VOL 13 I NO 150 I JULY 2020
FOR THE UK EQUIPMENT LEASING AND ASSET FINANCE PROFESSIONAL
Shawbrook: doing the right thing Chris Richold, MD – Specialist Asset & Sector Finance, shares Shawbrook’s proactive approach CONTENTS
IN THIS ISSUE
10 Motor Finance News
PUBLISHER
LeasingWorld Ltd Oakhill House Uphampton Droitwich Spa Worcs. WR9 OJR, UK 24 Managing in the age of Covid 18 If you think training is expensive, try ignorance E: [email protected] www.leasingworld.co.uk
Published by LeasingWorld Ltd NEWS REGULARS Company No: 5387699. ISSN 1749-3501 UK NEWS DATABANK Printed in England by Pensord, 4 Asset finance market falls by 60pct in May 2020 26 UK new business finance May 2020 Tram Road, Pontllanfraith, 4 Multiple lenders approved for loan schemes Blackwood NP12 2YA CITY CHATTER 5 British Business Bank appoints Interim CEO 28 Old Moore Looks Back No part of this publication may be 6 White Oak exceeds £30m in CBILS loans resold, reproduced or transmitted in 6 SMEs expect to borrow £48bn BACK IN THE OFFICE any form or by any means, electrical, 7 Close Brothers funds assets for state-of-the-art 29 Stop Press: Customer Service Excellence 2020 Awards mechanical, photocopying, recording composting facility or otherwise without the prior written EVENTS 9 Aldermore offers CBILS for invoice finance permission of the publisher. 30 Leasing Events Calendar 2020/21 LeasingWorld Ltd, Oakhill House, 9 SFS appoints Graham Leaney Uphampton, Droitwich Spa, Worcs WR9 0JR. MOVES MOTOR FINANCE NEWS 31 A roundup of who has moved where SUBSCRIPTIONS 10 MotoNovo announces CBILS Support LeasingWorld Annual subscriptions 10 Fleets can deliver a stronger economy • 12 hard copy UK Leasing World magazines 10 Back on the accelerator! FEATURES sent by surface mail – £375 Digital Upgrade CITY NEWS 14 PROFILE: Shawbrook provides the fast track to finance • 12 hard copy UK Leasing World magazines 20 New CEO at Close Brothers We asked Chris Richold to bring us up to date on sent by surface mail 20 1pm “strategically well-placed” for return to growth Shawbrook’s response to the changed and rapidly • PLUS Digital edition – £475 21 Metro Bank Plc appoints Robert Sharpe as Chairman changing asset finance market in mid-2020. DIGITAL Edition 21 Secure Trust Bank issues AGM trading update The Digital version is a Flickread powered 16 How the NACFB took its Expo online “page-turner”copy of the hardcopy publication, and the url link is sent out by 16 Half of brokers fully open for business email the day before surface mailing. The REGULARS Digital version has “live” links to advertisers’ SYSTEMS 17 Sean Williams 1965-2020 websites, surveys, and report downloads. The leasing community is mourning the loss of Sean 8 IT teams prioritising WFH Williams, who passed away on 20 June after four TO SUBSCRIBE 8 LTi helps NABCO grow years fighting cancer. Lord Parry Mitchell give us ONLINE at www.leasingworld.co.uk 8 Alfa changes corporate broker his personal response. freepages/subscribe.php or EMAIL [email protected] MOTOR FINANCE 18 If you think training is expensive, try ignorance 11 Siemens unveils UK’s first Electric Avenue How will asset finance training and education 11 LeasePlan capitalising on motor megatrend actually be happening in the summer of 2020? 11 Click & Collect is catching on ROUND THE ASSOCIATIONS 24 Managing in the age of Covid-19 and beyond Leasing World’s contributing editor Allan Foad listens 12 All the latest news and events in to Patrick Dunnes interviews on the impact of LeasingWorld LEGAL Covid-19 on the business world. 22 Front of mind by Joanne Davis
2 VOL 13 I NO 150 2020 www.leasingworld.co.uk EDITOR’S COMMENT LeasingWorld
he British Bank’s Bounce Back Loans have had a big impact on the market of lending to SMEs, and we have been receiving news from T lessors of nine-figure new business volumes being reached. The big fear, widely recognised, is that many BBLS loans will not make it to repayment, leaving lenders mired in having to exhaust all other means before being able to call on the Government’s guarantee. Added to which, it is uncertain to what extent traditional remedies like forced termination or equipment repossession will be allowed, in the current spirit of forbearance.
EDITORIAL Bouncing back?
The financial press reports that the Treasury has started work on ways to tackle the potential debt problem, and its conclusions will feed into the Chancellor’s Autumn budget. That’s a short deadline and should be an early warning signal to our industry lobbyists to clearly communicate to the authorities the protections essential to asset finance lessors, so they don’t get left in the all too familiar lessors’ limbo. This month’s cover feature shows how one of the industry’s bigger names,
Jan Szmigin Shawbrook Bank, has shifted gears to keep pace with the rate of change. Publisher “Lockdown measures hit a host of sectors very hard, very fast,” says T: +44 (0) 7803 389669 Shawbrook Bank’s Chris Richold, putting a finger on the two aspects of the E: [email protected] current crisis that have proved particularly tough to accommodate, and as Chris adds, “The structure of the loan schemes will also create a number of pinch points over the next twelve months.” In our Motor Finance section we note a general feeling that we’re through the worst of things, though some might say that it couldn’t have got any worse. The FLA’s Adrian Dally’s view is, “Touch wood, one must assume the markets are going North from here!” and June’s FLA statistics will tell us if we are indeed bouncing back. Despite lockdown easing and the first stirrings of a return to office life, Robin Skuse we’ve taken the decision to reschedule our Sky Garden Customer Service Editor Excellence event to next year, to 27 April 2021. But that does not mean T: +44 (0) 7721 727554 E: [email protected] that 2020’s service excellence stars will go unrecognised, as we are still be running the 2020 Customer Service Excellence competition this year, and inviting entries. You’ll find more details on how we’re doing it on page 29. Sadly, the leasing industry lost Sean Williams last month. Sean had a massive impact on a whole generation of young asset finance professionals, one of whom, Nathan Mollett, now Director at Metro Bank Asset Finance, recalls, “I could barely keep up with him even in my early twenties! The legend that is Sean “Curly” Williams lives on in all of those who were lucky enough to work with him.” Lord Parry Mitchell has thoughtfully penned his own memories of, and tribute to, Sean Williams on page 17. n Allan Foad Contributing Editor E: [email protected] JAN SZMIGIN [email protected]
City Slicker City Chatter column E: [email protected]
www.leasingworld.co.uk VOL 13 I NO 150 2020 3 UK NEWS
➔ IN BRIEF Asset finance market falls
PARAGON WORKING WITH HITACHI by 60pct in May 2020 CONSTRUCTION MACHINERY igures published by the Finance & Economist at the FLA, said, “The asset Specialist SME lender Paragon is working FLeasing Association (“FLA”) show finance market reported its lowest level with excavator supplier Hitachi Construction that total asset finance new business of new business for more than 13 years Machinery (UK) Ltd (“HCM UK”) to provide (primarily leasing and hire purchase) fell in May, with the vehicle finance sectors support for UK businesses. by 60pct in May 2020 compared with the continuing to be hardest hit by the same month in 2019. lockdown restrictions. The IT equipment The companies are working in conjunction In the five months to May 2020, new finance sector was the only sector to to offer a low finance start-up scheme to business fell by 30pct compared with the report growth in the first five months assist SMEs with the purchase of Hitachi’s same period in 2019. of 2020. mini excavators. The scheme requires New business in the commercial “Our latest figures show that the no payments for the first 90 days of the vehicle finance and business new car industry provided finance for almost agreement, after which normal payments finance sectors contracted by 62pct 40pct of UK investment in machinery, will resume. and 87pct respectively, compared with equipment and purchased software in the John Phillipou, Managing Director of SME May 2019. Over the same period, the year to March 2020. Lending at Paragon, said, “It is great to be business equipment finance and plant “If this support for business investment able to work with such a reputable supplier of and machinery finance sectors reported is to continue as well as meeting the huge construction machinery in order to continue falls in new business of 40pct and 44pct demand for forbearance, the Government supporting UK SMEs. respectively. By contrast, the IT equipment needs to take action to support all finance sector reported a modest fall in lenders, including non-bank lenders, “During these uncertain times, it is key that new business of 4pct in May. by allowing them to access to funding we support businesses in any way we can Commenting on the figures, Geraldine as suggested in the FLA’s Term Funding and this scheme is a great way to allow Kilkelly, Head of Research and Chief Pipeline proposal.” customers to begin making purchases with the peace of mind of having very low initial payments.”
MAF EXPANDS UK COVERAGE Multiple lenders approved for WITH NEW DIRECTOR Financial services broker Midlands loan schemes Asset Finance (“MAF”) has expanded its nvestec and Paragon Bank are among to mid-term cash flow challenges. agriculture and construction exposure Ithose lenders to have gained accreditation The latest Government published with the appointment of a new relationship to the Bounce Back Loan Scheme (“BBLS”), statistics available at time of going to press director. and joins the other twenty BBLS lenders show more than 913,000 businesses have who have been accredited since the scheme benefited from over £38 billion in loans Based in Worcestershire, Sue Baker has joined opened in May. and guarantees through schemes delivered the company to boost its coverage across the Recently accredited CBILS lenders by the British Business Bank. country as she looks to specialise in assisting include United Trust Bank, Asset Finance This includes 863,584 Bounce Back SME clients with the refinancing of existing Partners, JCB Finance, 4Syte, Merchant Loans worth £26.3 billion, 49,247 loans debts or the purchase of new assets. Money, Growth Lending, inFund, worth over £10.1 billion through the Previously working in the food, agriculture Invocap, NEL Fund Managers, Triple Coronavirus Business Interruption Loan and construction divisions at finance Point and Sonovate. Scheme and £1.7 billion through the company DLL, Sue also spent twelve years Recently-added CLBILS lenders Coronavirus Large Business Interruption as a business development manager at the Greensill, Metro Bank, OakNorth Bank Loan Scheme. Royal Bank of Scotland, working across all and Secure Trust Bank will be able to British Business Bank CEO Keith asset finance sectors. provide finance to midsized and larger UK Morgan said, “Our accredited lenders businesses with a group turnover of more have seen an incredible demand for On joining MAF, Sue said, “Having spent most than £45 million (the upper limit for the Covid-19 business loan schemes since they of the last decade in the agricultural and existing smaller-business focused CBILS) became available. construction sectors, I’m looking forward to that are suffering disruption to their “Accrediting these additional finance using my experience to work with both new cashflow due to lost or deferred revenues providers means further support for and existing clients to offer funding solutions during the Covid-19 outbreak. smaller business customers and continues for their businesses.” MotoNovo Finance is now able to the British Business Bank’s long-term Director of Agriculture & Renewables Rachel provide additional support to the dealer objective to offer more diverse sources of Borlace added, “I am delighted to welcome community as accredited ‘Introducer’ for finance to smaller businesses.” Sue to the team. Her vast experience in the Aldermore CBILS. Aldermore is also now offering the agriculture and working closely with dealers, It is a move designed to provide a new Invoice Finance variant of CBILS, having farmers and manufacturers will continue to funding avenue to more than two thousand been an accredited lender for the Asset strengthen our team.” dealers and 17,000 corporate customers Finance variant of the scheme since April that the business estimates are facing short (see page 9).
