporation to another Bank and included in 2000 noninterest income was $19 million of interest related to the tax refunds discussed below.

 

The provision for income taxes declined $100 million to $72 million for the year ended December

31, 2000, as compared with $172 million for the same period of the prior year. The provision for income taxes was favorably impacted by two factors: (1) the recognition of an income tax benefit as the result of a model settlement agreement reached with the Internal Revenue Service (IRS) during the second half of the year and (2) the ongoing restructurings of Agricultural Credit Associations (ACAs), which have formed taxable Production Credit Association and non-taxable Federal Land Credit Association subsidiaries. The model settlement agreement established the collectability of a portion of the claimed refunds of taxes previously paid, plus interest, related to income earned in prior years from the mortgage lending activities of ACAs. For the year ended December 31, 2000, certain ACAs recognized income tax benefits of $93 million representing their portions of claimed refunds. As the remaining ACAs finalize their individual settlement agreements in 2001 based on the model agreement with the IRS, the provision for income taxes will continue to be favorably impacted.

 

The decrease in the provision for income taxes was offset, in part, by the write-offs of

deferred tax assets of $29 million related to the restructurings of certain ACAs. Excluding the

recognition of income tax benefits related to claimed refunds and the write-offs of deferred tax assets, the provision for income taxes would have been $136 million and the effective tax rate for the year ended December 31, 2000 would have decreased to 9.1%, as compared with 12.2% for the prior year.

 

This decrease reflected a lower percentage of income earned at taxable System institutions that

resulted from the ACA restructurings.

 

Fourth Quarter 2000 Results

 

Net income for the fourth quarter of 2000 increased $75 million to $374 million, as compared

with $299 million for the same period of the prior year. This increase was due primarily to the

recognition of a net income tax benefit of $26 million in the fourth quarter, as compared with a provision for income taxes of $54 million for the same period of the prior year, and an increase of $44 million in net interest income. These increases were offset, in part, by increases in net noninterest expenses and the provision for loan losses of $31 million and $18 million,

respectively.

 

The net income tax benefit of $26 million recognized in the fourth quarter of 2000 resulted from income tax benefits of $73 million recognized by certain ACAs representing their portion of

claimed refunds, offsetting provisions for income taxes of $47 million recorded by other System

institutions.

 Excluding the recognition of the income tax benefits related to claimed refunds and the

write-off of $5 million in deferred tax assets in the fourth quarter of 2000, the effective tax

rate for the fourth quarter of 2000 would have decreased to 12.1%, as compared with 15.3% for

the same period ofthe prior year, reflecting a lower percentage of income earned at taxable System institutions as a result of the ACA restructurings.

 

The increase in net interest income was due to income from a higher level of average earning

assets, offset, in part, by a decrease in net interest spread. Net noninterest expenses

increased primarily due to increases in salaries and employee benefits and other operating

expenses. The increase in the provision for loan losses was due primarily to the deterioration in the credit quality of certain loans to cooperatives and to growth in the System's loan volume.

 

Statement of Condition

 

Gross loan volume rose $5.221 billion, or 7.5%, to $75.223 billion at December 31, 2000, as

compared with year-end 1999 volume of $70.002 billion. The overall increase in the System's loan volume was due primarily to growth in the long-term real estate loans, short- and

intermediate-term loans and

 domestic loans to cooperatives. The growth in the long-term real estate loans reflected

continued System marketing efforts and competitive loan rates. Short- and intermediate-term

loans increased due to increased demand for production loans and to increased marketing efforts

in certain agricultural sectors. The increase in domestic loans to cooperatives during 2000 resulted primarily from increased lending to the communications and energy sector and agribusiness cooperatives.

 

The System's accruing loan volume was $74.513 billion at December 31, 2000, as compared with

$69.048 billion at December 31, 1999. Nonaccrual loans decreased $244 million to $710 million at December 31, 2000. This decrease was principally attributable to payments received, to

charge-offs on a few

large nonaccrual loans to processing and marketing cooperatives, and to the reinstatement to

accrual status of certain loans, particularly in the hog industry. Nonaccrual loans as a

percentage of gross loans declined to 0.94% at December 31, 2000, as compared with 1.36% at

December 31, 1999.

 

Nonperforming loans (which consist of nonaccrual loans, accruing restructured loans, and

accruing loans 90 days or more past due) decreased by $227 million to $879 million at December

31, 2000. These loans represented 1.2% of the System's gross loans at December 31, 2000, a

decrease from 1.6% at December 31, 1999.

 

Despite some borrowers experiencing the effects of certain weakening agricultural economic

conditions, overall, borrowers' financial conditions remained relatively strong due to the

relatively high levels of net farm cash income realized over the past several years, including

2000. The United States Department of Agriculture (USDA) forecasts net farm cash income in 2000

at $56.4 billion. The 2000 net farm cash income was significantly bolstered by $22.1 billion in

direct Federal government payments. The record level of government assistance in 2000 played a

major role in stabilizing farm income and tempering financial hardship for many System

borrowers. The USDA forecasts that net farm cash income will decline to a level of $50.7 billion in 2001, resulting primarily from a forecasted decline in the level of direct Federal government payments to $14.1 billion.

 

T