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Kit Menkin’s Leasing News www.leasingnews.org Thursday, April 18, 2002 Accurate, fair and unbiased news for the equipment Leasing Industry Headlines---- CIT Tyco Lives Recovery is strong, new data indicate KeyCorp Reports First Quarter 2002 Earnings Wives of Leasing Execs find power of love in berry drink from Sweden Beijing Corporate Credit Information System Enters Into Operation Baltimore, Here I Come Recruiters Are Misunderstood---Suggests a Feature Section BancPartners in the Great State of Texas Leasing News----“We Get Letters” Wells Fargo Reports Record Quarterly Earnings Per Share of $.80 Glory days long gone for venture capital, FleetBoston trims its sails Apple beats Wall Street expectations Nigerian E-mail Scam Still Dupes People ###
Denotes press release ___________________________________________________________ CIT
Tyco Lives Amazing,
CIT business is doing great, despite all the secrecy and problems with
the Tyco takeover. It shows that a company does have a personality and
a spirit. There is such a thing as “corporate identity.” Congratulations
to all the employees at CIT Tyco for working your tails off. Leasing
News salutes you. ______________________________________________________________ Recovery is strong, new data indicate Industrial output rate highest in nearly two years; prices stable By Sue Kirchhoff, Boston Globe Staff WASHINGTON - Industrial production rose at the quickest pace in nearly two years in March, while consumer inflation stayed under control despite a sharp increase in energy prices, the government said yesterday, offering fresh evidence that the economic recovery is gaining a firm foothold. There were some glimmers of potential weakness, however. The Commerce Department reported that new housing starts fell by nearly 8 percent from February to March, the steepest decline in two years. But analysts said some falloff was expected, given that February's figures were exceptionally high. The markets focused on the positive news, and a spate of better-than-expected earnings reports from companies including Texas Instruments. The Dow Jones industrial average ended the day up 207.65 at 10,301.32, while the Nasdaq climbed 63.01 to close at 1,816.79. ''Today's industrial production numbers suggest that, instead of just emptying the shelves, businesses finally are starting to place new orders,'' said Bill Cheney, chief economist at John Hancock Financial Services. ''At least in the short term, this means better times for the nation's manufacturers. ''Over the longer term, they, like the rest of the economy, need business spending to pick up, or the rebound could be anemic,'' Cheney said, adding that the economy appeared to have expanded by as much as 5 to 6 percent in the first quarter of 2002, but should slow down in coming months. Federal Reserve chairman Alan Greenspan may offer more signs about the direction of the economy - and interest rates - when he testifies before Congress today. Investors will be looking for clues about how quickly the Fed may start to raise rates, which are now at the lowest level since the 1960s. With inflation remaining within bounds despite the spike in energy prices, the Fed may now have more breathing room. The Labor Department said yesterday that consumer prices increased by a manageable 0.3 percent in March. The figure was well below forecasts and only a slight increase from February's 0.2 percent rise. Further, the ''core'' rate of inflation, which does not include energy and food prices, rose only 0.1 percent. The energy index rose 3.8 percent in March after falling 0.8 percent in February, the Labor Department said. Prices for petroleum-based energy products spiked by 8 percent. Seasonal price increases, concerns about the conflict in the Middle East and supply disruptions in Venezuela have been pushing prices higher in recent days. Analysts said current prices were a drag on the economy, but did not see a direct threat to the recovery unless escalating violence in the Middle East pushed prices still higher. In a separate report, the Federal Reserve said output at the nation's mines and factories - which bore the brunt of the manufacturing-led recession - rose 0.7 percent in March. The report marked the third consecutive monthly increase, with output now at the highest level since August 2001. The gains, which followed months of drastic inventory reductions, were