Leasing remains an important source of financing for companies
Leasing is an indispensable financing instrument for many companies. Christopher Punga, Head of Structured Finance at Corporates Germany, explains the developments shaping the leasing market and why leasing will remain a key component of investment in the future.
How do you assess the current market development of the leasing industry in Germany?
Christopher Punga: Despite the economic downturn, the leasing industry in Germany is proving to be stable and forward-looking. Although investment in Germany is declining overall, leasing continues to gain in importance as a flexible financing instrument and is an integral part of many companies’ investment strategy. According to the Federal Association of German Leasing Companies (BDL), more than a quarter of all macroeconomic equipment investments are made through leasing. In total, assets worth over 180 billion euros are currently leased in Germany.
What makes leasing so attractive for companies?
Christopher Punga: Leasing is particularly attractive for companies because it preserves liquidity, offers planning security and enables investments without high initial costs. In addition, the balance sheet often remains unburdened, which improves creditworthiness. In addition to these aspects, companies particularly appreciate the up-to-date nature of the operating equipment, the calculability of costs and the option of returning the objects. Leasing is an important component of investment, especially for small and medium-sized enterprises. According to a recent market study by the BDL, 81 per cent of the companies surveyed consider leasing to be essential in order to remain operational despite limited funds.
What role does HCOB play in the leasing business?
Christopher Punga: HCOB acts as a refinancing partner for leasing companies. We offer refinancing of leasing portfolios both on a recourse basis, i.e. with recourse to the leasing company, and on a non-recourse basis, without direct liability on the part of the leasing companies. We often implement the latter within the framework of securitisation structures, which we either structure ourselves or participate in transactions. However, we primarily refinance leasing companies on a recourse basis in the form of bilateral loans. In our risk analysis, we focus not only on the creditworthiness of the leasing companies, but also on the leasing portfolios to be refinanced and the creditworthiness of the lessees. Here, we attach particular importance to sufficient granularity and valuable assets. We do not usually finance residual value risks.
What sets HCOB apart in this regard?
Christopher Punga: Our customers benefit from our in-depth understanding of the industry, our short decision-making processes and our high level of commitment to implementation. We offer a broad service approach with a great deal of flexibility in structuring tailor-made financing solutions – this forms the basis for a reliable partnership.
Are there any particular areas of focus in financing?
Christopher Punga: We primarily finance the leasing industry at the direct level of the leasing companies, which are also our customers. In their portfolios, our focus is currently on passenger cars, commercial vehicles, e-bikes (company bike leasing), production machinery, construction machinery and industrial trucks, such as forklifts. This means that the manufacturing industry is also an important indirect focus for us.
What developments are you currently seeing in the leasing market?
Christopher Punga: In our view, leasing will play a central role in the government-sponsored and company-planned investments worth billions that are necessary to secure Germany’s competitiveness as a business location – the construction sector in particular will benefit from this. Secondly, in addition to vehicle leasing, the megatrend of service bike leasing continues, even if the sector is no longer showing the growth rates of recent years. And thirdly, lessees are increasingly opting for flexible, individually tailored contract models.
Lernen Sie unsere Leasing-Projekte kennen:
The automated processing of a large number of individual contracts for mobile leasing goods (bikes & e-bikes) is at the heart of this customer relationship.
Financing E-bikes EUR 60 millionThe focus here is on bilateral leasing asset financing for vehicles / cars with a variable financing structure.
Purchase financing for leased vehicles EUR 70 million.Merca Leasing GmbH & Co KG has been an established partner to the manufacturing industry since 1989 for machines, modules and mobile assets.
Bilateral financing EUR 40 million.Industry knowledge and expertise
Our specialized teams in Hamburg and Berlin coordinate all the necessary banking products and services for you. Vertical industry expertise is just as important to us as incorporating general macroeconomic insights into our service promise of “clarity as a service.”