4 VOL 13 I NO 150 2020 www.leasingworld.co.uk UK NEWS
British Business Bank appoints Interim CEO atherine Lewis La Torre has been a global portfolio of private capital Catherine Lewis La Torre through the Cappointed Interim CEO of the fund investments with over £1 billion of Autumn to ensure an orderly transition. Government-owned British Business Bank. commitments. Prior to this she was a Partner British Business Bank Chair, Lord She will take up the role from 1 September. with secondaries specialist, Fondinvest Smith, paid tribute to Keith’s leadership Catherine currently holds the position Capital, in Paris having previously been of the institution: “Keith has been an of CEO of the Bank’s two commercial one of the founding partners of fund-of- outstanding leader of the British Business subsidiaries, British Patient Capital and funds manager, Proventure which focused Bank, building the business from scratch British Business Investments. on venture and growth capital investing to create an organisation with considerable In October 2019, Keith Morgan CBE in Europe. scale, reach and impact on businesses announced that he would be standing across the country. Under his leadership, down from the role of Chief Executive of the Bank has supported start-ups and the British Business Bank by the end of ➔ Catherine is a highly growing companies in every region and 2020, after eight years at the helm of the nation of the UK and has responded at UK’s economic development bank. respected industry speed to build a series of large scale loan Since its inception, the Bank has leader, with more than programmes to help UK businesses get grown significantly under Keith through the Coronavirus emergency.” Morgan’s leadership and at the end of thirty years’ investment Lord Smith welcomed Catherine Lewis 2019 it supported more than 94,000 management La Torre’s appointment as Interim CEO, businesses with over £7.7 billion of saying, “Catherine is a highly respected loans or investments through its various experience industry leader, with more than thirty programmes. years’ investment management experience Catherine Lewis La Torre has built a and a strong track record of success. She career in venture capital and private equity This Interim CEO appointment has successfully led the Bank’s commercial fund management. She joined the British allows government to map out the next subsidiaries, British Patient Capital and Business Bank in 2016 from Cardano Risk phase of the Bank’s development before British Business Investments and has made Management, where she was Head of commencing the search for a permanent a considerable contribution to the Bank Private Equity, responsible for managing successor. Keith Morgan will work with since she joined in 2016.”
Backing our brokers with the tools they need
In these uncertain times, we are here to support our brokers with tools to enable them to continue doing business.
With Asset Backer, brokers can arrange deals to be e-sign remotely with a fully end to end paperless process. For businesses affected by COVID-19, we can offer our Asset Finance Coronavirus Business Interruption Loan Scheme (CBILS).
Download our latest support guides at aldermore.co.uk/coronavirus
FOR INTERMEDIARY USE ONLY T&Cs will apply, subject to status and affordability. Any asset used as security may be at risk if you do not repay any debt secured on it.
Aldermore Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Financial Services Register number: 204503). Registered Office: 1st Floor, Block B, Western House, Lynch Wood, Peterborough, PE2 6FZ. Registered in England with Company No. 947662. Invoice Finance, Commercial Mortgages, Property Development, Buy-To-Let Mortgages and Asset Finance lending to limited companies are not regulated by the Financial Conduct Authority or Prudential Regulation Authority. Asset Finance lending where an exemption within the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 applies, is exempt from regulation by the Financial Conduct Authority or Prudential Regulation Authority. AF 0257
www.leasingworld.co.uk VOL 13 I NO 150 2020 5 UK NEWS
➔ IN BRIEF White Oak exceeds £30m
ACQUIS SEES in CBILS loans “ENCOURAGING” SIGNS on-bank business finance provider clearly looking for fast access to funding The latest Acquis Index, published by NWhite Oak UK has announced to trade through the present conditions, independent insurance administrator Aquis, that more than £30 million in CBILS and we have been pleased to be able to shares some trends in equipment leasing lending has been provided to both new deliver this in our usual style – simple, volumes that may prove a useful indicator and existing customers over the last six quick, and backed by great service. The for the wider leasing industry. weeks, with a further £20 million of new whole process has been well received by CBILS lending approved for release. our customers and brokers; we’ve received Acquis’ volumes are predominantly made up After being accredited as new lender some great feedback on the facility”. of small ticket equipment with an average by the British Business Bank under the Demand has been particularly strong ticket size of €12,000. 58pct of the volumes Coronavirus Business Interruption Loan in the manufacturing, construction, are made up of computer / office equipment, Scheme (“CBILS”) for term loans, White and professional service sectors, with 15pct retail and 12pct manufacturing, with Oak UK launched their dedicated online significant lending required for working the remainder consisting of construction, lending portal on 13 May. capital, consolidation, and investment material handling, medical and other assets. The portal, which has achieved more purposes with deals ranging from As was predicted in the April index, lease than 11,000 visitors since its launch, £75,000 to £600,000. originations continued to fall during May, delivers a fast and simple online Under the Scheme, associated interest when inception volumes hit 36pct of 2020’s experience for users looking for CBILS and fees are covered by the Government Q1 average. However, for Acquis this was a funding. Customers can quickly and for twelve months, a benefit that is passed better performance than early predictions simply check their eligibility and apply on to customers. originally indicated. for CBILS funding online, with approvals Additionally, repayments on CBILS typically received in as little as twenty- loans can be deferred for up to twelve In the European restaurant sector during four hours. months, meaning that White Oak April, lease inceptions for restaurant Andy Davies, Managing Director of customers are able to make no repayments equipment had fallen to 18pct of their first Leases and Loans at White Oak UK, whatsoever for up to a year, something quarter volumes. During May, however, said, “The level of demand we have seen that has proven to be a popular facet as there have been some early indications of for CBILS loans has been significant and businesses start to plan for recovery post improvement as lockdown easing begins to continues to grow. Business owners are Covid-19. take effect across Europe and restaurants embrace new take-out and delivery models, with these European lease inceptions achieving a noticeable increase on April’s SMEs expect to borrow £48bn volume. The sector’s lease volumes are at 24pct of their Q1 average. ew research from Aldermore to their needs, as well as providing access While still declining, computer equipment Nbank reveals that the UK’s small to funding and the guidance they are and medium-sized enterprises expect looking for. The year ahead is going to also fared better than average, managing to to borrow £48.3 billion to support be as equally, if not more, challenging as maintain 49pct of Q1’s volumes. their business following the Covid-19 the aftermath of the financial crisis, when The regional performance variations we outbreak. Aldermore was established. Our research witnessed in April, continued in May, with More than three in five (61pct) SMEs shows that the average SME expects it France being one of the hardest hit of our anticipate borrowing nearly £65,000 in will take them eight months to financially European regions with volumes falling to 23pct the twelve months following the outbreak. recover after the lockdown ends, and it of where they were in the first quarter of 2020, Speedy access to funding (23pct), higher is going to need a considerable concerted compared with 53pct in the Netherlands. levels of funding (17pct) and a simple effort by both government and lenders to The outlook for June suggests the steep application process (17pct) are viewed as support businesses to help get them back downward trend witnessed during the last needed by SMEs to navigate the months on their feet.” two months might have already begun to following the outbreak. A third (32pct) of SMEs say the key Tim Boag, group managing director, to getting their business back on track flatten with anticipated volumes stabilising business finance at Aldermore, said, will be good communication with their close to May levels. “Helping SMEs recover following the customers and clients. A further quarter Acquis’ Chief Commercial Officer James pandemic will be crucial to the economic (25pct) state they will benefit from Rudolf comments, “In some ways there are future of the UK. As our research receiving ongoing Government support no big surprises here; we anticipated that has shown, SME income has been hit with 22pct of SMEs also suggesting that the impact of the Covid-19 pandemic would hard by Covid-19 with many having getting employees back on track and continue to hit hard during May. But what borrowed funds in order to survive, and focused on the business’ goals will be has been encouraging to see, is that the with some expecting to continue to do so important in recovery phase. Rebuilding impact hasn’t been as deep as early views in the year ahead. supply chains and relationships with may have indicated and we are already “Aldermore’s focus is on backing our suppliers is seen by 17pct of SMEs as witnessing some small but not insignificant customers through this period, continuing being crucial in helping their business green shoots in some areas.” to work closely with them and responding recover following the Covid-19 outbreak.
6 VOL 13 I NO 150 2020 www.leasingworld.co.uk UK NEWS
Close Brothers funds assets for state-of-the-art composting facility
lose Brothers Asset Finance has complete thanks to its complexity and the Cprovided significant funding for number of stakeholders involved. Biowise Ltd’s new state-of-the-art In- “A typical asset finance deal will Vessel Composting (“IVC”) facility, normally complete relatively quickly, built to treat organic waste on behalf but it wasn’t the case this time. Having of Cheshire East Council. Biowise is a now agreed a process, we have a leading recycling and waste management template in place and look forward to firm based out of Hull. assisting Biowise in delivering their next The IVC plant allows for the annual major project.” collection, processing and recycling of James Landau, Managing Director up to 75,000 tonnes of residual food of Biowise, said, “There were a number and garden waste with over 95pct of key players in this deal, with Close of the waste inputs recycled into manufacturer) IVC, followed in 2016 by Brothers Asset Finance being one. Not high quality BSI PAS 100 certified an addition to the plant in the form of an only do they understand our market compost for use in horticultural, aerated floor system (“AFS”). but they bring expertise to the table agricultural and landscaping markets. “Our close relationship and mutual that extends beyond the funding and, The remaining 5pct will be recycled or understanding led us to go the extra as always, I found working with them sent for energy recovery. mile to support Biowise and resulted straightforward. Paul Hindle, Sales Director for Close in us funding both the IVC and AFS in “I’m delighted to say the new facility Brothers Asset Finance’s Recycling a five-year deal, with the site completed is already processing 45,000 tonnes per division, said, “We have a great track in February 2020 and handed over to annum of organic waste brought in from record with Biowise, having worked Cheshire East Borough Council.” the Cheshire East area and we are actively with them since 2014 when we funded According to Paul, the deal was out of seeking additional contracts to fill the their first GICOM (composting system the ordinary because it took two years to spare capacity.”
Together, powering UK businesses to grow
With award winning service and over 30 years of expertise, Hitachi Capital Business Finance provides a flexible range of asset finance solutions – powering businesses of all sizes, across sectors and specialities. • Asset Finance • Stocking • Block Discounting • Invoice Finance
To power your business call us today 01784 227322 hitachicapital.co.uk/business-finance
Finance is provided by Hitachi Capital (UK) PLC. Authorised and regulated by the Financial Conduct Authority. For business purposes only. Full terms and conditions apply.
www.leasingworld.co.uk VOL 13 I NO 150 2020 7 SYSTEMS
has recently been made a recipient of this year’s “NextGen Leader Award” from the SYSTEMS Monitor Daily. Monitor Daily presents the “NextGen Leader Award” to individuals under 40 who demonstrate extraordinary leadership in the equipment finance industry. Peter holds responsibility for driving the execution of product strategy, roadmap, and user experience for LTi’s flagship product ASPIRE. LTi states: “Peter’s solution-oriented approach and ability to solve complex problems has made a noticeable impact on the vision, direction, and achievements of LTi. [His] effectiveness as a leader has much to do with his 10+ years of industry experience playing various roles within LTi’s organisation.” Peter is a current member of ELFA Operations and Technology Committee, working with a group of talented and experienced industry leaders to plan the (35pct) in the coming 12 months. annual ELFA Operations and Technology IT teams • 49pct (63pct of executives) feel employee Conference. productivity has increased since WFH prioritising WFH began – with 35pct saying productivity Nearly 40pct of IT professionals who has stayed the same. responded to a survey commissioned • 3 in 5 expect the number of remote Alfa changes by Sectigo report that their companies workers will increase after their delayed revenue-generating initiatives for offices reopen. corporate broker one month (44pct delayed cybersecurity Alfa Financial Software Holdings PLC projects) so that IT teams could prioritise (“Alfa” or the “Company”), a leading remote work setup. Sectigo, a leading developer of mission-critical software for cybersecurity provider of digital identity LTi helps NABCO grow the asset finance industry, has appointed solutions, highlights that: LTi Technology Solutions (“LTi”), among Investec Bank plc as corporate broker to • 86pct report challenges in managing the leading providers in equipment work alongside existing corporate broker the digital identity of users, devices, finance software, is excited to announce Barclays Bank plc with immediate effect. and processes. that North American Banking Company Trading in the first six months of the • At least half use authentication technologies (NABCO) is live with ASPIRE on the financial year ending 31 December 2020 with widely known vulnerabilities, LTiCloud. As a well-established bank, has been better than expected, and Alfa such as traditional username/password NABCO was looking to grow its leasing reports demand has been largely resilient (65pct) and hardware-token multi-factor division and needed a technology platform to the pandemic. The impact of remote authentication (50pct). that could support its strategic goals of working has had little impact on operations, • Among the strong authentication expanding their leasing portfolio. ASPIRE other than fewer holidays being taken than methods, user identity certificates enables NABCO to optimise operational normal, and as a consequence an increase (56pct) are far more prevalent than agility while building a foundation for in the number of days work delivered to biometrics (26pct). future growth. clients. Cash performance is said to have • Phishing (40pct) and Wi-Fi (40pct) A more scalable, flexible solution was remained strong with net cash increasing trump Zoom Bombing (28pct) and needed to help drive NABCO into the in the period, further strengthening the unsecured BYOD devices (28pct) on the future. NABCO wanted to work with balance sheet. list of top security concerns. a proven, industry-leading technology Alfa explains, “In the second half we • 71pct don’t feel completely confident provider and knew LTi would be a key expect to see a catch-up of holidays being that their company can report on partner in their digital transformation. taken by our people, and we continue to full compliance with industry and Having a Software-as-a-Service (SaaS) be wary of the potential for disruption government standards on digital identity delivery model allows opportunity to our current work schedule and future during remote work. for NABCO to innovate rapidly, prospects from changes in client's priorities • Nearly 60pct expect security for data automate business processes, reduce and plans. and applications to increase when offices costs, and increase scalability through “We remain cautiously optimistic for reopen, yet 75pct believe their company software applications. Furthermore, the the outlook for the business, although is investing “the right amount” on infrastructure of the ASPIRE platform there still remains some weakness in the cybersecurity, despite concerns. provides NABCO the affordability to early stage pipeline due to a reduction in • IT pros expect to increase use of digital step into a system and grow and expand clients initiating projects as a result of the certificate-based authentication (38pct) over time. pandemic, which could also impact the and digital document-signing solutions ASPIRE Product Manager Peter Haug, business in 2021.”