widespread, from autos and home electronics to furniture, appliances and business equipment. Clothing production rose more than 11 percent in the first quarter, nearly reversing a sharp drop at the end of 2001. Aircraft was among the areas showing decline. Factories are still operating at below average rates, despite the improvement. The Fed reported that production in the high-tech sector, including computers and office equipment, communications equipment and semiconductors, increased during the month. Those sectors were still well below year-ago levels, however. In a third report, the Commerce Department said housing starts declined by about 8 percent to 1.65 million in March. While that was a big drop, housing starts were still above year-ago levels. Further, housing starts for the first quarter of the year, overall, were strong. ''Today's report shows housing production is right in line with our forecasts, and the decline is certainly no cause for alarm in the housing industry,'' said Gary Garczynski, president of the National Association of Home Builders. Housing was one of the bright spots in the economy last year, as consumers took advantage of low long-term interest rates to refinance their mortgages and buy new homes. There have been concerns that the housing market could decline or soften in coming months if long-term interest rates start rising. Bruce Steinberg, chief economist at Merrill Lynch, said he did not expect housing to soften significantly. The decline in housing starts was due partly to warmer than usual weather earlier in the year, which may have pushed forward some activity, he said. ''Today's data indicate that there is no inflation and the housing market remains healthy, although it weakened in March,'' said Steinberg. Sue Kirchhoff can be reached at kirchhoff@globe.com. _____________________________________________________________________ ##########
######################################### KeyCorp
Reports First Quarter 2002 Earnings
(courtesy
of ELAonliine.com ) ####
######################################### _____________________________________________________________________________________- Wives
of Leasing Executives find power of love in berry drink from Sweden MORAGA,
CA – Barbara
Lester, wife of Charlie, swears by the exlir. Barbara Kropschot, wife of
Bruce, says it is her daily drink. Pat Roberts drinks it daily for
breakfast. The
incoming president of the United Association of Equipment Leasing, Betty
Kerhoulas, says her husband won’t let her drink it any more.
Bob Cragin of
CIT says his wife can’t handle it. Ginny
Young adds vodka and calls it a “Leasing Wallbanger.” (
If you run into her
at the UAEL Leasing Conference in Las Vegas, ask her why? editor). Now
Debbie Levy is hoping to put her Moraga deli on the map by becoming
one of the first to sell the drink in the East Bay. The owner of Gourmet
Glazed Hams Deli Cafe and Catering last week began peddling Niagara,
the $5-a-bottle elixir that has developed a reputation for triggering
the libido. “We
heard the leasing industry was suffering and executives coming home in
poor moods, not happy with their business, “ she said. “
Women were suffering.
All we wanted to do was bring back a little romance.” The
drink has taken the leasing industry by storm. Bob Fisher of Firerock Capital
drinks two bottles a day. His wife won’t let him drink more. “He
used to come home, dragging his feet, falling to sleep while eating, but
now with Niagra, he is awake until all hours of the night, “
she explained. “That’s
why I told him no more than two bottles of Niagra a day.” Bob
Teichman’s wife says it saved their marriage. A
Food and Drug Administration spokeswoman said the agency categorizes
it as a dietary supplement, which it doesn't regulate, and would not
comment on the drink's effectiveness. None of the leasing association
executives would make a
comment, except for Joanie Dalton, who says her husband now comes
over to
Emeryville for a long noontime lunch since he started drinking Niagra. Because
its name rhymes with the name of the popular erectile dysfunction
drug, Niagara won the distinction "the female Viagra" when
it first became popular last year. Pfizer then filed a lawsuit against
Williams, and the Swedish drink manufacturer announced in August it
would change Niagara's name to Nexcite. Levy is still selling the
drink under the Niagara label. “Maybe
it might spark the leasing industry.” says Rochelle Goodman.
