2008-11-13 presentation to the Australian Equipment Lessor\'s Association in Sydney

1. 2008 Developments in the U.S. Equipment Finance Marketplace Presented by: Bill Verhelle, Chairman Equipment Leasing and Finance Association

4. ELFA

8. The US Economy

9. The Acquired The Acquirers

10. Credit market dislocation of historic proportions Savings & loan crisis Leveraged lending & commercial real estate crisis Technology bubble and 9-11 attack Ongoing sub-prime crisis Historical average (~ 6%) Note: GDP data is inflation adjusted Source: Bureau of Economic Analysis GDP growth Russian crisis

12. Several years of strong economic growth Note: GDP data is inflation adjusted Source: Bureau of Economic Analysis GDP Growth 2004 – 2008 trend line

13. Home prices falling Sub-prime securitization crisis Loss of confidence in rating agencies Other asset classes affected Frozen structured credit markets

14. Leverage Ratios of Major Investment Banks Source: Company Annual Reports (SEC Form 10k)

15. Historic sub-prime related write-downs ($ in billions ) Source: Reuters, as of 2008-10-17

17. U.S. Banks: Charge-offs, Reserves and Delinquencies Source: Federal Reserve

18. US Federal Reserve Survey

19. US Federal Reserve Survey

20. US Federal Reserve Survey

21. U.S. banks – quarterly delinquency Source: Federal Reserve Board

22. U.S. banks – quarterly charge offs Source: Federal Reserve Board

23. US Equip. Finance Industry * ADP Credit Corporation * Bank of America * Bank of the West * Canon Financial Services * Caterpillar Financial Services * CIT * Citicapital * De Lage Landen * Fifth Third Bank * First American Equipment Finance * GreatAmerica * Hitachi Credit America * HP Financial Services * Irwin Financial * John Deere Credit Corporation * Key Equipment Finance * Marlin Leasing Corporation * National City Commercial Corp. * RBS Asset Finance * Regions Equipment Finance * Siemens Financial Services * US Bancorp * US Express Leasing * Verizon Capital Corp * Volvo Financial Services * Wells Fargo Equipment Finance ELFA MLFI 25 Index

24. Source: 2006 ELA Survey of Industry Activity U.S. equipment finance industry charge-offs have increased only slightly Source: 2008 ELFA Survey of Equipment Finance Activity Full-Year Loss (Charge-Offs) % of Net Receivables

25. U.S. equipment finance past due receivables Source: MLFI-25

26. U.S. equipment finance losses (charge-offs) as a % of net receivables Source: MLFI-25

27. Credit approval ratios as % of all applications Source: MLFI-25

28. Equipment finance originations remain steady (in billions) Source: MLFI-25

30. Business Implications

32. Years of tightening U.S. equipment finance spreads 6.68% 6.80% 7.40% 8.30% Average pre-tax yield Average pre-tax spread Average cost of funds 8.18% Source: 2008 ELFA Survey of Equipment Finance Activity

33. The equipment leasing and finance industry is capital constrained… … Creating both opportunities and challenges. Lower Higher Depository Structured Vehicle Capital Markets Reliant Existing Credit and Capital Exposure

34. Sovereign wealth funds The return of familiar strategies Institutional Investors Depositors Pension funds Foreign pension funds Direct originators with placement capabilities Commercial Finance Borrowers Banks SIVs Asset backed securities Conduits Warehouse Lines The “Engineered Finance” Era Commercial Finance Borrowers Institutional Investors Depositors Pension funds

36. Obama!

37. US Politics

41. Bill Verhelle, Chairman Equipment Leasing and Finance Association