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Trinity Capital, a subsidiary of Bank of the West, is a national leader in the equipment financing industry with a consistent presence and superior reputation. |
Wednesday,
October 13, 2004
Headlines---
Pictures
from the Past---Winter, 1998
Archives—
Oct 12,2000—Fitch Revises Orix to “Negative”
“This Day in American
History”
What
Lessors Are Saying About…The IT Equipment Leasing Market
AmSouth
Bank Makes Settlement with Legal Authorities
Universal
Express $225M Equipment Trust Certificates
Fitch
Places Bombardier on Rating Watch Negative
Fitch:
U.S. Public Finance Credit Dips 3rd Q 2004
Robbins
Joins Republic's Aviation & Portfolio Group
######## surrounding the article denotes it is a “press
release”
---------------------------------------------------------------------------
Classified
Ads---Operations
Orange County, CA.
Operations/Credit Manager with 15 Years Experience, Middle & Large Ticket, initiated policies for Patriot Act and Sarbanes Oxley, Team Motivator.
E-mail: equiplender@aol.com
Experienced Credit, Collections, lease and Finance operations. Manager w/expertise in improving bottom line performance, excellent trainer, manager, motivator. Get result/keep the customer coming back.
Email: rgmorrill@comcast.net
New York, NY.
10+ years in equipment
leasing/secured lending. Skilled in management & training, documentation,
policy and procedure development & implementation, portfolio reporting.
Strong work ethic.
Email: dln1031@nyc.rr.com
New York/New Jersey
5+ years experience in leasing. Knowledge of positions: SMB Credit and Contract Administrator. Relocating to the NY/NJ area.
Email: LeaseOps2004@AOL.com
Wayne, NJ
20+ heavily experienced collection/recovery VP looking to improve someone's bottom line. Proven, verifiable track record. Knowledge of all types of portfolio. Will relocate
Email: cmate@nac.net
West Palm Beach,
FL.
Sales, credit, presentation
and placement. Seasoned lease professional, currently independent, looking
for a manufacturer,
Email: southernleasing@bellsouth.net
92 “Help” Wanted ads at:
http://64.125.68.90/LeasingNews/JobPostings.htm
---------------------------------------------------------------------------
Economic
Events This Week
October 13
Today
Presidential Debate
October 14
Thursday
Balance of Trade:
August
Weekly Jobless Claims
October 15
Friday
Capacity Utilization:
September
Industrial Production:
September
Inventory-Sales Ratio:
August
Producer Price Index:
September
Retail Sales: September
( Leasing News thanks
Mr. D. Paul Nibarger, CLP,
Nibarger Associates Rancho Palos Verdes, California
for contributing
his collection of past leasing association
and convention magazines
and material.
“I joined WAEL as
Nibarger Associates in 1986 as a favor to Ted Parker who was President
that year. I had been with the old United California Bank/First
Interstate Bank from 1971-1983. Ted
and I were Unit Managers. He
ran the middle market for everything outside of California and I ran
the large ticket, over $5MM, group.
I think the Bank joined WAEL in 1974 or 75 but I don't have any
of the older WAEL material.
“In the process of looking, I found about 10 ea. "banker
boxes" of old WAEL/UAEL, AAEL/ELA material and other assorted leasing
related articles, magazines etc. My
wife thinks I'm nuts to keep all of this stuff and wants me to throw
it out. Awhile back you made
an offer to pay shipping for old material.
Let me know if you want this material”.
As Stan Laurel would
say, “ It cert-tain-lee Is.”
This is the signature
to his e-mail:
“Nibarger Associates
is an investment banking firm which provides corporate finance advisory
services in mergers, acquisitions and divestitures of public and privately
held business. The firm has
a strong specialty in meeting the intermediate and long term financing
needs of its clients through equipment financing and leasing.
We also provide a strong commercial collection and investigation
service for our clients. We
are members of ELA, UAEL and NAELB with a CA Finance Lender/Broker license,
# 603-8622”
With Mr. Nibarger’s contribution, we not only have reference material,
but the ability to
go back to:
Pictures
from the Past---Winter, 1998
Regional
Holiday Meeting San Francisco
Susan Shumway, SSA
Capital, is pleased to received one of the
many door prices
given out by United Association of Equipment Leasing President-elect,
George J. Davis, CLP, Fortune Financial
Winter 1998 UAEL
Newsline Quarterly Journal
Steve Crane is Conference
Chair of the Monterey Conference.