“ It certainly
sparked Ken.” (
Yes, this story appeared in yesterday’s Leasing News, but no
one commented, so
re-wrote it. Niagra would be a great benefit to the leasing industry.
editor ) ______________________________________________________________ Beijing Corporate Credit Information System Enters Into Operation At a press conference on March 28, the Beijing Municipal government announced that the ˇ°Beijing Corporate Credit Information System ¨CWarning System of Corporate Misconductsˇ± has officially entered into operation. It is reported that the system is the first corporate credit platform in China which has been established by a local government. So far, this credit warning system has collected bad credit information of 414 enterprises and 60 individuals. The Corporate Credit Information System consists of four kinds of information: 1) Corporate identification and registration information, including information about a company's registration, annual inspection, and administrative approval; 2) Information about a company’s meritorious deeds, including awards and commendation received by a company or its legal representative from governments at municipal level or above. 3) Early warnings of corporate misconducts, including information about general violation of law and regulation by a company, and corporate discredits which receive administrative punishment or circulated criticism. 4) Warnings of corporate misconducts, including information about serious corporate violation of laws and regulations, and restriction imposed by related administration department on a company’s registration, outbound investment and administrative approval. The establishment of the credit warning system is the first step in the Beijing Municipal government's effort to build a Corporate Credit Information System. The warning system will include records held by all administrative departments of the Beijing Municipal government and judicial offices at all levels about the administrative punishments and criminal sanctions against companies as a result of severe violations of law. At the same time, the Beijing Municipal government will put restrictions on a company’s registration, outbound investment and administrative approval. The system applies to all companies which register through the Beijing Administration of Industry and Commerce and run business in the Beijing administrative area. Any of these companies which have misconducts including jeopardizing transaction security, disrupting the order of the market economy, or infringing on the legitimate interests of other dealers, will be included in the warning system and will become targets of special supervision by various administrative departments of the Beijing Municipal government. Since the information of the companies included in the credit warning system will be open to the public (through an official website, according to the People's Daily), people can check the credit condition of a certain company and decide, based on its credit, whether to do business with it. Baltimore, Here I Come If you are not going to the Eastern Association of Equipment Lessors or United Association of Equipment Leasing Joint Conference in Las Vegas, Nevada, you may want to consider this event: non-members are invited and encouraged to attend. The municipal and government leasing section is expanding in this economy. Here is an e-mail from Graham Hauck: AGL&F Conference Early Bird Registration Rate Extended to April 22! Register by the close of business on Monday, April 22 and as a member of AGL&F you will save $150.00, more than enough to help pay for your transportation to Baltimore. The Conference is at the Renaissance Harborplace Hotel - May 1-3. Details are on the Events/Meetings section of www.aglf.org or call 202.742.2453 and we can fax you the registration materials. We hope you join us..... Our Keynote Speaker is the Honorable Kurt Schmoke, the former Mayor of Baltimore and partner in AGL&F Member Firm - Wilmer, Cutler & Pickering. Mr. Schmoke is a Rhodes Scholar and during his tenure as Mayor of Baltimore, the city made a transition of monumental proportions, making Baltimore a model city in numerous ways. He will be a fascinating figure to listen to and one of the many inspiring aspects to our program for this conference. This is an opportunity you will not want to miss. Also, we are having our Thursday night networking and social event at Camden Yards - Home of the Baltimore Orioles who will take on the Kansas City Royals. We look forward to seeing you in Baltimore in just a couple of weeks, so don't delay - REGISTER TODAY! Graham Hauck Executive Director Association for Governmental Leasing and Finance 1255 23rd Street, NW Washington, DC 20037 202.742.AGLF (2453) fax: 202.833.3636 email: gsh@aglf.org Recruiters Are Misunderstood---Suggests a Feature Section Jonathan Zigman Address = 9990 Old Olive Street Road City = St. Louis State = MO Zipcode = 63141 Phone = 3149977010 Email = jonathan.zigman@csileasing.com Add me to the mailing list = yes
Leasing News has always been quite kind to the recruiting industry, and recent comments lead me to make a suggestion to take that one step further. Having been an independent recruiter servicing the leasing industry in the past, and currently the Director of Recruiting for a leasing company, I have long felt that the recruiting industry remains a mystery to most candidates and hiring authorities. How do recruiters work? What do they actually do? I think it would be a welcome subject for one of your e-mail forums. You could have a panel of a few of the recruiters who are listed in the classified section.... Just a thought. Thanks for the newsletter - I read it daily. Jonathan Zigman Director of Recruiting & Development Computer Sales International, Inc. BancPartners in the Great State of Texas Word on the street here is that the BancPartners affiliation in Texas has totally falling apart. What I heard yesterday is that the rest of the office has now quit and they have now hired a new rep to reopen the operation. This came from a pretty reliable source.
