A bank lessor is a bank or bank affiliate that offers leasing as part of its product mix through its regular lending units, a special leasing unit within the bank, a separate leasing subsidiary or joint venture in which the bank holds a significant share and third-party lease brokers.  Banks dominate the leasing market in many countries, especially in continental Europe, where a large number of leasing companies are owned by banks – the top 20 leasing companies are either bank related or hold a banking license.  Unlike captive and independent lessors, bank lessors generally do not actively securitize their lease receivables because of their alternative favorable funding sources, such as customer deposits and direct access to the interbank market.

For most of their new business, bank lessors rely on direct origination through their customers and third-party intermediaries, such as lease brokers.  Bank lessors market small- and medium-ticket leasing to their account holding customers as an alternative to bank loans and credit through their extensive branch networks and established distribution channels.  They also actively support vendor programs by underwriting the leases of the vendors’ customers.

US Bank Affiliates* 2010
Rank** Company Net Assets (mn)
3 Banc of America Leasing $34,749.0
5 Wells Fargo Equipment Finance $27,826.0
8 CIT Group $19,328.0
13 PNC Equipment Finance $9,366.4
14 U.S. Bank Equipment Finance $8,958.1
* U.S. Bank Affiliate = Majority owned by a U.S.-based bank or financial services parent (i.e., commercial or investment bank), excluding foreign affiliates (i.e., majority owned by a foreign bank or foreign investor).

** Of the 100 largest equipment finance/leasing companies in the US.
Source: Monitordaily

Bank lessors leverage their branch network to source transactions for the syndication and private placement of leases as well as to provide securitization for non-bank lessors and finance companies.  They are generally well positioned and able to engage in lease syndication, to facilitate the securitization of leases and to use their network of affiliated financial institutions to originate leases.

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