8 VOL 13 I NO 150 2020 www.leasingworld.co.uk INVOICE FINANCE
Aldermore offers CBILS for invoice finance pecialist bank Aldermore is now loan provided in conjunction with an of gross debtors, with a maximum 3 year Soffering the Invoice Finance Invoice Finance facility. term and a maximum top-up of up to variant of the British Business Bank’s Tim Boag, group managing director, £5 million. Coronavirus Business Interruption business finance at Aldermore, said, “We The term loan sits alongside the clients Loan Scheme (CBILS), having are delighted to continue working with invoice finance facility with Aldermore been an accredited lender for the British Business Bank to offer our with a maximum of 6 years. The the Asset Finance variant of the scheme customers the Invoice Finance variant of minimum lending amount is £50,000 since April. this scheme, which will help Aldermore and the maximum loan is £5 million. CBILS provides Aldermore and other provide further funding to support SMEs SMEs are able to apply for either accredited lenders with a government- build business confidence for recovery facility, but not both. The maximum backed guarantee, enabling Aldermore and growth.” lending for both facilities are subject to provide support to both existing and The Top–Up of Invoice Finance facility to the client meeting the eligibility new prospective clients with a top-up to allows businesses a top-up of their criteria which can be found on their Invoice Finance facility or a term Invoice Finance Facility of up to 30pct Aldermore’s website. SFS appoints Graham Leaney to lead Invoice Finance Sales iemens Financial Services (“SFS”) after more than eleven years in various said, “I’m excited to work for such an Swelcomes Graham Leaney as Head roles at HSBC. established brand and to be able to offer of Sales – South for its Invoice Finance SFS’ Invoice Finance team offers small customers the security of funding that team. Based in West Sussex, Graham is to medium sized enterprises a range of goes with that. In the Siemens context, responsible for providing and developing financial products designed to bridge invoice finance sits within a whole range invoice finance services for clients across the gap between the delivery of goods or of working capital management tools that the southern region. services and the receipt of payments from are critical for smart and agile businesses Graham joins the leading international customers. Using this service means that – especially in the current climate.” specialist financier with 17 years’ when a company invoices their customer, Welcoming Graham to his new role, experience in the invoice finance sector. up to 90pct of the approved invoice total Simon Penn Head of UK Sales – Invoice In his previous role at Close Brothers is immediately advanced by SFS, with the Finance & EPT added, “Graham’s Invoice Finance, Graham served as remaining 10pct paid once their customer extensive experience in the invoice Regional Sales Director for almost four settles the balance. This provides the finance sector will be a valuable asset to years and ranked as top performer the last company with essential working capital our team. His appointment demonstrates two years running – a success he hopes so it can then invest in expanding its our uninterrupted commitment to the to replicate with SFS. Prior to that, he business without having to wait for bills market, even in times of uncertainty, and worked as Regional Sales Director with to be paid. I look forward seeing him help businesses independent provider Innovation Finance Speaking about his new role, Graham in the south continue to grow.”
Nationwide asset recovery & remarketing specialists in I.T., telecommunications and reprographics
EBM ASSET MANAGEMENT PLC
Contact Martin Relph T 01708 523014 F 01708 524858 E [email protected] www.ebmplc.com
www.leasingworld.co.uk VOL 13 I NO 150 2020 9 MOTOR FINANCE
“BVRLA members have a unique perspective on the issues facing road transport in the UK and have the purchasing power to tackle them,” said BVRLA Chief Executive, Gerry Keaney. “They have a long track record of working constructively with policymakers to drive down emissions, improve safety and make road transport more cost efficient and accessible.” In its recovery plan, the BVRLA gives the Government a set of five clear priorities that can deliver more sustainable transport for a stronger economy: 1. Maintain the financial liquidity that Motor underpins the motor finance market. 2. Provide a tax and incentive regime FINANCE NEWS that will stimulate vehicle demand. 3. Focus on the key levers for accelerating road transport decarbonisation. 4. Take a more active role in supporting MotoNovo announces in the market for future vehicles. and managing the roll-out of Clean While borrowers remain fully liable Air Zones. CBILS Support for the debt, no personal guarantees are 5. Support the role of flexible car models MotoNovo Finance has announced required for facilities below £250,000. in enabling more sustainable transport that it is now able to provide additional The Government is guaranteeing CBILS choices. support to the dealer community as in an approach designed to encourage The BVRLA has also written to accredited ‘Introducer’ for the Aldermore lending; something that MotoNovo hope Chancellor Rishi Sunak providing a more Coronavirus Business Interruption Loan will provide confidence to dealers to detailed proposal on the tax and stimulus Scheme (“CBILS”). apply and invest in capital items such as measures that should be deployed to It is a move designed to provide a transporters to support the trend towards ensure a net zero recovery and healthy new funding avenue to more than two distance-selling or for re-financing automotive sector. thousand dealers and 17,000 corporate existing assets. customers that the business estimates Curtis concludes, “This is not a soft are facing short to mid-term cash flow launch; we have developed a wide- Back on the accelerator! challenges. ranging campaign to reach out to our Adrian Dally, Head of Motor Finance “Dealers and their corporate dealer community and ensure they are at the Finance and Leasing Association customers are emerging into a new aware of our CBILS opportunity. At the (“FLA”) reports that around 600,000 trading environment that has and will same time, our commercial team will be FLA customers are currently in continue to see significant structural contacting our commercial customers. forbearance and each of those will need an change. Many will be seeking more We recognise the need for dealers to individual answer in the next few weeks routes to access capital, having seen their reinvent their business model for the new to the question “what happens next, at cashflow interrupted and will be looking operating environment; CBILS can help the end of three months?” As an industry, to invest in the development of their many of them to start making this move.” we will need to answer that question for business models. As an accredited CBILS a very large number of people in a very introducer of our parent Aldermore Fleets can deliver a short space of time. So the challenge Bank we can help now,” announces Luke is to handle these queries in a way that Curtis, MotoNovo’s Head of Motor – stronger economy personalises every response but which is Commercial Finance. The vehicle rental, leasing and fleet also very quick. The FCA’s latest guidance The Coronavirus Business Interruption sector can work with policymakers to is about reconciling those two things in Loan Scheme is designed to provide deliver a swift rebound in the economy a way that works; giving the green light financial support to SMEs across the UK and a faster trajectory towards transport to a model from a lender that says “you that have lost revenue, having seen their decarbonisation. can put most of your customers through a cashflow disrupted, as a result of the This is the key message of the BVRLA’s digital process” – using self-help decision Covid-19 outbreak. MotoNovo is now new Covid-19 Recovery Plan, published in trees, for example. able to offer an introduction between June. As well as setting out the industry’s If you ask a customer to answer certain eligible dealers and Aldermore to discuss sustainable transport credentials, the questions about their current situation, CBILS loans (HP and finance lease) of report urges policymakers to work with those answers can then lead the customer between £50,000 and £250,000 available. BVRLA members in supporting the in an automated way to one of four or It is a lending range that can help many automotive sector and delivering net- five different options, giving them further of MotoNovo’s dealers, while making it zero transport. The plan also shows how information about what that solution accessible to commercial customers will the industry can drive positive transport means to them and the costs, the pros and assist them in sustaining their businesses, behaviour change and help tackle the cons, and they can then take a decision. helping them to invest and keeping them scourge of air pollution. Leasing World asked the FLA whether,
10 VOL 13 I NO 150 2020 www.leasingworld.co.uk MOTOR FINANCE
in the light of more avoidance of public diesel engined vehicles. You can now pick “On motor finance I wouldn’t want to transport and less long-distance driving, up an electric car on lease for under £200 be associated with one particular letter electric car purchases had seen a boost in before VAT so that’s making a difference. or squiggle, but the letter that’s spoken demand. Adrian Dally pointed out that in I recently dealt with a business looking about most would be a W, where you’ve fact, electric vehicle take-up had not been for a small fleet of three cars and they’ve had initially where we are now pent-up hugely affected. “The trends that were chosen to go electric – and the staff can demand from the lockdown so cars have there before coronavirus are still there charge them at home so in that scenario gone out of dealerships quite quickly. but they have been accelerated – faster there are no range issues to worry about. But then you’ve got the September plate evolution rather than revolution.” And in any case, range is going up and up change so there will be people hanging While electric vehicles may seem on the with each new generation.” back till then as always happens. Then face of it to be the flavour of the month, Graham reminds us that plug-in hybrid you get another peak in September price and lesserly infrastructure seem vehicles will cease to be exempt from the which may well coincide with a stronger to be holding them back. Adrian says, London congestion charge next year and recovery anyway and then the uptick post- “Some [returning workers] would have expects that will precipitate a further September may prove to be sustainable. commuted to work by bus or train and decline in the hybrid market. Graham Hill, meanwhile, suggests they’re now looking at driving instead, The FLA reported an 87pct fall in the impact of the new numberplate in and that’s one of the reasons why the business new car finance in its May September has been overstated: “People used car market in particular has picked 2020 data, but Adrian Dally explains, often actually prefer to get an August up in the last few weeks in contrast to the “Obviously dealerships opened from model that September because the August new car market – people wanting access June and that applied to as well as model actually shows the year (20) which to a runaround [rather than high-value business. And there was a fair amount can prove more reassuring at resale – ’70’ product]. The hybrid sector has done of fleet in the background through click- in September is just less clear and intuitive. particularly well during the crisis.” and-collect type models. So touching It’s likely the big fleets that are tied to the Graham Hill, motor finance broker wood, one must assume the markets are September plates for legacy reasons. soon to celebrate 30 years running GHA going north from here.” If we end up seeing a significant spike Finance, gave us his own perspective. Asked to make a bold prediction about in March 2021 (for the ’21’ plate) than in “I’ve had a lot of enquiries after electric the shape of the post-lockdown recovery September 2020, then the recovery may vehicles, as many as are after petrol and in the motor finance sector, Adrian says, in fact turn out to be VW-shaped…
UTB | CBILS - Coronavirus Business Interruption Loan Scheme www.utbank.co.uk/cbils
Hire Purchase l Finance Lease l Re-Finance
OPEN FOR BUSINESS Service you can depend on We understand that you are looking for an approachable, adaptable and knowledgeable funding partner. One you can depend on to provide first class service every time.