“ BancPartners of Texas,Inc. has legally changed its name back to Affiliated Corporate Services, Inc. A full press release of the details should be issued soon we are in the process of unwinding the merger with the BancPartners group. It is amicable and hope to have it finished by April 30. Will keep you posted. Jim Lahti Leasing News----“We Get Letters”
From: Michael Stulmaker <michael@mwleasing.net> Thank you - I very much enjoy starting my day with your newsletter. -- from Kathy McGurk : First, let me say that I always make a point to log on to www.leasingnews.org each week to keep up-to-date on industry news. I believe you are providing a real service to the dedicated professionals within our industry. You have demonstrated a willingness to "take on" tough issues. ------------------------ IRaymond@easternfunding.com Just wanted to say how much I like those show business trivia items especially the old TV shows that your dad wrote for (and I go back to radio too). Anyway, you mentioned one of my old favorites, Hans Conried and some of his credits. My memory isn't what it used to be, but didn't Hans also play Uncle Tonoose on the Danny Thomas Show and was also a guest on Mike Stokey's Pantomime Quiz in which Hans's knowledge of Shakespeare allowed him to come up with long Shakespearian quotes with only 2 or 3 words ( you are correct. editor) __ From: PAUL E HORGEN <paulhorgen@msn.com> Keep up the good work. I have to say that our subscription to Leasing News is worth every penny (More humor?) but seriously we have upgraded several infrastructure services and gained much specific knowledge thanks to you.
Thank You...and Best Wish's to you also...you are a breath of fresh air. Paul From: stsilva@msn.com Your newsletter is such a valuable source of industry information. I look forward to each morning's edition! I currently receive your newsletter at work, but no longer at my home email address which is: ******* Would you mind adding my second email? Sharon Silva ------------------------------------------------------------------------------------------------------------ #### ####################################################### Wells Fargo Reports Record Quarterly Earnings Per Share of $.80 SAN FRANCISCO--(BUSINESS WIRE)--April 16, 2002--Wells Fargo & Company (NYSE:WFC) First Quarter Highlights: -- Record diluted earnings per share of $.80(, up 19 percent from prior year's $.67 per share -- Record net income of $1.38 billion, up 18 percent from prior year's $1.17 billion -- Return on assets of 1.78 percent -- Return on equity of 20.01 percent -- Core revenue (excludes market-sensitive revenue and acquisitions) up 18 percent from prior year -- First improvement in credit quality since second quarter 2000 -- Net credit losses declined 9 percent from fourth quarter 2001 -- Non-performing assets flat compared with fourth quarter 2001 -- Average consumer cross-sell surpasses 4 products for the first time Note A: Earnings are before the effect of change in accounting principle. Under FAS 142, Goodwill and Other Intangible Assets, the Company was required to assess goodwill for impairment and to discontinue amortization of goodwill as of January 1, 2002. In the first quarter of 2002, the Company recorded a $276 million (after tax) transitional goodwill impairment charge as a cumulative effect of a change in accounting principle. per share of $.80 in the first quarter 2002, before the effect of an accounting change related to FAS 142, Goodwill and Other Intangible Assets (see Accounting Change -- FAS 142 Transition Adjustment), up 19 percent from prior year's $.67 diluted earnings per share. On the same basis, net income was a record $1.38 billion, up 18 percent from prior year's $1.17 billion. "Our 18 percent growth from first quarter 2001 in core revenue, which excludes market-sensitive revenue and acquisitions, continues to be among the best in any industry and demonstrates the ability of our 130,000 team members to partner effectively across our more than 70 businesses to earn more of our customers' business and provide them with great service," said Chairman and CEO Dick Kovacevich. "Our team members continue to prove that our strategy for market share growth works whether the economy is growing or in a recession. It's all about convincing customers to give us business they're already giving someone else. It's all about share of wallet. During the quarter, we surpassed four products per banking household for the first time in our company's 150-year history, and we're now more than halfway toward our ambitious goal of eight products per household. Also, according to SMR Research, Wells Fargo is now the number one home