Features                   

May 2007

We structure our conferences to a pattern to achieve the 90%+ “attend again” ratings we receive. We aim for 30 minute deliveries; a trans-Atlantic element for it is America that leads in this medium, an open forum debate, rigorous analysis of the feedback documents, and a pinch of controversy.

Our first conference headlined the challenges in the UK in the financing of inventory, something not helped in the European theatre by reservation of title constraints.

Our second majored on the several challenges posed by pension law, deficits and dealing with trustees during an acquisition or MBO.

The third Business Money All-Asset Finance Conference examined second lien lending and we beat up the industry with two searching sessions asking how it could improve completion rates and customer satisfaction levels.

Our fourth conference had a well-balanced agenda but had to endure the late withdrawal of our American presenter who was to talk on the preparation, implementation and monitoring of securitisation of all-asset finance. We also missed a report from one of the major UK players that is joining in syndicated deals over there. Our sponsors, Squire, Sanders & Dempsey, experienced a last-minute difficulty with colleagues from Poland and Hungary who were to form a tri-partite panel discussing the way in which UK-based lenders handle cross-border deals.

Some last-minute changes were necessary and my eternal gratitude goes to Andreas Lehman, a German partner of our sponsors who managed his session so well.

Similarly, Paul Clark and David Grier of Menzies Corporate Restructuring who at very short notice prepared a session on collecting out across borders. That both sessions ran over our time frames to 45 minutes is a reflection of the huge professionalism that all of these parties put into their efforts and if our conference wound up with an unintentionally heavy focus upon Germany – Grant Jones also visited this area – maybe that is no bad thing.

This is a land of huge opportunity for lenders to the SME sector there, the Middlestat, and now that new regulation is forbidding German states to guarantee the loan facilities these companies once enjoyed with their banks, any lender prepared to foreswear the desperately short-term, and often unrealistic, profit targets presently bedevilling some of our banks, could reap a rich harvest here. That some UK-based lenders will not go there, whilst others prosper in this environment, underlines the value of our conference, highlighting the opportunities for those that are well prepared and correctly advised.

We also made an unforced late change to the agenda. Hedge Funds were perceived to be one of the biggest threats to the sector though, upon enquiry, we found that this is no longer the case. As one hedge fund player commented: “As all-asset finance lenders are writing mezzanine deals at ABL rates now, there is no appeal for us.”

The receivables led philosophy of all-asset finance now lies dead on the battlefield of a very competitive marketplace. As a result, longer-term and higher loan-to-value property risks are now being written and the commercial property market is giving off what some might interpret as distress signals. This seemed a good opportunity to introduce to the debate a leading authority on the health of property values throughout the UK in William Newsom. He conducts, for Savills, annual review gatherings of the sector each June that none of the property specialists would dream of missing.

I had hoped to introduce some private equity operators, although many of these contacts are jealously guarded by the all-asset finance lenders, but we were fortunate in securing Gerald Raingold, head of Dawnay, Day, for a brief account of two deals he had recently written involving equity and all-asset finance.

I described the closing session as a commercial, inviting one or two jibes, but, in reality, most presentations at conferences are commercials, if you consider why it is that busy people take time out on a conference stand to tell you what they are doing. When you have been reporting on the receivables sector for as long as I have and a product arrives that:

…then I believe I have a duty to give it as wide exposure as possible. We strive to encourage the health of everyone and if I would have preferred Tim Lodge’s enthusiastic and lively presentation to have focused a little more upon the benefits to the user of Credit-IQ, that is a personal sentiment. I make no apology for including it.

But the main theme for our fourth conference was to help our friends in the sector extend their capacity to lend money and we focused upon something that has fascinated me for decades – brands.

We slipped something on this area into a factoring conference two years ago though the UK was not quite ready to embrace the concept. We have also run features in Business Money examining the American experience in this field.

Stuart Whitwell and Tim Chapman presented on a topic that will soon occupy the thoughts of every all-asset financier that wishes to remain competitive and it is unfortunate that our open forum debate on the topic, sagely chaired by Paul Beveridge, was unavoidably foreshortened by the requirements of those serving us lunch. Business Money will revisit brands time and again so the debate will continue and we will try to put something relevant into next year’s conference. This will be number five in our endeavours to ensure that the exciting medium of all-asset finance continues along its successful UK and European path, testing lenders skills, enabling corporate ambitions to become reality. We applaud the FDA for recognising that whilst it has an equal duty to members of all sizes, this is a sophisticated sector demanding a division of its own.

We are a long way down the road now from the prophesies of Ted Ettershank as to the coming of this medium. And the degree to which independent and foreign banks have been allowed a clear run at the UK market suggests that some of our big banks are still attempting to come to terms with the philosophy. And progress in Europe is hindered by the multi-jurisdictional legal challenges. But where there is a will, and excellent legal advice, there is a way.

May I thank those that took the trouble to answer my oft repeated plea for pragmatic comment on the 50 feedback forms that we harvested.

Editor

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