|
|
-----------------------------------------------------------------------------
Archives—
Oct 12,2000—Fitch Revises Orix to “Negative”
##
Press Release #############################
ORIX
Credit Alliance Inc.'s Ratings "affirmed"; Outlook Revised
To Negative
(This
is a Press Release from Fitch )
NEW
YORK--(BUSINESS WIRE)--Oct. 12, 2000--ORIX Credit Alliance,Inc.'s (Credit
Alliance) long- and short-term debt ratings are affirmed at 'BBB+' and
'F2', respectively, by Fitch. The long-term Outlook has been revised
from Stable to Negative. Credit Alliance's ratings reflect the company's
good risk-adjusted capitalization, appropriate funding strategy, and
long operating history with consistent performance. Additionally, the
ratings consider the covenant protection provided by the company's bank
facilities and private placement loan agreements. Rating concerns center
on Credit Alliance's weakening asset quality and profitability measures,
its size relative to key competitors, the heightened competitive environment
in the commercial finance industry, and exposure to economically cyclical
industries. Approximately $2.1 billion of securities are affected by
this rating action.
Credit
Alliance announced today that it has changed its name to ORIX Financial
Services, Inc. (OFS). OFS will serve as holding company to its three
business groups: Equipment Finance, Business Credit, and the newly formed
Structured Finance group.
Historical underpinnings of the Credit Alliance ratings have been the company's conservative management, steady operating performance, and well-defined business model. However, in recent years, these strengths have been challenged by the increasingly competitive landscape within the commercial finance industry, resulting in weakening asset quality and reduced profitability. In an effort to regain operating momentum and improve its competitive position within the industry, Credit Alliance has made several significant changes over the past
18
months.
During
this period, the company consolidated its distribution network, re-assessed
its commitment to several industries and businesses, and appointed a
new chief executive officer. Credit Alliance will focus on diversifying
the business as well as improving the company's market position in its
core market over the near-term. As part of this strategy, the company
will strive to diversify its receivable base by investing in additional
equipment types/industries; develop a structured finance business that
will focus on larger transactions; establish a syndication capability;
extend its asset management expertise; and emphasize higher margin direct
originations.
Nevertheless,
continued weakness in asset quality and profitability measures coupled
with execution risk related to the company's aforementioned near-term
strategic objectives has caused Credit Alliance's Rating Outlook to
be revised from Stable to Negative.
In
recent years, Credit Alliance's asset quality measures have steadily
weakened due to recessions in several of the cyclical industries it
finances as well as a problem small-ticket leasing portfolio purchased
from Bankvest Capital Corp. Credit quality was also negatively impacted
by the company's 1999 branch consolidation...
Full press release at:
http://two.leasingnews.org/archives/October/10-12-00.htm
Current stories on
Orix are available:
http://www.leasingnews.org/Conscious-Top%20Stories/Orix.htm
### Press Release
##########################
---------------------------------------------------------------------------
 |
----------------------------------------------------------------------------
Where
are the Duffy’s?
“Do know what’s going on with Summit National…the
software vendor? I tried to
call & got a recording saying something like the number is not operable…
I then went to their web site & it was gone!
Have they been acquired???”
(name with held )
Both father and son,
Ken Duffy and Ken Duffy,Jr. e-mail came
back, plus their
web site is no longer available.
At one time they
were active participants with investors in attempting to purchase International
Decision Systems in competition with CapitalStream. Anyone with knowledge about their status, please
contact: kitmenkin@leasingnews.org
-------------------------------------------------------------------------------
“This Day in American History”
----Now On Line by Date
This feature first started off as a signature to e-mail. It has evolved
from celebration of birthdays to celebration of American events in
history. The project is a
collaboration of Steve Chan, Brian Wong and
Maria Martinez-Wong, who transformed the feature now available
by date.
Days will be up-dated annually.
Any missing days will hopefully
be completed in the next twelve months.
http://www.leasingnews.org/American_History/default.htm
-------------------------------------------------------------------------------
Dash
of the Kuwait Coast
My son Dash ( short for Dashiell ) is in the front row, in the middle.
While he is primarily a top electrician, among other duties on the Arleigh Burke destroyer USS Preble,
such as manning light machine guns, diving as second class diver,
he is part of the “boarding party” that guards the Abot Oil Refinery. They do random checking of all vessels in the
area, particularly looking for terrorists or bombs for docks, the oil
refinery itself, or military locations or ships along the coastal area.
They board the vessels
with light weapons, searching cargo holds and
all quarters. He says it is often 130 degrees and very humid.
They
drink a lot of water
and go through sun screen like crazy.
I do send
him “care packages,”
which take about two weeks to reach him with
the sun screen he
likes, Clif bars which he devours in all flavors,
and other surprises. He does have access from time to time to
the internet. He says he knows nothing about what is happening
in the “states.” Many of the crew who were to be there six months
will be going in
over a year and they work all the time, many shifts,
in combat ready, as they are in war zone.
He says they are all “proud to be an American.”
I can tell you from
his e-mail he is “gung ho,” as
we used to say in
the Army. He never complains
about the work,
and likes to volunteer
for assignments and other duties. He
is a lot
like his father,
who likes to be busy, doing something.