100% broker focused lending | Direct access to underwriters | Quick pay-outs
T: 020 7190 5555 E: [email protected] we understand property finance
www.leasingworld.co.uk VOL 13 I NO 150 2020 11 ASSOCIATIONS
ROUND THE ASSOCIATIONS
n Time to start spending again than just comply with a one size fits all n A summer we shall not forget Stephen Haddrill, Director General of edict on payment holidays. Support needs The National Association of Commercial the FLA, writes: We are great spenders. to be sustainable for the borrower, not Finance Brokers (“NACFB”) Chair Paul Consumption is the lifeblood of the plunge people into debt they will not be Goodman reflects on the Association’s British economy. Consumer spending able to repay. work in recent weeks and explains how topped £340 billion in the last quarter of Second, lenders will themselves need the NACFB’s voice is being heard and the 2019. A high proportion of that is financial assistance so that they can getting louder. debt funded. Household debt is typically afford to continue to support their Whilst it may not be the summer any of equivalent to over 80 per cent of GDP. At customers. All discussion of payment us were anticipating, NACFB Members the end of last year outstanding consumer deferrals has been about the next three and Patrons remain a typically resilient credit stood at £225 billion, not counting months. A sustainable strategy needs to cohort of finance professionals. The student loans. look at longer term scenarios. It needs speed with which critical business funding In the last few months the picture has to take into account of the fact that this reached businesses in need has been awe- changed. Consumer lending fell by £11 crisis might well not be over in another inspiring. Brokers and lenders alike have billion in total over March and April. few months, that there could be another stepped-up, and so far, more than one Nevertheless we remain dependent on peak in infection. million businesses are being ventilated credit now and will do so over the coming Third, the UK, almost uniquely in the through over £42 billion in finance within months to fuel our economic recovery. EU, has a new breed of lenders who have the Covid-19 lending schemes. Government has itself become massively grown up since the financial crisis. Back at the very start of the pandemic more indebted through the furlough They are not licensed banks. They raise the NACFB made an early decision to scheme, social security payments, grants funds on the capital markets and from impose a Member fee moratorium for to local authorities and loans to business. banks. They make a major contribution, four months. As of next month, this will It cannot be said that the Chancellor especially by lending to business. They come to an end. I am extremely proud of has not been open handed. At the are innovative and customer-focused. the way the NACFB was able to step-up same time Government has had help However, not being banks means they for our Members, and I remain grateful from the lending institutions to keeping do not have direct access to Bank of to the hundreds of Members and Patrons households and businesses in funds. England Term Funding support, and that who have shared with the team their Never before have lenders been so willing funding is not flowing to them through recognition of our efforts. to help their customers keep afloat and so the banks which do have access to that avoid dependency on social welfare. FLA funding as Government hoped it would. Moving Britain Forward members alone have received over 1.5 The contribution of these institutions is As an accredited partner of the British million requests for help with their loans. too precious to lose and the labyrinth of Business Bank, the NACFB has been They have deferred repayments and in obstacles around Term Funding needs to well placed to provide direct feedback, some cases waived their right to extra be straightened out. guidance, and assistance with the various interest. The cost has been huge. It is sometimes said that UK consumers loan schemes. The Association has directly Lenders will continue to treat their are over indebted; do not save enough; supported the Coronavirus Business customers’ requests for help fairly, and and that the country needs to wean itself Interruption Loan Scheme (“CBILS”) with respect for their circumstances. off consumption and onto investment. and Bounce Back Loan Scheme (“BBLS”) However, the cost of providing help is not For the future, the balance of the applications of several NACFB Patrons, affordable indefinitely and the longer it economy does indeed need rethinking, and the number of accredited Patrons is provided, the less new lending will be not least in response to the now evident continues to grow. As it stands, 70pct of available. Government must not expect need to maintain a stronger NHS, better lenders accredited through the scheme are to just co-opt lenders as an arm of social welfare provision, a better infrastructure Patrons of the Association. policy in this crisis. Instead it needs to and a greener planet. For now, however, That said, several cases are emerging of build a partnership with lenders based on we need to start spending again, with fraud in relation to government-backed three principles. lending available to enable it. And that loan schemes. There has been some First, lenders should be free to do what requires a compact between Government evidence of company directors taking they know how to do best: talk to their and lenders that will deliver support for out a BBLS facility, transferring the funds customers about their needs and develop borrowers sustainably for more than a into a personal account, and then placing support that meet those needs, rather few weeks. the company into liquidation. If you are
12 VOL 13 I NO 150 2020 www.leasingworld.co.uk ASSOCIATIONS
concerned that you have been involved with As a result of the NACFB’s feedback, The NACFB’s flagship Commercial such a transaction and require support struggling businesses with supply chains Finance Expo will now take place on or assistance, I would encourage you to that rely on Trade Credit Insurance will Wednesday 24 March 2021 at the contact the NACFB compliance team. now get support from the government. same venue, Birmingham’s NEC. The government is currently guaranteeing All existing delegate and exhibitor Steering policy output business-to-business transactions for bookings are still valid, and registration The Association continues to work both trade and invoice finance, which is remains open via the event website: closely with the British Business Bank, supported by Trade Credit Insurance – www.commercialfinanceexpo.co.uk. Department for Business, Energy and ensuring most insurance coverage will be As we move through July, and with Industrial Strategy (“BEIS”), HM maintained across the market. our economy slowly awakening from Treasury, the FCA and the Bank of Our voice is being heard by those in hibernation, the number of government- England, providing frontline feedback positions of influence – and it is only backed loans our community is helping that is demonstrably shaping both policy getting louder. to facilitate is plateauing – but we cannot and initiatives. Norman Chambers and I afford to rest on our laurels. I believe have held several high-level discussions Staying connected we are sitting in the eye of the storm over the threat to non-bank lenders and June saw the NACFB stage our first ever and more challenges await us as restrictions their ability to lend throughout the crisis. Virtual Expo, with over 1700 finance are further eased and businesses assess a In a recent British Business Bank professionals engaging with the range of new way forward. It is here that NACFB roundtable discussion, chaired by exclusive content on offer. At the heart Members can show their mettle and really Lord Smith of Kelvin, our insight was of the virtual event was an exclusive add additional value to their clients. particularly well received. These efforts expert panel session featuring some of Thank you to all the Members are not simply just in the interests of the industry’s leading lending experts, and Patrons who have stood by the Patrons. For Members, it is vital there who discussed the reaction to the start of Association, as we, in turn, have made remains a dynamic lending environment, the crisis, assessed where we are now and every effort to stand shoulder to shoulder one with both competition and choice. looked ahead to future developments. with you. We are truly at the dawn of a We will continue our calls for greater My gratitude to Francis Evans from new era, one that places the responsibility parity with the bigger banks in the form BEIS, Patrick Magee from the British of Moving Britain Forward at our feet, of funding from the Bank of England, Business Bank, and Matthew Davies and I am proud to say the NACFB will with an extension of the same loan from UK Finance for sharing both their be with you every step. guarantees provided to them. time and peerless insight. Stay safe and well.
Tailoring Bespoke Resourcing Solutions.
Bespoke. The right approach.
At CBC our personal approach provides the sort of tailored response that only comes from really taking time to genuinely understand your needs.
Your trusted resourcing partners in banking & financial services
North: 0161 486 0011 South: 0203 053 8647
www.leasingworld.co.uk VOL 13 I NO 150 2020 13 PROFILE
A MASSIVE THANK
To what extent has good crisis preparation been key to weathering the current storm? It never felt particularly glamorous, YOU but “operational resilience” has been a key focus within the sector and here at Shawbrook for a while. Having plans and processes in place to mitigate known risks is one thing, but creating the right framework and culture to deal with the unknown is by far the bigger challenge. In tests we may have considered the impact of just one of our sites being unavailable, but in reality Thank you to our taxi drivers who have we had to migrate the entire business to been quietly transporting NHS staff and equipment to where they are most needed. remote working in a very short space of time to protect the health and safety of Just as you support your customers, we want our people. Although it was never going to support you. So, if you are a Shawbrook Bank customer, find out how we can help. to be easy, the transition was actually quite straightforward in the end – thanks [email protected] largely to having the right technology shawbrook.co.uk/coronavirus in place, clear direction and the will of everyone involved. As we now move past one hundred days of lockdown, it’s clear that communication has been the most powerful tool of all – multiple means of keeping in touch internally, whether it’s Zoom, Slack or Skype, and being proactive with customers. Shawbrook We know what needs to be done, we know what’s right to do and we’ve done a pretty good job of enabling our people to get on and do it. provides the fast What examples of flexibility has Shawbrook shown to accommodate the needs of the hardest-hit? Our initial focus early in the year was on pro-actively identifying customers with track to finance heavy dependency on supply chains in China and reaching out to them. But the situation then evolved, as we all know, We asked Chris Richold, Managing Director – Specialist and lockdown measures here hit a host of Asset & Sector Finance at Shawbrook Bank, to bring us up sectors very hard, very fast. to date on Shawbrook’s response to the changed and rapidly Within our portfolio we have a large number of customers in the taxi trade, changing asset finance market in mid-2020. all of which saw their primary revenues
14 VOL 13 I NO 150 2020 www.leasingworld.co.uk PROFILE
evaporate over night. The taxi book isn’t enquiries and activity, as you can imagine, large by value, but we do have a significant including some significant transactions. A volume of customers, including individual general willingness to be pragmatic and drivers and fleet businesses, and we’re innovative in our approach has ensured A MASSIVE proud of our heritage in the market. we’ve not stood still. So we quickly established a fast-track process for 3 month payment holiday What impact do you think the government requests up to a specific value, enabling us loan schemes are having? THANK to provide rapid reassurance and practical Government response was swift and support to these customers. We haven’t significant. By the end of June we’d seen charged fees and we haven’t accrued interest over £43 billion of lending flow through YOU during that initial 3 month payment holiday. these Schemes, almost £30 billion of which And given the whole industry is still facing was down to BBLS alone. That’s a massive the same issues three months down the line, quantum of lending, which is going to we’re also doing everything we can to be have a significant impact on the market pro-active and to provide further support for a long time to come – not least given We know that drivers, haulage and roadside recovery fi rms across the UK are working hard to keep supply chains moving, deliver PPE and where it’s still needed. the operational and capital overheads of help ensure there is food on our tables. delivering and managing these facilities. Thank you. Whilst you are supporting your customers, we want The structure of the Schemes will also to support you. As a Shawbrook Bank customer, contact us to fi nd out how we can help. “They really are the number create a number of pinch points over the [email protected] shawbrook.co.uk/coronavirus 1 finance house supporting next 12 months as they’re phased out and individual transactions start hitting G01618_3 Thank You Campaign_Print Ads_Commercial Motor_210x297.indd.indd 1 01/05/2020 15:37 our trade at present. Their their first anniversary when interest and/ Has the last three months changed the way knowledge of the industry or capital payments are no longer paid by you work with intermediaries? is far superior to any other the government. For the past 6 months we’ve been looking We’re accredited for Term Loans under very hard at how we work alongside our bank and has aided them CBILS and it’s a great tool to help existing intermediary partners to deliver quicker to fully understand what is larger customers trade through and out of decisions, greater certainty and better the current crisis. outcomes for the end client. We’ve worked needed to help cab people The longer-term impact will hit both hard to clarify the asset classes and sectors in need of that help... Thank supply and demand. Businesses will we are best placed to fund and now it’s you David and the team, always need funding for assets, working down to having a great service model, data capital and strategic investments, which is and technology. we salute you.” exactly what we do as a specialist lender to Everything I’ve seen over the past twelve Coltscabs UK SMEs. But I suspect