Challenging economic times reveal the true strengths of asset-based financing!
The current market environment makes clear what many companies overlook:
Leasing not only provides rapid access to liquidity, but also offers genuine diversification and stabilization of overall corporate financing.
The key difference lies in the underlying assessment logic.
While banks must focus on corporate creditworthiness and are largely unable to factor in collateral, leasing companies can apply a combination of customer and asset creditworthiness.
Leasing companies additionally place emphasis on the assessability and recoverability of the financed assets.
This means that a high realization value can offset — or at least improve — a weak customer credit rating.
This extends all the way to purely asset-based, credit-independent financing solutions offered by specialized providers.
This alternative perspective makes leasing valuable across the full spectrum of credit profiles,
🔹from "blue-chip" mid-sized companies with investment grade ratings
🔹to companies with higher leverage (including LBOs), through to 🔹carve-outs and restructuring situations.
The result:
🔹additional liquidity that would often not be available through traditional credit lines
🔹stable, "resilient" financing partners (due to strong collateralization)
🔹predictable installments (fixed interest rates)
🔹longer terms
🔹additional benefits such as balance sheet neutrality
In uncertain times, this stability and predictability is often more decisive than supposedly more favorable terms offered by other financing instruments.
Can you think of a more stable financing instrument for challenging market phases than leasing & hire purchase?
Feel free to also consult your trusted restructuring advisor on this topic...
Challenging economic times reveal the true strengths of asset-based financing!
