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THE ALTA INVITATIONAL

THE ALTA INVITATIONAL. The “New Normal”: The realities/forces that are driving the “New Normal”. Presented by: John C. Deane Principal May 6, 2010. The “New Normal”: Equipment Leasing & Finance Industry. Is there a “New Normal” for our industry, or not? How is “New Normal” defined?

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THE ALTA INVITATIONAL

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  1. THE ALTA INVITATIONAL The “New Normal”:The realities/forces that are driving the “New Normal” Presented by: John C. Deane Principal May 6, 2010

  2. The “New Normal”:Equipment Leasing & Finance Industry • Is there a “New Normal” for our industry, or not? • How is “New Normal” defined? • A paradigm shift? • Something that forces major changes in our business models? • Other? • Why is the search for the “New Normal” important? • Post Mortem for what contributed to the recent financial crisis • Guide for our future strategic and tactical decisions

  3. Additional Notes New Normal or Not: Major Changes & Lots of Fog, but undecided as to Paradigm Shift For Some: Threat of Being CDLA-Like Slower Growth Likely Tighter Credit Markets Probable Nimbleness Necessary Continuing Consolidation but Different (still over capacity) Must Remain Relevant to Customers Importance of New & Improved Products Important of the Use of Technology as a Competitive Advantage

  4. More Notes Much More Planning Required Account Issues of Major Importance Regulatory issues of Major Importance Declining Talent Pool For Focus on Risk Profile Pace of Change/Business Change Greater than Ever Competitive Environment is Changing

  5. The “New Normal”:Realities/Forces Driving Our Industry & Businesses1 • How would we describe the realities/forces that are driving our industry/businesses into a “New Normal”? • Materially slower growth • Ongoing tightness in the credit markets (government’s share of wallet) • Higher interest rates • Diminished U.S. position; replaced by “a surging Asia” • Much more regulation • De-leveraged balance sheets Source: examples from Standard & Poor’s Ratings Services article, The New Normal: Fundamental Changes and The New Face of Finance; January 21, 2010

  6. The “New Normal”:Realities/Forces Driving Our Industry & Businesses • Are the previous realities/forces relevant to your business? • What realities/forces would you add for the “New Normal”? • Are these realities/forces different for: • Bank Affiliates • Captives • Independents • International lessors & lenders

  7. The “New Normal”:Key Business Model Changes • Have elements of your business model changes in the context of the “New Normal”? • Customer facing elements (e.g., value proposition) • Pricing • Capital markets • Delivery systems/go to market strategy • Cost management • Investor (both debt and equity) elements • Growth expectations • Risk profile • Have these changes enhanced or diminished the soundness of your business model?

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