our task will be weeks simply serves to show we’re on the to ensure we continue offering flexibility, right track and that we’re absolutely aligned speed and certainty – data and technology to our key intermediaries. We’ll weather For larger customers too, we’ve been will play a big part in that, but so will this storm together and by doing the right quick to offer a host of practical support knowledge, relationships and appetite. thing at the right time for our customers, and concessions. It’s the right thing to do we’ll come out the other side together with for the customer and ultimately it’s the right What are the limitations of technology right our reputations and credibility stronger thing to do for us – as a specialist lender, now – I know it’s handled the working from than ever before. n we’re here for the long term. And it’s not home challenge very well, but have we been just financial support: our relationship surprised by what it can and can’t do? managers have very small portfolios and The entire sector has had to adapt they know their customers very well, so in extraordinarily quickly. Technology, on “We knew Shawbrook had many ways we’re simply a friendly ear at the whole, has helped with that. Remote the end of the phone. working at such speed and scale simply the sector experience, so couldn’t have happened without the they clearly understood the And what about continuing to support tech and infrastructure we’ve got today. dynamics of our business, businesses that are still growing and But data is increasingly key. We’re now looking for new lending? collecting and analysing data points and but they also recognised Even at the best of times, certainty matters information that either didn’t exist or was the opportunities that – let alone in times like these. So we’ve of no interest before this crisis hit. So await us post-pandemic. been absolutely focused on delivering the where technology is now most essential, commitments we made pre-lockdown, but where there’s still a long way to go, is in We’re very happy to be despite the obvious logistical challenges. the world of data analysis and management working with a lender that We were on track to deliver a record first information. While larger institutions will has bought into our plans quarter performance and we’ve carried always suffer in this regard, having to rely a lot of that momentum forward, on complex legacy systems, this is where and is willing to back our getting new facilities paid out across all new and specialist providers can really future growth.” sectors and products. differentiate and make significant gains In technology, healthcare and agriculture over the coming years. It’s a trend we’ve Kevin Timms, CEO eacs Ltd in particular we’ve also seen plenty of new seen unfolding, but will now accelerate. www.leasingworld.co.uk VOL 13 I NO 150 2020 15 FEATURE How the NACFB took its Expo online How do you take a two-thousand-guest event in a four-thousand-square-metre indoor space, and transform it into an online gathering? hat was the problem faced by the Aldermore explained the ways they had many behind-the-scenes workers at found to support and guide their brokers Tthe NACFB, and they came up with in the absence of a formal physical a creative solution. gathering, saying, “We’re not letting the The doing business and networking lockdown stop us making connections side of the event may need to wait until and offering support.” And Haydock another forum and another eon, but the celebrated forty years of asset funding by Commercial Finance Expo has also long looking forward to the next forty – but been touted as “one of few places that we hope there will be an official birthday brokers can see all their lenders and cake before the year is out! funders in one place on the same day.” Russ sharing his combat experiences What we appreciated particularly And that’s the part that the NACFB was from Afghanistan, drawing out relevant about the format of the Online Expo was able to provide online this year, on the themes that can be applied to our current the knowledge that around the country same day as the full NEC event had been circumstances, including an anecdote virtual attendees had all come together planned, Wednesday 17 June. of what it means to be ‘the good guys’ in one online space at the same time. It With fourteen Vimeo video presentations in challenging environments – that the gave the occasion the real sense of being totalling five hours of viewing, this was world has a long memory for how people a live event, which – given that we can’t in some ways arguably an even better behave when the chips are down. have all the full NEC monty – made for experience than ‘the real thing’ since you Haydock, Aldermore and Funding an enjoyable and involving substitute. could create your own programme of Circle were among the other exhibitors That said, we’re looking forward more timings and order of presentations, and no who were giving presentations on the day. than ever to a resumption of offline rather fears of hold-ups on the M6. Funding Circle walked brokers through than online events, and we don’t have so NACFB director Russ Lewis featured in its “Virtual Funderpark”, detailing the very long to wait, as next year’s Commercial Shawbrook’s first ever live virtual broker changes the peer-to-peer funder has made Finance Expo is on the earlier-than-normal event. The hour-long session included in adapting to the current time. date of Wednesday 24 March. n Half of brokers fully open for business 53pct of property and commercial finance brokers responding to United Trust Bank’s most recent Broker Sentiment Survey have reported that they are open for business with 100pct of their pre-Covid-19 capacity. A further 18pct are operating at around 75pct capacity.
he survey, carried out amongst over CAPACITY TO TRANSACT BACK TO WORK 120 brokers in the last week of June, Describe the current status % of What % of staff are typically % of Trevealed a largely positive view about of your company Brokers working in the office? Brokers their ability to recover from the effects of Open with full pre-Covid 19 capacity 53% All of them 20% the Covid-19 lockdown. Although 40pct of brokers are currently operating with Open with around 75% capacity 18% Around 75% 9% less than a quarter of their staff typically in Open with around 50% capacity 20% Around 50% 23% the office, 72pct of respondents expected Open with around 25% capacity 7% Around 25% 8% to have all their staff back working in Currently closed 2% Less than 25% 40% the office on a regular basis by the end of October 2020. year and generally expected the recovery investment in FinTech over the last two Interestingly, 17pct of brokers indicated to come in 2021 or later. Harley Kagan, years has been money well spent. that it was unlikely their business would Group Managing Director of United Trust “The threat of a second wave of ever return to the working arrangements Bank, commented, “It’s encouraging to Covid-19 is ever present and avoiding which existed before the lockdown. 63pct see that a vast majority of brokers are another widespread lockdown is vital to of brokers suggested that they would be open for business with many capable of the recovery of our industry and the UK likely to maintain flexible and more home dealing with enquiry volumes similar to economy as a whole. Recent events in working even once the pandemic is over. those prior to lockdown. Technology has Leicester show how easily the pandemic Asset finance brokers were finding certainly made flexible and home working can resurface and extend disruption and the market challenging. 83pct were a viable and sustainable option for we hope brokers, colleagues and customers experiencing less activity than this time last many businesses and UTB’s considerable stay safe and well.” n
16 VOL 13 I NO 150 2020 www.leasingworld.co.uk OBITUARY
Sean Williams 1965-2020 The leasing community is mourning the loss of Sean Williams, who passed away on 20 June after four years fighting cancer. Lord Parry Mitchell agreed to give us his personal response to Sean’s passing.
Ours was an unlikely relationship. When we first met he was 28 and I was 49, a big difference, but it clicked. Anyone who met Sean was captivated by his broad smile, his charm, his powerful brain and his dedication to hard work. Sean never gave up. He was also supportive – whenever the going got tough he was there, always reassuring and always positive. He was the consummate entrepreneur. He was also an amazing sportsman. Together with his brother and dad, Sean cycled across America in 21 days – think of it! 120 miles every day across mountains and plains in the middle of summer. Not content with that, he did the same across Australia and then again across y business partner of 28 years and my dear friend Southern Africa. For him, giving up was never an option. Sean Williams passed away on 20th June 2020. Sean He also loved deep sea fishing and last October together Mwas a month shy of 55. Sean was the co-founder of with our co-directors at Instant Impact we joined him The Systems House, which then became Syscap and until on his very cool fishing boat in Falmouth Harbour. The 2006 when the company was sold, he was the beating heart photo above says everything, the joy on his face holding of the company. a mackerel as a bait for the ultimate prize of a blue fin Sean started work in the leasing industry at Lloyds tuna, which he would tag and release. Even though he was Bowmaker. He then left to co-found The Systems House, and desperately ill when the photo was taken, it shows him in when I first met him in 1992 he was working from a small his element having fun. office in Northcote Road, Clapham, just opposite the IRA Sean had been ill with cancer for nearly four years. He pub – not exactly a salubrious setting. Nonetheless the office was under no illusions and he fought the disease with stoic radiated electricity, full of activity. My first recollection of determination, being positive and realistic at the same him was this force of nature sitting behind a pile of yellow time. He knew the odds. pages directories, phoning everyone in sight looking for a Two weeks before he passed away my wife and I were leasing deal. Syscap’s business then was as a lease broker, able to visit him at his home in Fulham, we sat in the closing a deal then placing it and pocketing their 10pct sunshine in his garden and although we never said the word commission. It was fast and furious and I loved it. ‘goodbye’ we knew it would be our last time of meeting. Syscap prospered and when they were bought by Because of Covid-19 we kept our distance, it denied us the Anacap in 2006, their annual volume of leasing deals opportunity of giving him a big and final hug. was approaching £200 million. Sean and I between us negotiated a deal that many said would be impossible to Sean leaves behind his wonderful wife Karen and his two achieve, but we were a great team and together we obtained grown up children Georgi and Harry. With them we mourn a great price for the company. him and we will miss him terribly.
Philip White, Director at FinTech Financial Partners enjoyed in the early days at Syscap. For me he was one of Limited, described his regret at “the sad loss of my one the great minds of our industry, fiercely competitive but also time business partner, sometime mentor and always friend, kind hearted, and an inspirational leader. Curly the Bullfighter. A committed family man with an unquestionable zest for life. Certainly a fully paid up, if not founding member of the work hard/play hard club. ➔ He was one of the great minds of Unquestionably the toughest, both physically and mentally our industry. person I have ever met, and in my own rehab challenges Sean was a real inspiration. One of the many words of wisdom that will be with me forever will be that “Everything in life He set the standard for the work hard / play hard mantra has an end, except a sausage...which has two.” that we all lived by – I could barely keep up with him even in my early twenties! The legend that is Sean “Curly” Nathan Mollett, Director at Metro Bank Asset Finance, said, Williams lives on in all of those who were lucky enough to “Sean was the driving force behind the incredible culture we work with him.”
www.leasingworld.co.uk VOL 13 I NO 150 2020 17 FEATURE If you think training is expensive, try ignorance While the need to impart knowledge and update existing asset finance skillsets is as crucial as it ever was, we cannot corral students together in training rooms anymore. Books can’t be updated fast enough to match the pace of political change in our industry. So how will asset finance training and education actually be happening in the summer of 2020?
he Finance and Leasing Association fresh. There is a follow-up a few days (“FLA”) offers FLA Talks, one ➔ The old days of ‘lead later, when each regional Sales Manager Teach week. We were told, “We’ve is invited to a one-to-one session. had more than forty attendees, full and with leasing’ are Many in our industry recall coming associate members, for each one we’ve long gone! up through the large banks and finding done so far, and as each Talk is only ten a strong emphasis on in-house training minutes long, it doesn’t impact too much which has since fallen out of fashion. on the working day.” Mike Ramsay observes that now, “there’s Training courses like these, when they Mike Ramsay, Director, and owner of little to no in-house sales development were face-to-face events, used to have Persona Sales Training has been running for salespeople.” It’s not uncommon to a duration from one to three days, but his business for a quarter of a century, work with teams who have had no sales are now more likely to last one to three so he has seen the way training has training for five to ten years or more. hours. “They’ll have a live trainer online, handled economic downturns before. He Mike adds, “The old days of ‘lead with in smaller groups,” says Simon Goldie, says, “We train sales techniques, and the leasing’ are long gone. Now it’s about Head of Asset Finance at the Finance & techniques that work have changed. So helping clients to buy, making it easy to Leasing Association (“FLA”), “and these we’ve had to adapt what we teach, as well buy. You can’t waste time waiting for groups are fully booked.” By reducing as how we teach it.” someone to ask for a lease. You must the sizes of groups, the FLA has increased Persona makes sure there’s a co- be proactive and integrate the financial its own workload, in order to keep the ordinator in attendance to handle the solution perspective. personal touch in each session – as much chatroom questions. Students have the “And ‘How to handle the price as is possible, at any rate – with the move chance to input their questions in real objections’ is a nonsense in the modern to online working. time, which keeps it all feeling live and world. Today it’s about business cases.
