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April 2005

Vol. 3 No. 4
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ABF Journal, April 2005
April 2005

As Factoring Evolves, Players Urged to Explore New Spaces


A Global Perspective…

What in the World is Going On With Factoring?
By Thomas G. Siska, Managing Director,

So, what in the world is going on in the factoring industry? Thomas Siska of tells us simply: just about anything and everything and just about anywhere and everywhere. But, as the statistics reveal, it’s no longer about growth for growth’s sake. Factors will continue to explore new territories and when all is said and done, the endgame for players will be to stake their own claim.”

(Ref # FAC045)


International Factoring Today… A Bird’s Eye View
By Harvey S. Gross, President, HSG Services Inc.
and Managing Director, New York Institute of Credit

Factoring dates back thousands of years. In its simplest form, merchants in ancient Mesopotamia, Persia and the Orient advanced credit to distant trading partners to facilitate commerce in situations where transporting money over long distances was dangerous. As international commerce became more sophisticated and complex, the means of financing production and trade evolved, too.

(Ref # FAC046)

Asset-Based Lending In 2004:
Deal Innovation & Competition Secure ABL Product In Capital Market Offerings

By Maria C. Dikeos, Vice President/Senior Market Analyst, Loan Pricing Corporation

In a year ending with deals such as Sears Holdings’ $4 billion in play, the ABL market seems poised for more innovation and convergence.While traditional deals will not evaporate, the line between traditional asset-based borrowers and those taking advantage of expanded ABL offerings has blurred. Given current market liquidity, borrowers may continue to straddle the line between ABL and cash flow structures.

(Ref # IND061)

GMAC Commercial Finance:
Product Improves Supply Chain, Increases Cash Flow

By Cari Cuomo, Communications Coordinator, GMAC Commercial Finance

In recent years, structured trade payables appeared in the world of commercial finance as a means of enhancing liquidity without penalizing buyers of goods and services. That being said, there still exists a degree of concern in the industry as regulatory agencies question some trade payable practices. GMAC Commercial
Finance recently launched a new generation trade payables solution — Supplier Early Payment Program which it is confident will address the concerns with traditional programs.

(Ref # LSP019)

As Diverse Elements Converge…

Supply Chain Finance Takes Factoring to a New Level

By Bill Follini, Senior Vice President, Orbian Corporation

In the following article, Bill Follini, senior vice president at Orbian Corporation, explains how his firm’s supply chain finance solution is one vivid example of how structured finance, the capital markets and technology are converging to provide companies with efficient access to liquidity and cash flow. This, in turn, injects significant liquidity into supply chains globally, driving trade and growth and allowing companies to trade on better terms.

(Ref # FAC044)

Credit Insurance —
An Investment That Guarantees Sales & Profits

By John Caffrey, Sales Vice President, Euler Hermes ACI

An investment in credit insurance achieves the goals that all businesses share: guaranteed safe sales growth and guaranteed profits. A partnership with a credit insurance carrier is a strategic step in managing the safe and profitable growth of any business enhancing the lender’s ability to lend more money safely, generating profits for the bank, while being considered a value-added partner.

(Ref # INS008)


Blazing a Trail of Excellence… Listening to the Voice of the Customer
A Profile of David Retallick, President of Textron Financial Systran Financial Services Division

When Textron Financial acquired Portland, Oregon-based Systran Financial Services Corporation in 1998, the financial services division of the multi-industry company chose David Retallick, a 25-year equipment leasing veteran, to make a name for itself as a market leader in factoring. In the true pioneer spirit of the Pacific Northwest, the move was a bold one considering the Systran acquisition was Textron Financial’s first foray into factoring and the leader it chose was given nine months to learn the ropes.

(Ref # EXEC022)

A Win-Win Strategy in Insolvency Situations:

Supply Chain Management & Accommodation Agreements

By Frank R. Mack, Consultant/Interim Manager, Conway MacKenzie & Dunleavy

In the perfect world, effective supply chain management (SCM) methodologies result in a high degree of predictability everyone in the supply chain is efficient and profitable, and the customer fulfilled. However, in the imperfect world of global economic uncertainties, certain participants find themselves at risk of business failure. When distressed participants are part of a highly interdependent and inflexible supply chain they often find themselves in a situation where creative financing strategies are required to resolve SCM issues.

(Ref # TM035)

Dealing With a “C” of Complexities: Cross-Border Capital, Collateral & Currencies

By Ferrell Coppedge, Southeast/Atlantic Division President, Bank of America Business Capital
and Janet Jarrett, Principal, Banc of America Securities

As more companies do business globally, the number of crossborder asset-based deals has increased. While most of these transactions have been between
$50 million and $300 million, Bank of America Business Capital recently provided a $675 million multi-currency senior credit facility to UK-based Ashtead Group.

(Ref # INTL023)

Second Lien Financings — Answers to the Most Frequently Asked Questions (Part I)

By Kirk A. Davenport, Marc P. Hanrahan, Peter M. Gilhuly, Partners, Latham & Watkins and Neil Cummings, Partner, Proskauer Rose

The purpose of this series is to answer some of the most frequently asked questions about second lien financings, which continue to be increasingly popular. As second lien financings offer a flexible alternative, they will, without a doubt, remain on the menu for years to come.

(Ref # LGL043)

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