I am very
proud of him.
Kit
Menkin
Classified
Ads---Leasing News
Brokers
|
About the company: SCL has been in business for 12 years. We are contracted with multiple funding sources which enables us to provide more competitive rates and flexible terms and conditions. |
Funding/Loan Processor
|
CFO / Leasing Sales Leader
|
Dealer Credit Finance Analyst / Dealer Credit Finance Services Supervisor
|
Dealer Credit Fin. Services Supervisor, Torrance, CA. Click here for full descrip. & to apply. To learn more about us, please visit: www.toyotafinancial.com/careers |
National Account Manager
|
Trinity Capital, a subsidiary of Bank of the West, is a national leader in the equipment financing industry with a consistent presence and superior reputation. |
Vendor Account Executive
|
About the Company: Lease Corporation of America is a well established, 16 year old, national equipment leasing company. |
What
Lessors Are Saying About…The IT Equipment Leasing Market
ELTnews
The Equipment Leasing
Association released the study by R.S. Carmichael & Co., Inc., Information
Technology Equipment Leasing: U.S. Market Dynamics and Outlook in July
2003. Among the study findings were a projected turnaround in 2003,
and a predicted market level of $28 billion by 2005, representing a
6.5 percent average annual rate of growth over the 2003-2005 period.
ELA wanted to revisit the IT equipment leasing market and ask lessors
how the market has performed since the IT study was published.
John Gougeon, USXL,
said his firm has seen a steady migration to bundled soft costs, including
software, installation and maintenance, in the business they are writing
currently. He said, “While we have seen a trend in IT spending, the
floodgates have not re-opened in capital spending. We are anticipating
a strong fourth quarter, as businesses close out the buying cycle.”
From a risk perspective, USXL is still fairly bullish on the strength
of the IT aftermarket, maintaining residual positions on a year-over-year
basis.
Tom Ellis, CitiCapital
Office Technology Solutions Group, said, "We saw a lift in overall
IT equipment spending starting in 2004, although that's started to tail
off in the second half of the year. We expect 2005 to start out soft,
especially among software companies.”
Ellis noted that
one significant and continuing trend among mid-to large sized businesses
acquiring IT equipment is an increased use of cash, and a correspondingly
decreased use of leasing. He said this is a reflection of the generally
strong cash position of mid-tier companies.
Another trend he
noted is an increased propensity to select fixed purchase option leases,
versus fair market value leases. Ellis said, “Companies have confidence
that the technology will be used for a greater period of time, due to
longer useful equipment life and less rapid obsolescence. We expect
this trend to continue as well.”
Ellis added, “Since
the beginning of 2004, IT manufacturers have pushed to increase sales,
relying on their captives to drive volume through aggressive pricing.
As a result, we've seen a compression in leasing margins."
Loni Lowder, ACC
Capital Corporation, said that ACC’s IT transactions were relatively
flat for the past six months. He said, “The IT portion of our portfolio
remains constant at about 20 percent.” Affirming other observations
about the use of cash for IT equipment acquisition, Lowder said, “Fiscal
and monetary policy during the last few years has created high amounts
of cash reserves within corporate America. Low interest rates and bonus
depreciation have allowed firms to pay cash for much of their IT needs.”
He added that a number of IT industry advisors have been recommending
that companies buy their IT equipment as opposed to
utilizing leasing.
Lowder believes that
it is very likely that these fundamentals will change over the next
year with bonus depreciation expiring and interest rates rising. He
said, “To combat the current trend we are introducing a new application-only
program for 100 percent software leases up to $100,000, and we are doing
a lot of lease vs. cash present value after-tax sensitivity analysis
for our customers.”
Nick Whittemore,
De Lage Landen Financial Services, said that overall the recent technology
finance market has been stable. Whittemore said, “Many companies’ revenues
have flat-lined across the board, remaining literally the same for three
years while select, better-run companies have been experiencing healthy
30 percent returns.” He noted that due to a large marketplace correction
that occurred three to six years ago, many weaker companies were weeded
out of the industry and disappeared, leaving today’s market with companies
that are either stable or improving while experiencing minimal fallout
or attrition.
Whittemore said that
although the outlook was bleak for 2002 and 2003, the 2004 leasing industry
is showing signs of encouragement in the small and medium ticket market.
“Many lessors believe that competitive pressures will lead to further
consolidation and a decreasing number of lessors over the next three
years,” he said. “Big-ticket lessors are showing signs of concern over
proposed legal and regulatory changes that are having a stifling impact
on leasing volume even before they become effective.”