18 VOL 13 I NO 150 2020 www.leasingworld.co.uk FEATURE
You don’t sell an asset by talking about effectiveness of paying for a service that set of online training sessions on July its outright upfront price. Instead you say, doesn’t yield immediate results or bring 27. Each session will be tailored for the “Let’s see if we can justify your £28-35 in tangible new assets. needs of around a dozen students in a per day (for example) – a machine is a So how do you put a value on a training training programme that will run for great asset as an employee, imagine what course? It’s easy to see what it costs, three consecutive Mondays. And the work you’d get from an employee on harder to pin a hard and fast figure on the programme’s reach is international. Mike investment per day!” All this regardless extra income effective training generates. explains, “We have morning sessions in of whether the customer chooses to Responding to this question, Mike Japan, Singapore and Korea, which we’ll purchase or finance! Ramsay admits, “You never really know be running at 7am BST, and an afternoon Mike talked to us about the four till you start (whether training online session for the Middle East and Africa, company states: Growth, Trouble, Even is effective) – you don’t know how at 2pm BST.” The 7am start shouldn’t Keel and Overconfident. Businesses in proactive, how involved some people will be a problem, as Mike explains, “If we two of those states tend not to be receptive be.” And one imagines such assessments were doing this the traditional workshop to training and education because things are a little trickier when attendee students method, I’d be on the motorway at seem to be fine. If your company is in are effectively invisible. If you have 5:30am!” the Even Keel or the Overconfident dozens or even hundreds of participants, state, you may wonder why you’d risk they won’t all show up on the screen of ➔ changing a winning formula? Why rock a classic 2020-era Zoom call. So steps Our diploma arms the boat? This doesn’t mean, of course, have to be taken to maintain a personal people with the ability that there is no place for training in those element as much as possible. businesses, but the door won’t open That said, when you’re selling sales to deal with things easily. In contrast, firms that are anxious training, assessing the benefits of the like CBILS, when to grow, or keen to pull themselves out training is perhaps relatively easy, because of a problematic situation, will be actively it’s not hard to visualise the difference they appear ready to accept help. between a successful deal and the lost customer that gets away from you. Interest in training courses is reported “No Decision” outcomes are still most to be strong, but it seems certain that ➔ You don’t know companies’ biggest competitor. many furloughed workers have not how proactive, how “Without us saying something,” says taken advantage of all the many training Mike, “many clients simply don’t monitor opportunities open to them over the past involved some people what percentage of deals get financed, it’s four months. This should, at least keep will be not monitored. But good clients know the trainers busy in the Return to Work phase worth of integrating financial solutions, especially if there is an energetic ‘re- the real value to their business and their opening’ spirit in the air. And by then of The clear benefits of training to Even sales teams. So they understand the value course, there may be more business help Keel and Overconfident businesses are of the training that will help to achieve schemes and products to learn about. that both need to be preparing for the these goals.” We asked whether younger students future just like any company. In business, After taking FLA courses, the were more likely to commit to taking training can help fight the danger of committed student will naturally want on more training courses than the more standing still. Businesses, and the people and choose to move on to take the established professionals. Simon Goldie, who run them, can also get defensive diploma. “And the diploma is regularly Head of Asset Finance at the FLA, about training and education. While updated,” says Simon Goldie. “It covers explained: “I used to visit a number of large businesses can regard training as a IFRS16, for example. It doesn’t talk FLA member firms, and I remember sine qua non, smaller firms can find it’s about CBILS but it does cover EFG and being struck by the diversity of age…but the kind of thing that only ever gets up since CBILS is based on EFG we haven’t it is broadly true that younger workers to fourth or third on the priority list, needed to make big revisions.” will use our training more than older never the top. Question someone’s use of No training qualification written in members.” This does not suggest there is training, and they feel you’re questioning 2019 will have provided 100 percent a skills gap between different generations the capability of the business – which instruction for today’s brave new world, or ages, rather than one group is keen to may, after all, be doing extremely well. full of new hard-to-pronounce acronyms catch up the other! One correspondent told Leasing World like CBILS, since they hadn’t been In all training there is an element of that “our new HR manager felt certain dreamed up (and would presumably have starting with a blank slate, of taking new they could do everything a training been considered unaffordable) last year. knowledge and doing new things with company could do.” And with the right Simon Goldie explains, “Our diploma that knowledge. And while everyone HR manager, that’s not impossible. But a arms people with the ability to deal is reluctant to make predictions about training company should be able to focus with things like CBILS, when they appear. Q4 2020, it would be nice to think it completely on training, and you might It’s a stable base, giving the student will be a period of rebirth of the leasing expect an HR manager to have several strong foundations of understanding industry, and a time to put new training other demands on their time. when it comes to regulations, into practice. If that’s the case, then right Not everyone believes they can keep underwriting and marketing sales now is the time to pick up new skills; a all necessary training in house, and process. And then the student can go positive sign, then, that trainers are being that’s where Persona and the FLA, out into the real world and apply what kept busy. n among others, find an opening. The next they’ve learned to new situations.” challenge is to demonstrate the cost- Persona Sales Training will start a new Robin Skuse, Leasing World www.leasingworld.co.uk VOL 13 I NO 150 2020 19 CITY NEWS
CITYNEWS
New CEO at Close Brothers 1pm “strategically well-placed” The Board of Close Brothers Group plc (“Close Brothers” or “the group”) has announced that Adrian Sainsbury has been for return to growth selected to succeed Preben Prebensen as Chief Executive. Adrian 1pm plc (“1pm”, the “Group” or the “Company”) has cited new will take up the new position, and become an Executive Director term loan funding of £3.1 million for operations, and further of the group, with effect from 21 September 2020. Adrian's new and reallocated funding of £6.3 million for Coronavirus appointment follows an extensive search process undertaken by Business Interruption Loan Scheme (“CBILS”) lending, in its the Board, considering both internal and external candidates, latest trading update for the financial year ended 31 May 2020. following the announcement in September 2019 of Preben’s 1pm plc has obtained additional funding of £3.1 million for its planned departure. own business operations and has arranged new and reallocated Adrian has been Managing Director of Close Brothers’ Banking funding facilities of £6.3 million to deploy as a lending partner division and a member of the group Executive Committee since under CBILS. November 2016, having joined Close Brothers in 2013 as Chief During the year, the Group experienced three quarters of Executive of the Commercial division. He became a director ‘normal’ trading activity and one quarter, 1 March to 31 May of Close Brothers Limited, the group’s principal Banking 2020, impacted by the effects of the Covid-19 pandemic. subsidiary, in August 2013. Adrian has previously held New business origination for the financial year was executive roles at Barclays, RBS and Bank of Ireland and was approximately £147.0 million of which approximately £54.5 Chief Executive of ANZ Bank in Europe. million (37pct) was written on ‘own-book’ and £92.5 million Preben Prebensen will formally step down as Chief Executive (63pct) was placed for broker commission income. and a member of the Board on 21 September 2020. Chairman Mike Biggs said, “I am delighted to announce the appointment of Adrian Sainsbury as Chief Executive. His deep ➔ The Group has not seen a significant knowledge and experience, strong leadership and exceptional commercial expertise make him ideally placed to lead the increase in borrower insolvencies group through the next stage of its development. Adrian's and resulting portfolio write-offs appointment provides continuity in the group's leadership team and business model, ensuring that that we continue delivering for our people, our customers, and our shareholders in the As at 31 May 2020, the Group had granted forbearance years to come. totalling £0.9 million to customers in respect of leases and loan “The Board would like to thank Preben Prebensen for his deals with a portfolio value of £24.9 million, representing 20 outstanding leadership and very significant contribution over per cent of the Group’s receivables. The strength of the Group’s the last eleven years. He has overseen the transformation of balance sheet has enabled this forbearance to be granted without the group over this period and leaves it in an excellent position the Group needing to request similar forbearance from its own operationally and financially and with a strong executive team. funding partners. This has enabled the Group to stay open for On behalf of the Board I wish Preben the very best for the future.” new business throughout the period. Adrian Sainsbury said, “I am honoured to be appointed Ongoing support from funding partners, plus the spread and Chief Executive of Close Brothers. Our group has a long and size of funding facilities available to it has resulted in the Group successful track record built on the experience and expertise being well-equipped to maximise the opportunities that will be of our people, strong customer relationships, and a prudent presented as the economy recovers. approach to managing our business. I look forward to taking There was no material increase in bad debt write-offs had this proven and successful business model forward in the years occurred as a result of Covid-19 as at 31 May 2020 due to large to come.” numbers of UK SMEs being able to access funding through the Preben Prebensen said, “I am delighted that Adrian has availability of the Government’s temporary Covid-19 financial been appointed as Close Brothers’ next chief executive. We support schemes. A decision has been taken, however, to increase have worked together for seven years and Adrian’s drive, his the bad debt provision as at 31 May 2020, as set out below, as a breadth of experience and his deep knowledge of our banking prudent governance measure. businesses have been very clear throughout that time. I am very Revenue for the year is expected to be £29.1 million (FY 2019: pleased to be leaving the group in such capable hands.” £31.8 million) of which approximately 80pct is from lending
20 VOL 13 I NO 150 2020 www.leasingworld.co.uk CITY NEWS
activities and 20 per cent from broking activities. a number of board positions in the UK and the Middle East at PBTE for the year expected to be approximately £3.0 million companies including Vaultex Limited (a joint venture between (FY 2019: £8.1 million), stated after a ‘one-off’ increase in HSBC and Barclays), Aldermore Bank plc, Barclays Pension the bad debt provision of £2.1 million recorded in the fourth Trustees Limited, LSL Properties plc, George Wimpey plc and quarter of the financial year to mitigate any potential bad debts Al Rayan Bank plc. that may arise in the future from the impact of Covid-19. Robert Sharpe says: “I’m delighted to have been appointed as A similar level of net portfolio write-offs to the prior year was Metro Bank's Chairman and look forward to leading the Board incurred, representing under 2.0pct of the net lending portfolio, and supporting Dan Frumkin and the executive team as they but provisions have been prudently increased to approximately continue to deliver on the reinvigorated strategy…Community 5.2pct or £5.1 million (31 May 2019 1.9pct or £2.4m). banking has never been more important as people, businesses Net assets at 31 May 2020 were in excess of £55.0 million and communities adapt to this new normal.” (31 May 2019: £53.8 million) and borrowing facilities as at 31 May 2020 were in excess of £180 million (31 May 2019: £167 million) with the blended cost of borrowing maintained Secure Trust Bank issues AGM at approximately 4pct. There is reportedly good visibility of future revenue already trading update secured with “unearned income” as at 31 May 2020 of over Following the Annual General Meeting of Secure Trust Bank £15 million. PLC (the ‘Bank’ or ‘STB’ or ‘Group’) held in late June, the Cash balances, including the proceeds of new term loan Board of STB has published an update on trading in the first funding, amount to £4.2 million as at 22 June 2020. In addition five months of the year, which follows the first quarter update the Group has a currently unutilised overdraft facility of provided with the 2019 Annual Results on 7 May 2020. £1.0 million. Having entered 2020 aspiring to deliver double digit profit Ian Smith, Chief Executive Officer, commented, “The Group growth for the third successive year, the Group was on track to has not seen a significant increase in borrower insolvencies deliver this objective until the onset of the Covid-19 outbreak and resulting portfolio write-offs. In accordance with the and UK lockdown in late March. Group’s cautious policies the Board has, however, decided to account for an additional bad debt provision as at 31 May 2020 as a prudent measure. This additional charge has ➔ STB reports increased recent reduced profit before tax for the financial year, but is considered an appropriate step to take in the current economic demand for consumer finance, circumstances. particularly in motor finance “The Group is well-funded and supported, well-resourced with an experienced management team and strategically