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March 6, 2001
Headlines: Sierra Cities-Amex Merger Gets Green Light Flex-Leasing Moving---- Securitization Industry Watches LTV Bankruptcy Case Very Closely NAELB--ListServe UAEL Spring Conference NCR Takes It in ATM Losses CIT Predicts Second Quarter Not Good, but Third Quarter--Maybe Re-bound Charter One Launches Free Wireless Banking Tomorrow--Wednesday Linda Kester "Surviving a Recession". Written especially for our readers in the leasing industry.
The main points will be: diversification, how funders tighten credit selectively, and how to take advantage of select opportunities. Look for it tomorrow!!!
----------------------------------------------- Flex-Leasing, Alburquerque, New Mexico Rumors that Chuck Griffin has been selling his office furniture and equipment are true. He says he does not need his large office, as he is merging with another company. A formal announcement will be made soon. -------------------------------------------------------------------------------------------- U.S. Capital, Santa Barbara, California\ More complaints from brokers all over the United States about Advance Rentals or deals not being funded. One today from New Jersey says it is over $25,000 and site inspections were completed, too. Everyone wants to know what is going on. --------------------------------------------------------------------------------------- Terminal Marketing Company, New City, NY More complaints about this company, and we are continuing to look into it. The only reason I bring this to readers attention is the number of complaints is close to a dozen or more, so this gives more credence to the complaints. If you have any information that we can verify, on this company, please let us know. --------------------------------------------------------------------------------------------- We encourage you to send to a colleague. You may quote any or part of anything we have here or on line without our permission. We encourage you to communicate with your colleagues about us or anything that appears here. editor --------------------------------------------------------------------------------------------- Sierra Cities-Amex Merger Gets Green Light American Express Company announced that it received notification of the early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 applicable to American Express Travel Related Services Company's $5.68 per share cash tender offer for all outstanding shares of common stock of SierraCities.com. The expiration or early termination of that waiting period was one of the conditions to completion of the tender offer. The tender offer commenced on February 27, 2001 and is scheduled to expire at 12:00 midnight, New York City time, on Monday, March 26, 2001, unless extended, and is subject to certain other conditions. On February 14, 2001, American Express and SierraCities.com announced the signing of a definitive agreement for American Express Travel Related Services Company to acquire SierraCities, a leading equipment finance company. ------------------------------------------------------------------------------------------- Spring Conference--United Association of Equipment Leasing The UAEL Spring Education Conference will be held at the Doubletree Paradise Valley Resort in Scottsdale, Arizona May 3rd through 6th. Keep an eye on your mailbox for your brochure but don't wait to make your room reservations!! Call 480-947-5400 and ask for the UAEL group rate.
Following are highlights of the conference:
Thursday - May 3 Golf Tournament CLP Review presented by UAEL's Institute for Leasing Professionals First Timer's Reception Welcome Reception
Friday - May 4 Opening General Session with Roger Dawon, "The Power of Negotiation" Luncheon Speaker is Phoenix Economist, Elliott Pollack Afternoon sessions include Sudhir Amembal and Bob Baker, CLP
Saturday - May 5 General Session with DJ Harrington, "Building Relationships" Recognition Luncheon Afternoon educational sessions Earn your CLP continuing education credits by attending accredited sessions Wild Wild West Dinner and Hoe-down at Rawhide!
Sunday - May 6 CLP Exam - pre-registration required through the CLP Foundation
For additional information and sponsorship opportunities please contact the UAEL office. Joanie Dalton - Managing Director UAEL - United Association of Equipment Leasing 520 Third Street, #201 Oakland, CA 94607 (510) 444-9235 x27 * Fax (510) 444-1346 joanie@uael.org * www.uael.org ------------------------------------------------------------------------------------------ List Serve
National Association of Lease Brokers Members write us to let us know their "List Serve" is an "outstanding member benefit." They state, "...because its no time to go it alone.!" Right now 1/2 of the NAELB membership is using this service. Along with the promotion of the New Orleans Conference in May, this service is being promoted. A fax is being sent to all the members: 1. have you ever needed to find a funding source? 2. Would you like to be alerted to the latest fraud schemes? 3. Have you ever struggled with documentation, pricing or strLicture of a lease? 4. Would new ideas oil management, employee compensation, etc. be helpful? 