Whittemore’s comments
on soft costs seemed to concur with John Gougeon’s, noting that transactions
involving soft costs and services are evolving as a trend affecting
the industry, up from 25 percent to 65 percent, making up a greater
percentage of today’s typical transaction. Whittemore also noted that
as functionality of products broadens, the blurring of SIC codes can
be looked at as another example of an emerging trend.
### Press Release
#########################
AmSouth Enters into Agreements with U.S. Attorney in Mississippi,
Federal Reserve and FinCEN
BIRMINGHAM, Ala.--( ----AmSouth Bancorporation (NYSE:ASO)
announced today that it and AmSouth Bank have entered into a deferred
prosecution agreement with the U.S. Attorney for the Southern District
of Mississippi relating to deficiencies in the bank's reporting of suspicious
activities under the Bank Secrecy Act. The matter initially arose out
of a previously disclosed fraudulent note scheme committed by two bank
customers, Louis Hamric and Victor Nance, beginning in 2000, but was
subsequently expanded to include certain other specific matters, including
AmSouth's general policies and procedures for Bank Secrecy Act compliance.
AmSouth has also entered into a cease and desist order with the Federal
Reserve and the Alabama Department of Banking, and an order with FinCEN
relating to deficiencies in AmSouth's compliance with the Bank Secrecy
Act.
Under the agreement with the U.S. Attorney, acting on behalf of the
Department of Justice, AmSouth has agreed to make a payment of $40 million
to the United States. In connection with the Federal Reserve and FinCEN
orders, AmSouth has been assessed a civil money penalty in the amount
of $10 million. Additionally, as a result of these settlements, AmSouth
will incur pretax costs of $4 million in professional and other related
fees in the third quarter.
AmSouth is committed to full compliance with the provisions of these
agreements. Provided AmSouth complies with its obligations under the
deferred prosecution agreement for a period of 12 months, the U.S. Attorney
has agreed not to take further action against the company in connection
with this matter. With respect to the cease and desist order, the Federal
Reserve has indicated it will restrict the company's expansion activities
until such time as it believes the company is in substantial compliance
with the requirements of the order.
As part of the agreements, AmSouth has agreed to take additional actions
to ensure compliance with the Bank Secrecy Act, including independent
third-party reviews of its activities, enhanced training of personnel,
submission of written plans, and adoption of approved policies and procedures.
C. Dowd Ritter, AmSouth's Chairman, President and Chief Executive Officer,
said, "AmSouth is committed to meeting the highest standards in
all aspects of its business. This is an obligation we take extremely
seriously. We have already taken a number of remedial actions, and are
committed to taking further actions, to ensure we are appropriately
responding to the bank's obligations. AmSouth is a strong regional bank
with a solid financial foundation, and we look forward to continuing
to meet the needs of our customers and deliver value to our shareholders
while meeting the highest standards of compliance."
At the time Hamric and Nance committed the fraud, Hamric was a practicing
attorney and Nance was a registered representative for a broker-dealer
affiliate of a national life insurance company. Beginning in 2000, Hamric
and Nance opened custody accounts at AmSouth Bank to hold fraudulent
notes issued by Hamric. In 2002 Hamric defaulted on promissory notes
issued to over 40 of their clients, triggering a number of civil lawsuits
against individuals and institutions, including Nance's former employer
and AmSouth. AmSouth, together with Nance's former employer, has settled
virtually all of these matters for amounts in excess of the principal
investment. Hamric, Nance and other individuals connected with them
pled guilty to criminal charges relating to the scheme in 2003.
AmSouth has filed the deferred prosecution agreement and the orders
on Form 8-K, which is available at the company's Investor Relations
Resource Center, www.amsouth.com/irrc and on the Securities and Exchange
Commission's website, www.sec.gov.
Questions and Answers Regarding AmSouth's Settlements
WHAT ARE BANKS' OBLIGATIONS TO DETECT AND REPORT SUSPICIOUS ACTIVITIES?
Under the Bank Secrecy Act, financial institutions are obligated to
file Suspicious Activity Reports, or SARs, on suspicious activities
involving the institution, including certain attempted or actual violations
of law as well as certain transactions that do not appear to have a
lawful business purpose or are not the sort of transaction in which
the particular customer would normally be expected to engage.
WHAT IS A SUSPICIOUS ACTIVITY REPORT?
For information on Suspicious Activity Reports and the requirements
for filing them, please refer to FinCEN's website: www.fincen.gov.
WHAT IS FinCEN?
The Financial Crimes Enforcement Network is an agency of the U.S. Treasury
Department whose mission is to support law enforcement investigative
efforts and foster interagency and global cooperation against domestic
and international financial crimes.
WHAT IS THE BANK SECRECY ACT?
The Bank Secrecy Act is the centerpiece of the federal government's
efforts to prevent banks and other financial institutions from being
used to facilitate the transfer or deposit of money derived from criminal
activity. The law was amended after 9/11 by the USA PATRIOT Act of 2001,
expanding the important role the government expects banks to play in
detecting and reporting suspicious activity.