well-placed to not only withstand the business impact of the While the Group has continued to trade profitably since pandemic, but also to return to strong and stable growth.” the lockdown, the lockdown has led to significantly reduced Further, the Group has agreed a £3.1 million five year term new lending volumes written in April and May, particularly loan with its principal bank, NatWest (the “Term Loan”). in motor finance, invoice finance and real estate finance. The proceeds of the Term Loan will supplement the Group’s Noting the majority of our retail finance business is online the existing cash resources and will provide significant additional Group is well placed to continue supporting existing retailer liquidity for the Group in offsetting the impact of Covid-19 on relationships, with volumes running around 50pct of normal its business operations. levels. Support has also been provided to SME customers, where appropriate, via government loan schemes. As a result, and as previously disclosed, the Bank’s short duration balance Metro Bank Plc appoints Robert sheet has been contracting since April and the Group expects this to continue for the foreseeable future. This has resulted Sharpe as Chairman in stronger capital and liquidity ratios relative to the position Metro Bank announced on 8 July the appointment of Robert at the end of 2019. Sharpe as Chairman. It’s anticipated that Robert will commence The recent partial easing of the lockdown has resulted the role from 1 November 2020, subject to regulatory approval in increased demand for consumer finance in recent weeks, He will succeed Sir Michael Snyder, who was appointed Interim particularly in motor finance where used car prices appear to Chairman in October last year while a thorough search and have hardened. Whether this is due to pent-up demand or a selection process for a permanent successor was undertaken. Sir more sustained trend remains to be seen and the volume of Michael Snyder will continue as Interim Chairman until Robert motor finance business written by the Group remains low. joins the Bank. Activity levels in retail finance have risen and will rise due to Robert has a wealth of Board and Executive-level experience the relaxation of the social distancing requirements and the in the retail banking sector. During his Executive career, he imminent launch of 2020-2021 season ticket sales by Premier led the transformation of West Bromwich Building Society as League clubs. Demand for SME lending is subdued, which Chief Executive Officer, having formerly been Chief Executive may be linked to take up of the government loan schemes. at the Portman Building Society and Chief Executive of Bank of The heightened levels of uncertainty are also informing Ireland’s consumer business in the UK. the Group’s credit risk appetite, which is expected to remain The incoming Chairman currently acts as Chairman at cautious for some time. Bank of Ireland UK, Hampshire Trust Bank and Honeycomb The Group states that its healthy capital and liquidity Investment Trust plc. He will be stepping down from his position positions, flexible business model and short duration loan at Bank of Ireland UK in due course. Robert has previously held portfolio make it well placed to navigate the current crisis. www.leasingworld.co.uk VOL 13 I NO 150 2020 21 LEGAL
Approved Persons Regime Front of mind (“APR”) and coronavirus: the FCA makes its Joanne Davis expectations clear The FCA sets out its expectations to help benchmark administrators and firms using Appointed Representative (“AR”) arrangements apply the Approved Persons Regime (APR) during coronavirus (Covid-19). The FCA in its Understanding the 12-week rule announcement states that they recognise that firms may need longer periods of temporary arrangements if, for example, an Approved Person is absent because of he FCA made two important time to finalise its policy as soon as coronavirus, or if recruitment to replace announcements surrounding possible. an Approved Person has been delayed TCovid-19 at the end of June as The FCA reminds firms that Senior due to the pandemic. follows:- Managers must ensure that Conduct The FCA has published its expectations Rules training is effective, so that staff on the Senior Managers & Certification are aware of the Conduct Rules and Regime (“SM&CR”) for solo regulated Extension of the Senior understand how they apply to them firms and for dual regulated firms with in their jobs. The FCA comments that the Prudential Regulation Authority Managers & Certification these programmes will require planning, (“PRA”). Firms that have not read these Regime (“SM&CR”) time and effort to deliver effectively. are urged to do so. implementation periods for The FCA is expected to produce further communications about its expectations. In relation to the temporary solo-regulated firms. Firms should continue with their arrangements for controlled functions, The deadline for solo-regulated firms programmes of work in these areas and, the FCA has effectively extended the to have undertaken the first assessment if they are able to certify staff earlier period in which an individual may cover of the fitness and propriety of their than March 2021, they should do so. for a senior manager during the Covid-19 Certified Persons has been delayed from The FCA goes on to add that that Firms pandemic by up to 36 weeks. 9 December 2020 until 31 March 2021. should not wait to remove staff who are Effectively, the 12-week rule allows The Treasury has agreed to delay, from not fit and proper from certified roles. an individual to cover for a senior 9 December 2020 until 31 March 2021, The FCA still plans to publish details manager without being approved, where the deadline for solo regulated firms to of certified employees of solo firms the absence is temporary or reasonably have undertaken the first assessment starting from 9 December 2020 on the unforeseen, and the appointment is for of the fitness and propriety of their Financial Services Register. Where firms less than 12 consecutive weeks. The Certified Persons. This will give firms can provide this information before FCA recognises that ARs have had significantly affected by the coronavirus March 2021, the FCA encourages firms to make temporary arrangements to pandemic time to make the changes to do so. cover absences in direct response to the they need. To ensure SM&CR deadlines remain consistent, and to provide extra time for firms that need it, the FCA intends to consult on extending the deadline for the following requirements from 9 December 2020 to 31 March 2021:
• the date the Conduct Rules come into force • the deadline for submission of information about Directory Persons to the Register • references in the FCA rules to the deadline for assessing Certified Persons as fit and proper (which has been agreed by the Treasury) To give regulated firms certainty, the FCA intend to consult alongside parliamentary process, to allow them
22 VOL 13 I NO 150 2020 www.leasingworld.co.uk LEGAL
pandemic and that this uncertainty has for example due to illness, caring that their ARs do the same. not yet been resolved. To provide further responsibilities or if they have no current And finally on the subject of flexibility to firms at this time, the FCA practical responsibilities. The rule is Responsibilities of the Principal firm, in its announcement state that they intend that unless an individual is permanently regulated firms that use ARs to carry to issue a modification by consent to the leaving their post, they can retain their on regulated activity remain responsible 12 week rule, which will allow temporary approval during their absence and will for their ARs and networks to meet the arrangements for up to the 36 weeks. not need to be re-approved by the FCA FCA rules. Principals should continue If temporary arrangements last longer when they return. The principal is still to ensure that: than 12-weeks as a result of the crisis, responsible for ensuring the Approved • the controllers, directors, partners, firms will be able to notify the FCA that Person is fit and proper. proprietors and managers of an AR they consent to a modification of the In relation to notification and are fit and proper 12-week rule. In these cases, temporary documentation, the FCA does not • the AR is solvent and suitable to act arrangements can last up to 36 weeks. expect firms to notify them under Form for the firm If the modification by consent is being D of the temporary arrangements . • the principal has adequate controls used in relation to an AR, the Principal However, the FCA does expect these over the AR’s activities – rather than the AR – should notify the arrangements (however temporary) to • the appointment does not prevent the FCA. The FCA states that roles requiring be clearly documented internally, so that firm from satisfying and continuing approval under the customer function everyone understands who is responsible to satisfy the threshold conditions (“CF30”) cannot be covered using the 12- for what. This should be available if • the principal is able to monitor and week rule. The modification by consent the FCA request it either now or in the enforce compliance with relevant does vary this exclusion. future. The FCA make it clear that firms’ requirements. n In relation to furloughed staff, the internal records should aim to keep a FCA states that there may be cases where ‘running commentary’ of their personnel For further information or support benchmark administrators or ARs decide performing significant influence functions regarding these rules or conduct rule to furlough Approved Persons if they and their responsibilities during this training requirements, please contact are unable to fulfil their responsibilities, period and that firms should make sure Joanne Davis on 07741 240114.
YOUR WINDOW INTO THE BROKER’S WORLD
For hard copy email [email protected] or for digital APP look up BrokerWorld on iTunes or Google Play
SUBSCRIBE TO BROKERWORLD MAGAZINE, NOW INTO ITS EIGHTH YEAR!
www.leasingworld.co.uk VOL 13 I NO 150 2020 23 FEATURE Managing in the age of Covid-19 and beyond Patrick Dunne is visiting professor at Cranfield School of Management part of Cranfield University. He enjoyed a long career with 3i, the private equity group, and now has a close association with EY (formerly Ernst & Young), the professional services group. He has given three interviews at the management school on the impact of Covid-19 on the business world and Leasing World’s contributing editor Allan Foad listened in. This article is Alan’s attempt to disseminate Dunne’s views and to interlace them with some of Alan’s own.
however, should be fully understood. Dunne believes that stars will emerge to master this crisis but they will not be the leaders of the future. I would contend that Winston Churchill was a great wartime leader i.e. crisis manager, but he was less distinguished as a peacetime prime minister. Some would argue that was due to age and exhaustion and I partly agree, but I think the main reason was because he lacked a vision for a modern Britain. Boards need to identify good crisis managers to lead their companies now but they should also be looking for those with the qualities to lead in the new normal that lies ahead. Undoubtedly these are tough times for chief executives who, as well as working all hours, might also have to take pay cuts. Dunne believes that to lead in this crisis they need three qualities starting with Judgement. Making the right unne’s opening position is that responsibility of the chairman to make decisions will be crucial for the survival immediately coronavirus struck sure all are heard. of the business. Inter-Personal Skills Dmany businesses had to move The chairman in particular must engage are essential to manage conflict and from managing for profit to fighting closely with the chief executive who will persuade stakeholders to continue with for survival. This was challenging for be working extremely hard under intense their support, to project an air of calm company boards but he felt those that pressure, and, in parallel, other non- but not casualness, and to communicate were properly recruited and well-balanced executives should lend their support to the clearly particularly with difficult with the right spread of talents should executive team. It is vital that both execs messages. He makes a veiled sideswipe at be up to the task. I wonder, however, and non-execs agree the way forward and the government for delivering messages how those drawn from the chums of the work in unison, but the non-execs should without command of the full detail. The chairman have performed? avoid the temptation to act as executives. third quality he calls Antennae. This The board’s primary responsibilities This will only cause confusion and hinder is an abstract concept somewhat akin remain to identify the best strategic the management team. to having a sixth sense and is about direction for the business and to ensure No one has managed in conditions like intuitively differentiating between the good corporate governance but, under this before, the situation is constantly right and the wrong. the shadow of coronavirus, it needs to changing, and the future is uncertain. Under the coronavirus cloud the chief operate differently. During the crisis the To survive, businesses must be nimble executive will be called upon to take a directors need to meet more frequently and decisions need to be taken quickly. plethora of decisions and will not be but Dunne recommends with fewer Analysis paralysis could prove fatal. physically capable of making them all. As formal meetings. He feels informal Dunne argues that the board should a crisis manager he will need to identify sessions are likely to be more productive look for the best information available the business critical ones which need and stimulate creativity. He warns that and rely on facts rather than opinions, prompt attention and delegate or park extroverts will be inclined to dominate but waiting for full information will lead the others. He must not allow himself to these gatherings but introverts could to decisions being taken too late. The be bogged down by trivia but equally he be more interesting. He sees it as the quality of the information being used, must not neglect something that proves to
24 VOL 13 I NO 150 2020 www.leasingworld.co.uk FEATURE