5. Do you like keeping in touch with NAELB members? If you answered "yes" to one or more of the above ... You Need to subscribe to the NAELB List Serve! There are many seasoned brokers that are ready, willing and able to answer your questions! Its like having an NAELB Conference at your fingertips each and everyday. If you are a current member of NAELB and would like to access the List Serve, simply follow the directions below: 1. Log onto WWW.NAELB.ORG 2. Click on the "Members" section 3. Type in your User ID and Password 4. Click "Submit" 5. Click "Discussion List" 6. Click "To Subscribe: send e-mail to imailsrv@naelb.org or 7. Type the following in the text box (largest box) . subscribe post your name 8. You are now entered and ready to post & receive List Serve messages. If you are not a current NAELH member or have forgotten your User ID and/or Password, please call NAELB Headquarters at 1-800-996-2352. -------------------------------------------------------------------------------------------- Securitisation Industry Watches LTV Bankruptcy Case Very Closely In good times in securitization industry, a "true sale" opinion from the lawyers might only mean days spent on lengthy legal conferences, a one-inch thick securitization document, and finally, a big hole in the pocket on account of legal fees. But once in a while, bankruptcy of the originator could expose a seldom thought-of question : was the sale of cashflows from the originator to the SPV a sale in fact? While a US bankruptcy court is currently seized of this issue, the entire securitisation industry is watching the proceedingly anxiously. The case in point is the bankruptcy of LTV Corporation. LTV, a Ohio-based steel company, filed for protection under Chapter 11 on 29th December last year. The bankruptcy court allowed LTV to use its receivables to maintain its staff payments, etc. However, this is where Abbey National stepped in - contending that LTV had no right to the cash flows, as the same had already been securitized. Way back in 1994, LTV had transferred, on a revolving basis, receivables to its SPV called LTV Sales Finance Co., and Abby had bought interest in such receivables. LTV's lawyers contended that the sale of receivables by LTV is nothing but a disguised financing. Even as the hearings go, the securitization industry is worried. Revealing the worry is the fact that several concerned parties, including Bond Market Association, MBNA Corp., GE Capital Corp., Residential Funding Corp. and the Consumer Mortgage Coalition have prayed before the Court to be included as amicus curae and have pleaded that the true sale character of the receivables should not be disturbed. The list of those pleading to be included as amicus curae runs to 23 top names in the securitization industry, represented by Mayer Brown and Platt. Mayer Brown and Platt emphasize that securitization is based on century-old concepts of absolute transfers among affiliated entities and corporate separateness that have been long recognized under federal bankruptcy law, that securitization has become a $5.9 trillion market, benefitting all segments of the U.S. economy (including locally important segments such as the auto industry), that securitization transactions have been routinely respected in other bankruptcy cases, and that accepting LTV's frontal attack on securitization could cause a seismic disruption of the financial markets. There have been cases in the past where purported securitization or receivables transfer agreements have been characterized as loans: the issue depends almost entirely on the facts and the strength of documentation. The case is scheduled for hearing on 7th March. On this site, we will be covering further developments in this case. In yet another unrelated development, US airline company TWA filed for Chapter 11 protection in Jan. this year. TWA has originated several securitizations in the past, and is the obligor for several other aviation related securitizations. There are as many as 7 operating leases to TWA that have been securitized by the respective lessors. Rating agencies do not expect much problem for operating lease securitizations, as the leases, if canceled, can only result into release of the aircraft to the lessor which can be redeployed. But the bigger problem is for future ticket sales deals securitized by TWA. This is a ticket sale securitization through Constellation Finance LLC Series 1997-1. This deal, worth around $100m, was rated BB and sold in December 1997 and is collateralized by ticket sales being paid by specified credit cards. The deal does have a cash reserve, and fast amortization trigger, but quite possibly, will be affected by the bankruptcy. No airline originated deal has defaulted in the past, according to this report. ------------------------------------------------------------------------------------------------- Archives http://www.leasingnews.org/archives.htm For those who use our "free" archives, for back issues, if you want stories about U.S. Capital, please spell it out. I have been told by many readers they can't find it, and in researching it, they are doing the search as US Capital. Is is U.S. Capital. editor ------------------------------------------------------------------------------------ NCR Anticipates Charge Related to ATM Equipment Distributor
DAYTON, Ohio, March 6 /PRNewswire/ -- NCR Corporation (NYSE: NCR) today announced that the company anticipates it will take a charge of approximately $42 million for loans and receivables related to prior business with Credit Card Center (CCC), a leading distributor of ATM equipment into the U.S. small retailer marketplace. The anticipated charge would impact NCR's first quarter 2001 earnings by approximately $28 million after tax. Because of the strength and growth of its ATM business in the European and Asian markets, NCR does not currently believe that, apart from this anticipated charge, there will be any material revenue or earnings impact to the Financial Self Service business, or to the overall company, for the year 2001. There is no other change in the previous guidance provided in the company's year-end earnings announcement of January 23, 2001. During 2000, NCR entered into a preferred provider relationship with CCC for entry-level ATM machines. As part of this agreement, NCR provided $16 million of financing, primarily to support infrastructure investments by CCC. Driven by a strong market and a unique business model, CCC's growth has outpaced its capital and management resources. In the last few weeks the firm has had significant challenges in obtaining adequate lease financing and has experienced cash flow problems with a sharp drop off in new and existing customers. While NCR has worked with CCC to develop stronger customer leasing support and a more stable capital structure, within