WHAT DOES THE DEFERRED PROSECUTION AGREEMENT REQUIRE?
Under the terms of the deferred prosecution agreement with AmSouth,
the United States has filed a one count information in the United States
District Court for the Southern District of Mississippi charging AmSouth
with failing to file suspicious activity reports in a timely, complete
and accurate manner, in violation of 31 U.S.C. Sections 5318(g)(1) and
5322(b) and 31 C.F.R. Section 103.18. However, the Department of Justice
will recommend to the Court that the prosecution of AmSouth be deferred
for 12 months in light of AmSouth's acknowledgment of responsibility,
its continued cooperation, its willingness to comply fully with the
Bank Secrecy Act, its willingness to comply fully with any subpoenas
issued to it by any state or federal grand jury, and the assessment
of a monetary penalty.
If AmSouth is in full compliance with all of its obligations under the
agreement, the United States has agreed to seek dismissal of the information
with prejudice within 30 days of the end of the 12-month period set
forth in the agreement.
WHAT IS A "CEASE AND DESIST" ORDER FROM THE FEDERAL RESERVE?
HOW LONG DOES THE ORDER STAND?
The order is an enforcement action available to the Federal Reserve.
The order in this case requires that the bank take specific actions,
including steps to comply with the Bank Secrecy Act. The order is in
force until the Federal Reserve determines that the bank is in substantial
compliance with the requirements of the order. While an order such as
this is to be taken very seriously, we believe AmSouth has a solid financial
foundation on which to continue our business.
WHAT ACTIONS MUST AMSOUTH TAKE UNDER THE FEDERAL RESERVE'S ORDER AND
WHAT STEPS HAS THE COMPANY ALREADY TAKEN?
The order requires the bank to:
-- Commission an independent review of the bank's Bank Secrecy Act compliance
program and submit a program to ensure compliance;
-- Review and evaluate suspicious activity reporting, customer due diligence
and fraud detection programs and staff;
-- Conduct a review of account activity to determine whether suspicious
activity was properly identified and reported;
-- Strengthen the bank's internal controls;
-- Develop policies and procedures governing the conduct of the bank
and its personnel in regulatory matters; and
-- Submit monthly progress reports to the Federal Reserve.
The bank has already taken a number of actions, specifically:
-- Engaged a nationally known consultant to provide a comprehensive
review of our suspicious activity detection and reporting process;
-- Reorganized the Bank Secrecy Act compliance area to have a separate
unit devoted to the assessment and monitoring of high-risk customers;
-- Strengthened its enterprise-wide risk management structure;
-- Added additional staff for suspicious activity detection and reporting;
-- Instituted training customized by line of business for detecting
and reporting suspicious activities;
-- Improved processes for detecting and reporting suspicious activities;
and
-- Committed to purchase and operate state of the art technology for
detecting suspicious activities.
HAVE THE VICTIMS OF THE FRAUD COMMITTED BY LOUIS HAMRIC AND VICTOR NANCE
BEEN COMPENSATED?
In 2002 Hamric defaulted on promissory notes he issued to over 40 clients,
triggering a number of civil lawsuits against individuals (Hamric, Nance
and others) and institutions, including Nance's former employer and
AmSouth. AmSouth, together with Nance's former employer, has settled
virtually all of these matters for amounts in excess of the principal
investment.
WILL THE AGREEMENTS HAVE ANY EFFECT ON THE WAY AMSOUTH CONDUCTS BUSINESS?
The Federal Reserve has indicated that it will restrict AmSouth's expansion
activities until it believes the bank is in substantial compliance with
the requirements of the order. These agreements are an important step
in the process of putting this matter behind us. AmSouth is committed
to full compliance with the provisions of the agreements and to continuing
to strengthen its processes.
About AmSouth
AmSouth is a regional bank holding company with $48 billion in assets,
more than 670 branch banking offices and over 1,200 ATMs. AmSouth operates
in Florida, Tennessee, Alabama, Mississippi, Louisiana and Georgia.
AmSouth is a leader among regional banks in the Southeast in several
key business segments, including consumer and commercial banking, small
business banking, mortgage lending, equipment leasing, mutual fund sales,
and trust and investment management services. AmSouth also offers a
complete line of banking products and services at its web site, www.amsouth.com.
### Press Release #########################
Universal Express to Offer $225,000,000 In Equipment Trust Certificates
NEW YORK----Universal Express Inc. (OTCBB:USXP), announced today
that it will offer a series of fully collateralized, senior, fixed income
Equipment Trust Certificates. These non-pooled instruments, collateralized
by both a federally recorded lien and dedicated revenue on individual
cargo aircraft, are seven to ten years in term and return between six
(6) and seven (7) percent annually, paid either monthly or quarterly.
