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Transcript

  • 1. Co-operatives in the New Agriculture Accessing Economies of Scale 18 February 1999
  • 2. Leasing is a means of effectively and efficiently increasing the scale of farm or agri-business activity
    • Leasing and the leasing industry, and
    • Why and how CULEASE exists
    My presentation touches on:
  • 3. Leasing: The Creative Financing Alternative A lease is a contractual arrangement by which the owner of the asset ( the lessor ) grants the use of his or her property to another party ( the lessee ) under certain conditions for a specific period of time.
  • 4. Potential Benefits of Leasing
    • Higher percentage financing (up to 100%)
    • Off balance sheet financing
    • Reduced payments due to residual at end of lease
    • After tax may be less than other financing options
    • Spread payment of GST and PST over contract
    • Certainty of fixed rates for full term
  • 5. What Is the Market Size?
    • Canada Equipment Sales - $67 billion in 1997
    • Equipment Sales Leased
      • Canada -17%
      • United States - 30%
      • Globally - 25%
  • 6. What is the Market Size?
    • Approximate Lease Volumes Based on 1997 Expenditures…
    • Saskatchewan $350 million
    • Manitoba $300 million
    • Alberta $1,000 million
    • Canada $11,000 million
  • 7. Kinds of Equipment Leased
    • By Top Five Sectors…
    • Saskatchewan Manitoba Alberta
    • Agriculture Manufacturing Manufacturing
    • Transportation Communications Mining / Oil
    • Communications Agriculture Finance
    • Manufacturing Finance Agriculture
    • Finance Transportation Communications
  • 8. What Is Happening in Leasing?
    • Increased use of leasing (16% up to 20-25%)
    • Greater lessee awareness & “sophistication”
    • More private label leasing arrangements
    • More lease financing of short line equipment
    • Sale lease back increasing
  • 9. What Else Is Happening in Leasing? (today, tomorrow, and in the next millennium)
  • 10. Why Credit Unions Decided to Provide Leasing Services
    • To provide an alternative form of financing
    • To service members / customers
    • To build / maintain market share
    • To strengthen existing relationships
    Full Service Anywhere, Any Time, Any Way
  • 11. Who is CULEASE Financial Services?
    • Owned by Co-operative Trust Company of Canada
    • Administered by Credit Union Central of Saskatchewan
    • Established to provide lease sales & marketing and administration services to credit unions
  • 12. Structure & Organization
    • CTCC
    • CULEASE Business
    • (CULEASE Services Unit - CUCS)
    Sales & Marketing Operations Department Specialty Finance
  • 13. What Happens Behind the Scenes? Lessee Dealer CULEASE Credit Union
  • 14. What Products Does CULEASE Provide?
    • Capital / Financial Leases …
    • General lease services
    • Dealer direct - (private label leasing services)
    • Custom lease services
    • CULEASE does not provide service to the consumer lease or automobile lease markets
  • 15. CULEASE & Agriculture
    • 75% of CULEASE leases are for agri-business
    • A lease is another tool for managing cash flow
    • Often a lease can be more flexible than a loan
    • A lease may not be right for everyone
    • Payments may be less / rates may be higher
    • Service will be excellent
  • 16. Status and Plans
    • Located in Regina - official launch in October ’98
    • 10 staff
    • More than 100 dealer outlets on the prairies
    • $25-plus million in leases under administration
    • Services in Saskatchewan, Manitoba, & Alberta
    • Plans are to double volumes during 1999
    • Regional expansion to BC, ON, and Atlantic in 2000
  • 17. Financial Leasing and Agriculture
    • Try-before-you-buy financing
    • Talk to your tax advisor
    • Read the fine print - not all leases are created equal!
  • 18.
    • Questions and Answers…
    • Voice : 1-800-409-2029 Fax: 1-800-852-9097
    • www.culeasefs.com

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