the last week, CCC's ability to satisfy its financial obligations to NCR has become a significant concern to the company. Although the company will continue to work closely with CCC to successfully resolve this issue, NCR anticipates that it will take a charge for the full amount of CCC's obligations to NCR. Chief Financial Officer David Bearman will host a conference call today at 9:00 a.m. (ET). The dial-in number for the call is (312) 470-7365, passcode 3290909. Access is also available from NCR's Website at http://www.ncr.com/investors/invest-rel.htm . A replay is accessible by calling (402) 998-0868 beginning at 10:00 a.m. (ET) today until 5:00 p.m. (ET) on March 9, 2001. About NCR Corporation NCR Corporation (NYSE: NCR) is a leader in providing Relationship Technology(TM) solutions to customers worldwide in the retail, financial, communications, manufacturing, travel and transportation, and insurance markets. NCR's Relationship Technology solutions include privacy-enabled Teradata(R) warehouses and customer relationship management (CRM) applications, store automation and automated teller machines (ATMs). The company's business solutions are built on the foundation of its long- established industry knowledge and consulting expertise, value-adding software, global customer support services, a complete line of consumable and media products, and leading edge hardware technology. NCR employs 32,900 in more than 100 countries, and is a component stock of the Standard & Poor's 500 Index. More information about NCR and its solutions may be found at www.ncr.com . NCR and Teradata are trademarks or registered trademarks of NCR Corporation in the United States and other countries. Note to Investors: This news release contains forward-looking statements, including statements as to anticipated or expected results, beliefs, opinions, and future financial performance. These forward-looking statements include projecting revenue and profit growth, and statements expressing comfort with analysts' earnings estimates. These forward-looking statements are based on current expectations and assumptions and involve risks and uncertainties that could cause NCR's actual results to differ materially. In addition to the factors discussed in this release, other risks and uncertainties include: the timely development, production or acquisition, and market acceptance of new and existing products and services; shifts in market demands; continued competitive factors and pricing pressures; short product- cycles and rapidly changing technologies; turnover of workforce and the ability to attract and retain skilled employees; tax rates; ability to execute the company's business plan; general economic and business conditions; and other factors detailed from time to time in the company's Securities and Exchange Commission reports and the company's annual reports to stockholders. The Company does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. SOURCE NCR Corporation CO: NCR Corporation; Credit Card Center -------------------------------------------------------------------------------------------- CIT Predicts the Economy---down second, up Third quarter CIT's Third Annual Retail Outlook 2001 Predicts Rebound in Consumer Spending; Despite Continued Economic Slowdown, Recovery Expected in Second Half of 2001
NEW YORK--(BUSINESS WIRE)--March 6, 2001--Retail sales will see a rebound in the second half of the year despite the continued economic slowdown, according to CIT's Third Annual Retail Outlook released today. Nominal retail sales (excluding autos) should see average increases of above 5.0 percent over the next two years, down from an 8.0 percent range achieved in recent years, according to CIT (NYSE:CIT; TSE:CIT.U), a leading global source of financing and leasing capital. "The latest consumer confidence figures, a drop to its lowest level in more than four and a half years, support our latest forecast for the retail industry," said Lawrence A. Marsiello, CEO of Commercial Finance, an operating group of CIT. "We believe that any intervention on the part of the Federal Reserve, which has clearly indicated its will to combat the economic slowdown, will revive consumer confidence and contribute to a retailing rebound in the second half of 2001," added Marsiello. Last year proved to be quite challenging for the retail industry. Household wealth dropped nearly $2 trillion from March through December of 2000, leaving a notable dent in the wealth effect, which had allowed consumers to forego savings, freely accumulate debt, and increase consumption. The sudden plunge in the University of Michigan Consumer Confidence Index from 108 in November to 98 in December certainly reflects the unfortunate peak in consumer pessimism, according to the Outlook. Holiday sales in 2000 were a solid 4.5 percent above the 1999 season, and for the year, the giant industry did manage robust gains reaching a record $2.43 trillion (excluding cars and auto parts) based on a U.S. Department of Commerce report. Estimated nominal sales rose nearly 8.1 percent, just as strong as 1999's 8.2 percent increase, with non-durable sales growing 8.9 percent and durables up 5.7 percent in 2000. Excluding gas service stations (to adjust for the unusual rise in petroleum prices) estimated total sales were up 7.1 percent and non-durables showed a 7.7 percent annual increase in 2000. Going forward, according to the Outlook, the retail industry should expect to see sedate activity over the next several months, before experiencing a rebound propelled by lower interest rates and further clarity on pending tax cuts. The increase in sales in the post-Christmas period was attributed mostly to deep post-Christmas discounts and the reported large number of gift certificates purchased during the holiday season, reducing unwanted inventory. "If passed, President Bush's proposed $1.6 trillion tax cut could give consumer spending an additional boost," said Marsiello. "However, funds from lower taxes will not be available before