This investment is collateralized by the aircraft, which is fully insured
in the name of the certificate holder.
"Cargo aircraft valuation
has historically increased or been stable over the past decade and,
since revenues are paid directly to the investor through the Trust,
and is senior to any other debt, investors are fully collateralized
for our present and future purchased cargo aircraft," said Richard
A. Altomare, Chairman and CEO of Universal Express.
"In order to acquire
at least four additional regional cargo carriers this proven form of
transportation fund raising accomplishes three objectives: stand-by
funding, non-dilution of our common stock and an introduction of Universal
Express to institutional investors receiving 7% fixed return on their
investment," concluded Richard A. Altomare.
About Universal Express
Universal Express, Inc. owns
and operates several subsidiaries including Universal Express Capital
Corp., (including its USXP Cash Express division) Universal Express
Logistics, Inc. (including Virtual Bellhop, LLC and Luggage Express),
and the UniversalPost Network. These subsidiaries and divisions provide
the private postal industry and consumers with value-added services
and products, logistical services, equipment leasing, and cost-effective
delivery of goods worldwide.
Media: TransMedia Group Glen Calder, 561-750-9800
## Press Release ############################
Fitch
Places Bombardier on Rating Watch Negative
Fitch Ratings-New
York- Fitch Ratings has placed Bombardier's (BBD) and Bombardier Capital's
(BC) ratings on Rating Watch Negative. Fitch currently rates BBD's and
BC's senior unsecured debt and credit facilities 'BBB-', commercial
paper programs 'F3', and BBD's preferred stock 'BB+'. Due to the existence
of a support agreement and demonstrated support by the parent, BC's
ratings are linked to those of BBD. These ratings cover approximately
$6.1 billion of debt and preferred stock.
The Negative Rating Watch is based on significant uncertainties present in BBD's regional jet (RJ) operations and transportation unit (BT), as well as continuing weak operating margins. Fitch believes that it will be able to resolve the Negative Rating Watch in the next three to
six months.
Fitch is concerned that further production rate reductions are possible in BBD's RJ operations due to low backlog levels (1.5 years worth of production), poor order visibility, and backlog risks related to the weak financial conditions of several large airline customers, including Delta Airlines, US Airways, United Airlines, and Independence Air. Delta is currently formulating a restructuring plan that could lead to a bankruptcy filing. Other concerns related to BBD's RJ operation include competitive pressures from Embraer's new 70-100 seat aircraft family, the cash requirements of a possible 100-seat aircraft program, and the weak aircraft
financing market.
The fiscal 2006 (F2006)
production rate that BBD announced last week for CRJ200's was already
incorporated into Fitch's ratings, but Fitch had expected production
of CRJ700's and CRJ900's to be higher. Further production rate reductions
will not necessarily lead to negative rating actions, but will be evaluated
on the basis of several factors including how BBD manages the reductions
and the timing and magnitude of the reductions. RJ production reductions
will also be evaluated in the context of BBD's overall business, given
that business jet improvements and the BT restructuring could offset
the impact of lower RJ deliveries.
Margin improvement
continues to be a key credit issue for BBD's debt ratings. Margins at
BT were 2.8% in the second quarter, and the company has estimated that
margins will be approximately this level for the next six quarters.
At Bombardier Aerospace (BA), margins were negative (- 0.6%) for the
second consecutive quarter, but improved sequentially. BA's margins
continue to be pressured by sales incentives, foreign currency, increased
depreciation and amortization related to new business jet programs,
and higher interest expense allocation due to the debt issuance earlier
this year. Given BBD's level of debt compared to revenues, relatively
modest improvement in margins will drive noticeable improvement in credit
protection measures. However, failure to improve margins or the discovery
of additional problem contracts at BT will likely lead to a rating action.
Other general rating
concerns include low free cash flow, the potential need for further
restructuring actions, the uncertain timing of margin improvement, the
impact of exchange rate fluctuations on financial results and planning,
and the sizable pension deficit.
General factors supporting
the ratings include BBD's liquidity position, the improvement in the
business jet market, better-than-expected free cash flow in the first
half of F2005, significant progress on the multi-year restructuring
plan, leading market positions, the more conservative strategy at BC,
the large backlog at BT, new senior management, and the cost cutting
actions at both BA and BT.
BBD's liquidity remained
strong at the end of the second quarter, with $2.2 billion of cash and
$1.6 billion of credit facility availability. An additional $600 million
is available under BC's credit facilities. Fitch notes that approximately
$1.2 billion of the cash on hand at BBD is related to advances and subordinated
loans extended by BC to the parent. Fitch expects BBD to pay down some
of the advances in the third quarter so that BC can retire approximately
$500 million of maturing debt. Fitch anticipates that some additional
BC advances will be repaid in Q3 to fund increased assets, which declined
temporarily last quarter due to seasonal factors. Fitch expects BBD
to be cash positive in the second half and for the year despite likely
increases in capital expenditures and restructuring outflows during
the next two quarters.