equity portfolio lender in the United States, with $28 billion in loans outstanding, growing 25 percent faster than the industry as a whole since the November 1998 Norwest-Wells Fargo merger. To commemorate our 150th anniversary on March 18, 2002, and to recognize and thank our team members for our continued market share growth and improved service quality, we awarded stock option grants for 150 shares of Wells Fargo stock to virtually all full-time team members, our fifth company-wide stock option award in seven years." Financial Performance With the adoption of FAS 142, effective January 1, 2002, amortization of goodwill is no longer in the income statement. In 2001, the Company incurred $144 million in the first quarter and $610 million for the full year in pretax expense for amortization of goodwill. Eliminating this expense would have increased net income in the first quarter of 2001 by $135 million ($.08 per share) and by $571 million ($.34 per share) for the full year. Comparisons below between 2002 and comparable periods in 2001 are presented as if goodwill amortization expense was excluded from 2001 periods. "We're very pleased with our financial performance in first quarter 2002," said Chief Financial Officer Howard Atkins. "Diluted earnings per share growth from $.75 per share in first quarter 2001 to $.80 per share in first quarter 2002 reflects an increase of more than $.09 per share in earnings from businesses other than market-sensitive activities and a decline in market-sensitive earnings from $.05 a year ago to under $.01 in the first quarter of 2002. Pretax market-sensitive revenue in first quarter 2002 was $18 million and was offset by $25 million in integration expenses, largely for the acquisitions of the Marquette banks and Texas Financial Bancorporation, which closed in February. We're also very pleased with the quality of the $.80 per share earnings which reflect another quarter of solid year-over-year core revenue growth, continued improvements in expense efficiency, and encouraging signs of credit quality improvement." Revenue Revenue of $5.96 billion for first quarter 2002 increased 14 percent from first quarter 2001. Excluding the effect of market-sensitive revenue and acquisitions, revenue for first quarter 2002 increased 18 percent from first quarter 2001. "Revenue growth from the first quarter of 2001 was driven by continued strong consumer loan growth, solid increases in consumer fee businesses, a higher net interest margin and good growth in core deposits," said Atkins. "On a sequential quarterly basis, the 6 percent annualized increase in revenue was due to those same growth factors, slightly dampened by flat investment management income due to the weak equity market, flat lending and loan-related transaction revenues in our commercial business in line with the first quarter economy, and typical first quarter seasonality." Loans Loans averaged $172 billion for first quarter 2002, up 8 percent over a year ago. Adjusting for acquisitions, average loans increased 6 percent from both a year ago and fourth quarter (on an annualized basis). "Commercial loans outstanding modestly declined in the first quarter in line with slow economic growth," said Atkins. "However, we are extremely pleased with the continued strong consumer loan growth largely driven by strong sales of our industry-leading home equity and home mortgage products." Consumer loans grew 17 percent annualized from December 31, 2001 to March 31, 2002. The Marquette banks and Texas Financial Bancorporation acquisitions completed during the first quarter added $3.5 billion of consumer and wholesale loans. Deposits Average core deposits of $178 billion for first quarter 2002 grew $21 billion, or 13 percent, since last year. After adjusting for acquisitions and money market sweep deposit accounts, core deposit growth was 7 percent. Average core deposits increased $2 billion, or 4 percent annualized, from fourth quarter 2001. "We are particularly pleased with growth of almost $2 billion in core consumer checking and savings balances since these accounts typically are the first of several products purchased by new households," said Atkins. Net Interest Income Net interest income on a taxable-equivalent basis was $3.68 billion in first quarter 2002, up 30 percent from the first quarter of last year, and up 6 percent from the fourth quarter of 2001. The increase in net interest income was driven by the growth in consumer loans and mortgage loans held for sale, good core deposit growth and a higher net interest margin -- 5.67 percent in first quarter 2002, compared with 5.50 percent in fourth quarter 2001 and 5.21 percent in first |