mid-year and actual tax cuts will most likely be scaled back given a split Congress and voiced opposition from Democrats. Nonetheless, any tax relief will bring more disposable income and significantly increase consumer spending," added Marsiello. Fierce competition and lack of pricing power have been damaging to a few of the nation's large department stores, although some have certainly fared better than others. Luxury department stores have been largely insulated due to loyalty from upper-scale consumers who are attracted to brand and private labels as well as their high value appeal. The Online Store According to the Gartner Group, nearly 25 million people purchased holiday gifts over the Internet in 2000, spending nearly $12.4 billion in November and December according to the National Retail Federation. Based on the Census Bureau's e-commerce survey, online estimated retail sales in the fourth quarter of 2000 were nearly 23 percent above 1999's last quarter sales. Categories such as books, music, toys, and PC products continue to see the most significant increases. "The exact formula for success in the online world has so far been elusive for many merchants," said Marsiello. "Brand recognition appears to be important and customers feel comfortable buying online from an establishment that also has a physical presence. In the coming years we think that the Internet will serve as a complimentary distribution channel for well established retailers rather than a competing shopping venue," added Marsiello. About CIT CIT is a leading, global source of financing and leasing capital for companies in more than 30 industries. Managing more than $50 billion in assets across a diversified portfolio, CIT is the trusted financial engine empowering many of today's industry leaders and emerging businesses, offering vendor, equipment, commercial, factoring, consumer and structured financing capabilities. Founded in 1908, CIT operates extensively in the United States and Canada with strategic locations in Europe, Latin and South America, and the Pacific Rim. For more information on CIT, visit the Web site at www.cit.com. CONTACT: CIT Ann-Margret Crater, 212/536-9310 ann.crater@cit.com or Stanton Crenshaw, for CIT Naya Kolarova, 212/780-1900 naya@stanton-crenshaw.com KEYWORD: NEW YORK ----------------------------------------------------------------------------------------- Charter One Launches Free Wireless Banking
CLEVELAND, March 6 /PRNewswire/ -- Charter One Financial, Inc. (NYSE: CF) announced today that it has launched its free wireless banking service, becoming one of the first banks in the nation to enable its customers to access their accounts from anywhere in the world using their mobile phones. Charter One's wireless banking service is available to registered users of its totally free online banking and bill payment service, which has already enrolled over 42,000 people since its December 2000 launch. Enrolled Charter One wireless customers can gain secure access to their accounts from most web- enabled mobile phones by visiting www.cobwireless.com from their phone browsers. "It is important for Charter One to not only be where our customers are, but where they will be," said Mike Dobbins, senior vice president, Charter One. "Our goal in being one of the first banks to offer our customers free wireless account service is simple: to make sure anyone through any channel can take advantage of our superior products and services." Among other features, Charter One's free wireless banking service will allow customers to see all of their account balances, review the last 10 transactions per account, transfer funds between accounts in real time and contact customer support via a "speed dial" option. Charter One will add bill payment functions to its service later this year. "Charter One's inclusion of wireless support as part of an integrated 'e banking' offering places them in the forefront of mobile banking," said Richard J. Bell, director of e banking for the TowerGroup, a consulting firm which specializes in the impact and direction of technology within the financial services industry. "By not forcing a relationship with specific wireless carriers, their service can be used by many more of their customers using a variety of existing and future mobile devices." Jupiter Research, a leading Internet market research firm, recently projected that 18 million more people in the United States will become wireless subscribers in 2001, bringing the total number of wireless subscribers in the nation to 128 million. Jupiter also projected that the percentage of subscribers with Internet-ready wireless handsets will quadruple during 2001. "The introduction of our online capabilities has been extremely well received by Charter One customers," said Mark Grossi, Charter One's executive vice president of retail banking. "Our new site has only been live for less than 80 days, yet we already have over 42,000 enrolled users and have taken over $150 million in new online loan and deposit applications. Free wireless services are the next logical step in our efforts to keep our product offerings fresh and exciting to current and potential customers of the bank." Charter One has approximately $33 billion in total assets, making it one of the 30 largest bank holding companies in the country. The Bank has approximately 420 branch locations in Ohio, Michigan, New York, Illinois, Massachusetts, and Vermont. The branch locations operate under the Charter One name in all areas except Michigan (First Federal of Michigan). The Company's diverse product set includes: consumer banking, indirect auto finance, commercial leasing, business lending, commercial real estate lending, mortgage banking, and retail investment products. For additional information, including press releases and investor presentations, investors are directed to Charter One's web site: www.charterone.com . SOURCE Charter One Financial, Inc. CO: Charter One Financial, Inc. |
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