BBD is seeing improved
demand and better pricing for its business jets, consistent with industry-wide
conditions. Orders were up significantly in the first half of the year,
and deliveries will likely exceed the company's plan this year. The
magnitude of the apparent recovery in BBD's business jet operations
is greater than the expectations incorporated into Fitch's ratings of
BBD, and the recovery could offset some of the risk related to BBD's
RJ operation.
Contact: Craig Fraser +1-212-908-0310, New York or Mark Oline, +1-312-368-2073,
(for Bombardier Inc.), Chicago or Philip S. Walker, Jr., CFA, +1-212-908-0624, or
Matthew D. Gallino
+1-212-908-0218 (for Bombardier Capital Inc.), New York.
### Press Release
#########################
Fitch:
U.S. Public Finance Credit Dips in Third Quarter 2004
Fitch Ratings-New
York- Fitch's forecast for the U.S. municipal market is cautious for
the remainder of 2004, following slower, but still positive, macroeconomic
trends and generally negative rating actions. During the third quarter
of 2004, Fitch upgraded 14 municipal issuers, or $36.7 billion in par,
and downgraded 20 issuers, comprising $11.4 billion, for a downgrade
to upgrade ratio of 1.43:1 on an issuer basis and 0.31:1 on a par basis.
However, the par amount upgraded was dominated by the State of California,
which accounted for over $34.2 billion, or over 93% of the total par
upgraded. Excluding the upgrade of California, the downgrade to upgrade
ratio increased to 4.53:1 on a par basis.
There were 14 credits
on Rating Watch Negative as of Sept. 30, 2004, which is unchanged as
of June 30, 2004. During this period, five credits were taken off Rating
Watch Negative in conjunction with a rating affirmation, one was taken
off in conjunction with a downgrade, and six credits were added. The
one credit on Rating Watch Positive as of June 30, 2004 remains on Rating
Watch Positive.
The tax-backed sector
had nine upgrades and eight downgrades in the third quarter of 2004
for an upgrade to downgrade ratio of 1.13:1, compared with 10 upgrades
and four downgrades in the second quarter. Importantly, the number of
tax-backed issuers with a Negative Rating Outlook continued to increase,
growing to 44 from 40, as of June 30, 2004, 25 as of Sept. 30, 2003,
and only 12 as of Dec. 31, 2002. Meanwhile, the number of tax-backed
credits with a Positive Rating Outlook has exhibited a much more stable
trend, hovering in the 20 to 25 range. As of Sept. 30, 24 credits had
a Positive Rating Outlook, as compared with 23 as of June 30, 2004,
25 as of Sept. 30, 2003, and 20 as of Dec. 31, 2002.
In health care, there was one upgrade and eight downgrades in the third quarter of 2004, a significant decline from the second quarter's three upgrades and two downgrades but more in line with first quarter results of nine downgrades and two upgrades. In other revenue sectors, there were two downgrades in transportation, one water/sewer upgrade, two upgrades to state revolving funds, one upgrade to a sports-related issuer, and two downgrades in
higher education.
The credit trend
at the state level seems to be slowly improving as the recent economic
upturn continues to take shape. However, the economic picture is not
uniform across the county, with Midwest state and local governments
still under significant pressure. The expectation for the majority of
state credits for the remainder of the year is for stability as the
improvement in the labor market and related revenue improvements are
beginning to help states grow their way out of current budget pressures.
This should ultimately translate into an improvement at the local level
as well. However, pension benefits and health care costs continue to
be pressure points.
Equity market and
state level improvements, in addition to tuition increases, portend
stability for the higher education sector. The equity markets, operational
improvements, and a continuation of good managed care reimbursement
have also added a stabilizing force to continuing care retirement communities
and acute care facilities.
The southeastern
U.S. experienced a significant increase in the number of hurricanes
that made landfall in 2004. In Fitch's opinion, the structural damage
to certain health care facilities, infrastructure projects, and port/airport
facilities should not result in any rating actions as emergency assistance
provided by the Federal Emergency Management Agency (FEMA), proceeds
from insurance claims, reserves, and/or project revenue should be sufficient
to cover a majority of the costs incurred.
Fitch will be publishing
a comprehensive report on credit trends in public finance in mid-October.
## Press Release
#######################
Robbins
Joins Republic's Aviation & Portfolio Group
Republic Financial
Corporation announced the addition
of Steven M. Robbins to their Aviation & Portfolio Group. As managing
director, equipment investments, Mr. Robbins is responsible for all
asset management duties for this group as well as the origination of
new business from Republic’s East coast office.