be business critical later. Not easy. and working to overly tight schedules. as Dunne prefers to call it, became the The only thing we currently know about Dunne anticipates there will be a move to norm during the crisis. He estimates that the future is that there will be one. No one simplify these and carry more slack. Just before coronavirus 1.5 million people knows what the new normal will be but in time thinking will be revisited. I am not were working at home and thinks this Dunne doubts it will be the same as the old sure about this and think it will depend number rose to seven million. Companies one. For a start, he thinks risk management on whether we revert to the old brand of have now tested the homeworking model will feature higher up the agenda at board capitalism where costs always need to be and many employees have enjoyed not meetings. Coronavirus has shown the need squeezed down. commuting. He estimates that as many for contingency planning and he believes as three million will want to work from that the companies who weathered this home in the future and companies will crisis the best are those who planned for it. ➔ Dunne estimates that need to decide whether this is mutually He cites EY as an organisation that was beneficial. Sadly, a lot of people are likely able to follow a plan written assuming as many as three to lose their jobs in the early months of all of their offices were shut down and million will want to the new normal and companies will have within thirty-six hours managed to move difficult redundancy programmes to all of their 17,000 employees across to work from home in manage. This all means major personnel home working. Those without plans will the future issues to contend with in the not too have struggled. distant future. He also anticipates many companies Undoubtedly the age of Covid-19 has will want to manage for cash for the Markets are likely to be smaller after brought unprecedented challenges to the next decade and be financially cautious. the crisis and some companies will be business world and emerging into the new This certainly happened after the crash of stronger than others. Dunne sees a lot of normal is likely to be just as challenging. 2008 but it was a long haul back from consolidation on the horizon with plenty I hope I have done justice to what Dunne that recession. I am hoping this recovery of work for mergers & acquisition teams. said but feel free to listen to him yourself will be quicker and that companies will Those with the financial muscle will on the Cranfield University website. be encouraged to invest. pick up good bargains and, conversely, a Be mindful however that these are only Another thought is that this crisis has number of businesses will be pleased to his opinions, but I think they are well demonstrated companies were previously be bought. considered and provide food for thought. managing very complex supply chains Homeworking, or working from home Good luck. n
www.leasingworld.co.uk VOL 13 I NO 150 2020 25 2500 DATA 2000 1500 UK NEW BUSINESS FINANCE MAY 2020 CURRENT MONTH COMPARED 12 MONTHS TO 1000 MAY 2020 MAY 2019 MONTH MAY 2020 MAY 2019 YEARLY £M £M CHANGE % £M £M CHANGE % 500 Total comprising …. 1,187 2,997 -60% 31,089 34,937 -11% By asset1 0 Cars 152 926 -84% 8,289 9,876 -16% Other asset finance 937 1,950 -52% 20,436 22,830 -10% High value 84 40 109% 1,104 1,063 4%
By channel1
Direct finance 517 1,433 -64% 14,371 16,567 -13%
Broker finance 237 616 -62% 5,941 6,644 -11%
Sales finance 336 827 -59% 8,415 9,495 -11% High value 84 40 109% 1,104 1,063 4%
By product1
Finance leasing 174 325 -46% 3,827 4,482 -15% Operating leasing 138 587 -76% 5,957 6,991 -15% Hire purchase 698 1,745 -60% 16,631 19,071 -13%
Note1: Analysis excludes receivables Source: The Finance & Leasing Association
UK NEW BUSINESS FINANCE (13 MONTHS) NEW BUSINESS FINANCE TOTAL 3500 SALES FINANCE CARS BROKER INTRODUCTIONS
3000
2500
2000
£ MILLION 1500
1000
500
0 APR MAY JUN JULY AUG SEP OCT NOV DEC JAN FEB MAR APR MAY 2019 2020
26 VOL 13 I NO 150 2020 www.leasingworld.co.uk
NEW BUSINESS FINANCE TOTAL 0 APR MAY JUN JULY AUG SEP OCT NOV DEC JAN FEB MAR APR MAY 2019 2020 DATA
UK NEW BUSINESS FINANCE (13 MONTHS) BY PRODUCT NEW BUSINESS FINANCE TOTAL 3500 FINANCE LEASING OPERATING LEASING HIRE PURCHASE
3000
2500
2000
£ MILLION 1500
9000 1000 8000 7000 6000 500 5000 4000 3000 0 2000 APR MAY JUN JULY AUG SEP OCT NOV DEC JAN FEB MAR APR MAY 1000 2019 2020 0
UK NEW BUSINESS FINANCE QUARTERLY COMPARISONS
NEW BUSINESS FINANCE TOTAL SALES FINANCE CARS BROKER INTRODUCTIONS FINANCE LEASING OPERATING LEASING HIRE PURCHASE
Q1: JAN-MAR Q2: APR-JUN 9000 9000 9000 8000 8000 8000 7000 7000 7000 6000 6000 6000 5000 5000 5000 4000 4000 4000 3000 3000 3000 2000 2000 2000 1000 1000 1000 0 0 0 2017 Q1 2018 Q1 2019 Q1 2020 Q1 2016 Q2 2017 Q2 2018 Q2 2019 Q2
Q3: JUL-SEP Q4: OCT-DEC 10000 9000 9000 8000 8000 7000 7000 6000 6000 5000 5000 4000 4000 3000 3000 2000 2000 1000 1000 0 0 2016 Q3 2017 Q3 2018 Q3 2019 Q3 2016 Q4 2017 Q4 2018 Q4 2019 Q4
www.leasingworld.co.uk VOL 13 I NO 150 2020 27 CITY CHATTER
CITYCHATTER
break the ice. However, the best bit was the after-work drink in Old Moore Looks Back the local pub nearest the office. I was famous for introducing a It’s the 150th edition of Leasing World this month and in ‘Creep of the Week Contest’ honour of this auspicious occasion the editor suggested that the City Chatter reporter (“CCR”) should interview Moore face to CCR: How did that work? face (from a safe distance) and get his recollections of the last decade or so. After all he has featured in almost every edition! Moore: I suggested to the boss that he should start a weekly contest. I explained that whoever he decided was the winner would not have to buy any drinks on a Friday after work. CCR: How did you get into leasing? Members would all try to do all sorts of favours to the boss hoping to be chosen. The boss loved it and said, “Moore you Moore: Like many of us I started at one of the major banks are definitely the first Creep of the Week for suggesting it.” It and as part of my career development I was posted to the actually produced an excellent competitive environment in the bank’s leasing division. In those days there was substantial office and a brilliant comradery to be celebrated each Friday. government support to encourage capital expenditure giving 100pct capital allowances for the whole cost. This allowance CCR: Do you remember how we met? was extended to leasing companies if they became the owners of the equipment under a lease agreement. Moore: I seem to remember we met at one of the first At first we were treated as ‘poor man’s’ division in the bank conferences sponsored by Leasing World magazine. We had a but as our volumes grew we became more important. few drinks after and then a couple of lunches which My boss used to say, “The difference between became a regular event. I was so pleased that our leases and the bank’s loans is that we once I had retired you involved me in both lend to credit worthy customers Leasing World’s ‘City Chatter’ column but we have the security of the which enabled me to keep in touch asset and we generally get higher with the changing industry that I margins than the bank for the loved. same credit risk.” CCR: What differences do you CCR: What are your fondest see now compared with the memories? old days?
Moore: We had a lot of Moore: The products are fun as there was a strong the same – basically they drinking culture and once are all just ‘Instalment I became a new business Credit’ but the players representative we were have changed. There were encouraged to entertain our no magazines like Leasing clients. We were even given World in those early days a smoking allowance in the so the regular update early days so that we could ease each month together with into our introduction by offering BrokerWorld makes me feel like a cigarette. It worked wonders to I have never left!
28 VOL 13 I NO 150 2020 www.leasingworld.co.uk BACK IN THE OFFICE
>backintheoffice
Stop Press: Customer Service Excellence 2020 Awards
The Leasing World Customer Service Excellence Awards Looking at the list of award categories, many might be exist to give recognition and reward to asset finance teams thinking, “We deserve that Award this year.” 2020 features and individuals that have achieved exceptional standards at new categories like The Go the Extra Mile (“GEM”) award, delivering customer experience and service. In this respect, 2020 Outstanding Customer Service award, Outstanding Leadership has been a monumental year for stretching our industry to new award, as well as established categories such as Customer- heights, making these awards all the more deserved, yet the centric Champions, Best Use of Technology for Service same adversary that led us to this greater effort has caused social Excellence, Outstanding Operations Team, Best New Digital restrictions that forbid us attending a convivial and exciting Tools, and Top Broker/Funder Partnership. evening of large-scale celebration. So, we can confirm that nominations are now open, and Well, we believe that awards to recognise 2020’s Customer forms can be downloaded from the Leasing World website. Service Excellence stars are still in order, but without any health The entry fee is £195 for a single awards category, or £295 for risks! We will ensure that we hold and open the 2020 CSE unlimited entries. Shortlists will be announced on 1 September, Awards to all nomination entries as normal, that our judges entries will be judged by our panel of top judges, and all the ensure that strict standards are applied to the contenders, that contenders profiled in Leasing World magazine. winners receive their coveted trophies, and that our media Our headline sponsor Aldermore Asset Finance is committed channels fully broadcast the shortlisted and victors to all. to the principle of Customer Service Excellence, and is greatly The winners will be revealed in September’s edition of Leasing assisting us with keeping the CSE awards as a focus for our World, a very special edition of the magazine dedicated to the industry. At the same time, and with cautious optimism, we CSE awards, and the winners will receive their statuettes with have booked the Sky Garden for next year’s CSE awards their September magazine. To cap it all, we will Zoom-record dinner, on April 27th, 2021. We love the venue, and our guests each winner’s feedback and present them on our website, so it’s last year told us that they loved it too, so we want to be there going to be exciting! again, one day.
Pictures from last year’s Leasing World Customer Service Excellence Awards, at the Sky Garden www.leasingworld.co.uk VOL 13 I NO 150 2020 29 EVENTS
LEASING EVENTS CALENDAR 2020/21
At the date of going to press, Leasing World understands the events listed below will be going ahead – but this could change, so we’d highly recommend checking with the hosts of each event before finalising your plans to attend.
Date Event Address Contact
Oct 21 Leasing World Gold Awards Dinner Hilton Bankside London [email protected]
2021
Feb 24-25 Lease Conference Istanbul InterContinental Hotel, Istanbul www.thealtaconferences.com
March 3-4 Lease Conference Dubai Jumeirah Creekside Hotel, Dubai www.thealtaconferences.com
March 23 NACFB Commercial Broker Awards Edgbaston Cricket Ground, Birmingham www.commercialbrokerawards.co.uk
Leasing World Customer Service April 27 Sky Garden, London [email protected] Excellence Awards 2021
YOUR WINDOW INTO THE LEASING WORLD
For hard copy email [email protected] or subscribe online at www.leasingworld.co.uk/subscribe
SUBSCRIBE TO LEASINGWORLD MAGAZINE, NOW INTO ITS TWELFTH YEAR!
30 VOL 13 I NO 150 2020 www.leasingworld.co.uk MOVES
ON THE MOVE
n 1pm welcomes Joe Ralphs develop the panel of brokers across the announced the 1pm plc, the AIM- soft asset division. appointment of Andrew listed independent Bowyer to lead the specialist provider of Carol Roberts, Head of Asset Finance at vendor development finance facilities to UK 1pm plc, commented, “This is a thoroughly programme for the SMEs, is delighted to deserved promotion for Joe who has an Finance for Industry announce that it has excellent reputation for developing long- team. Andrew has standing relationships with his broker promoted Joe Ralphs to been tasked with actively targeting key network and delivering creative funding the new role of Head of Soft Asset Broker. equipment suppliers to be their finance solutions to their clients. partner of choice. Andrew has twenty years’ Joe steps up to the position having experience in asset finance, with the last “In what is an incredibly challenging gained over twelve years of industry six spent at a major French funder where he time for small businesses, we are doing experience and built a credible career in successfully grew both broker and vendor everything we can to support our brokers the 1pm Group. Joe worked his way up business in the industrial, commercial and their clients, and Joe is the ideal through the ranks by gaining experience employee to lead our Soft Asset Broker vehicles and construction sectors. as an underwriter and then operations division in doing so.” manager before successfully taking on a Andrew, whose new title is National role that would see him manage broker Collectively, the Group provide access to Development Manager, commented, “Having relations within the organisation. With a multi-product range of business finance grown volumes nine-fold in my last role, I’m a wealth of experience in building and solutions from asset finance, invoice looking forward to similar success at Close maintaining strong relationships with finance, commercial loans through to Brothers Asset Finance. My primary aim brokers and supporting their clients with vehicle finance. will be to develop vendor relations and I’m asset-based funding solutions, Joe now confident my hard asset experience and new takes responsibility for managing the new n Close vendor programme has new face business track record will transfer well to the business operation whilst continuing to Close Brothers Asset Finance has manufacturing sector.”
The leading provider of UK & International Executive Search Asset Finance and Equipment Leasing
®
Vendor | Captive | Sales Aid | Direct | Structured Finance
looking for a
changeof scenery?
www.newleafsearch.com Discover how we can help achieve your career objectives +44 (0) 203 740 7222
www.leasingworld.co.uk VOL 13 I NO 150 2020 31 SPECIALIST SECTOR FINANCE: AGRICULTURE | AVIATION | HEALTHCARE | MARINE | RENEWABLES | TAXI | TECHNOLOGY Finance for the pace of change
Whether your clients need finance for software, hardware or services, speak to our specialist technology team today.
At Shawbrook we offer finance solutions designed for technology investment, including variable payment terms from 1 to 5 years and finance to cover 100% of hosted or delivered software as well as variable license agreements.
Contact us today 01277 892 281 [email protected] shawbrook.co.uk/technology Together
THIS ADVERTISEMENT IS INTENDED FOR INTERMEDIARY USE ONLY AND MUST NOT BE DISTRIBUTED TO POTENTIAL CLIENTS