Most recently, Mr. Robbins was the vice president, asset management for Mizuho Corporate Bank (USA). In this role, Mr. Robbins was responsible for all aspects of equipment management across business lines within the IBJTC Business Credit Corporation
(formerly known as
IBJ Whitehall).
Prior to joining
IBJ Whitehall, Mr. Robbins held several Asset Management positions at
GE Capital – Vendor Financial Services in Danbury, CT including; manager
- business development under the centralized Asset Management Organization,
and manager - asset management and manager - residual and portfolio
analysis for the Diversified Industries Group. Each of these roles carried
varying Asset Management responsibilities from department management
to facilitation of Mergers and Acquisitions.
Prior to his employment
with GE Capital, Mr. Robbins was the director of asset management for
the Capital Markets Division of AT&T Capital in Morristown, NJ.
Here he was responsible for all Asset Management functions within that
division as well as providing global support. He has also been employed
by The CIT Group and MetLife Capital Credit Corporation where he began
his career in the leasing industry.
Mr. Robbins has been
directly involved with Asset Management for the past fifteen years.
He is currently a member of the Equipment Leasing Association Equipment
Management Committee and is a Candidate in the American Society of Appraisers
awaiting his ASA designation. He is a graduate of the State University
of New York at Cobleskill with secondary studies completed at Iona College.
Sites of Reference:
http://www.republic-financial.com
CONTACT:
Sara Meaney
Republic Financial
Corporation
Phone Number: 303-923-2516
Fax Number: 303-923-2116
E-mail: smeaney@republic-financial.com
### Press Release
##########################
News
Briefs---
Bush-Kerry Debate
Preview
http://atomfilms.shockwave.com/contentPlay/shockwave.jsp?id=
Intel
posts third-quarter profit gains despite weak PC demand
http://www.signonsandiego.com/news/business/
20041012-1424-ca-earns-intel.html
Servers, Wireless
Keep Intel in the Chips
http://www.internetnews.com/bus-news/article.php/3420971
-------------------------------------------------------------------------------
“Sports
Briefs---“
It's Not Perfect,
but the Yankees Will Take It
http://www.nytimes.com/2004/10/13/sports/baseball/
http://boston.com/dailynews/286/sports/Yankees_10_Red_Sox_7_:.shtml
SuperSonics
Defeat Lakers 87 – 80
http://www.nytimes.com/aponline/sports/AP-BKN-SuperSonics-Lakers.html
“Gimme
that Wine”
Major wine wholesalers
merge
http://www.newsday.com/business/ny-bzwine12400357
8oct12,0,5070273.story?coll=ny-business-headlines
U.S. Wineries Are
Booming in Number
http://www.winespectator.com/Wine/Daily/News/0,1145,2625,00.html
Revolutionary inventions
could 'transform' winemaking
http://www.decanter.com/news/58713.html
A Persian Palace
Opens in Napa
http://www.winespectator.com/Wine/Daily/News/0,1145,2626,00.html
Wine
Enthusiast Magazine Announces Winners of Annual WINE STAR AWARDS for
2004
http://www.winebusiness.com/news/SiteArticle.cfm?AId=
Winery
Index: Massachusetts
http://wine.about.com/library/wineries/bl_ma.htm
-----------------------------------------------------------------------------
 |
This Day in American History
1754—Birthday
of Mary McCauley (McCulla - McKolly), is one of the choices to be the "real"
Molly Pitcher. Other candidates are Molly Corbin, Anna Maria Lane, Elizabeth
Canning . . . with many others contributing to the legends. There was
no single Molly Pitcher . . . she is nothing more than a compilation
of legends and popular histories that purport to describe the actions
of a brave Molly Pitcher who defied convention (and hostile fire) to
fire her husband's cannon...The term "Molly Pitcher" was probably
what was used by soldiers in battle calling for the "water boy"
(who was generally a woman) as men today say, "hey girl,"
(or "hey nurse" or "hey, waitress,") " or even
"medic!" According to some legends, Mary Hay McCauley was
a water carrier at the Battle of Monmouth June 28, 1778 where she loaded
and fired a cannon after her husband was killed (some say collapsed
from the heat).In an embellishment of the legend, a cannonball supposedly
passed between her legs tearing her skirt (although the water carriers
always tied their skirts up so they could move around. With skirts at
the normal length, they'd trip or be much hampered in their movements.)
http://earlyamerica.com/earlyamerica/notable/pitcherm/
http://russell.gresham.k12.or.us/Colonial_America/Molly_Pitcher.html
http://sill-www.army.mil/pao/pamolly.htm
http://pages.potpantiques.com/9/PictPage/1352499.html//9/PictPage/
1352499.html?mall=%2Fstores%2FpotpanditemKey=1352499andstore