ABF Journal, October 2008
October 2008

Economic Free Fall…
How Hard of a Landing?

The Last Inning… Will It Ever Come?

PNC Economist Discusses the Economy, Industry Into 2009
By Darryl Seland, Freelance Writer

With the barrage of negative economic indicators over recent months, ABF Journal took the opportunity to sit down with Robert Dye, senior economist of The PNC Financial Services Group to gain a bit of economic perspective. (Ref # GEN012)

Credit Markets Offer Some Comfort for ABLs
By Tod Trabocco, LBC Credit Partners

Hard times are indeed upon the lending community — but all is not lost! The fundamental driver for the business will continue to flourish over the long term, and the care that commercial lenders take in managing their assets will see through difficult times. (Ref # CRD032)

Opportunities in a Distressed Economy
By Warren H. Feder, Carl Marks Advisory Group

As fewer options become available for borrowers and lenders as credit tightens, there are still many opportunities for distressed investors. Carl Marks’ Warren Feder describes the climate and the advantages that exist in this market. (Ref # CAP14)

Shaking Loose the Capital
By Maria C. Dikeos, Reuters Loan Pricing Corporation

Just a little over a year ago, asset-based loan issuance had topped $47 billion with an additional $10 billion in the pipeline — a testament to ABLs viability in times of turbulence. Fast forward to September 2008 and capital issues have hurt demand for ABL assets — a testament to a very different phenomenon … the difference a year can make. Maria Dikeos reports on this dramatic change of climate. (Ref # IND118)

Where Are all the Bank Loans Going?
By Stephen A. Leavenworth, Industry Consultant

If bad times bode well for asset-based lenders, then why has deal flow slowed to a trickle in recent months? Stephen Leavenworth offers his thoughts
as to why this downturn is different than others and dispels the old adage, “When it rains, it pours.” (IND119)

Dealing With the Chaos… But ‘the Future Will Be Better Tomorrow’
By Howard Brod Brownstein, NachmanHaysBrownstein

Lenders and turnaround professionals alike are listening for indications that we indeed have hit bottom in this free-falling economy. Howard Brownstein reminds us in not so subtle terms, that “this too shall pass” and the time for hand wringing is over. (IND120)

More Companies Use Assets as Leverage in Battered Lending Market
By Bob McCarrick, GE Healthcare Financial Services

As the credit market slides farther downhill, asset-based lending has become an even more promising alternative to traditional lending. Here Bob McCarrick explains how the ABL market is a growing favorite in many industries, including healthcare financing. (IND121)

Staying in the Swing of Things
By Ron Kerdasha, Bank of America Business Capital

The impact of today’s volatile credit markets has been felt with differing severity based on the segment in which one plays. While lending in the
larger leverage buyouts has changed dramatically, the changes have been far less so in the middle to lower end of the market. (IND122)

Funding Strategies to Meet Today’s Liquidity Challenges
By S. Scott Gates and David D’Antonio, Diversity Capital

Every quarter we are seeing the effects of a shaken economy — whether from rapidly decreasing earnings reports or in millions of dollars in write-downs. But how is the economy affecting independent financing companies? How have they had to change their lending practices? (CRD033)

More Thoughts on Funding…
A Quick Q&A With Robert P. Rinek, Piper Jaffray & Co
(CRD034)

New on the Scene

The Tiger’s Roar… Inside Tygris Commercial Finance
By Christopher Moraff, Associate Editor

Tygris Commercial Finance made headlines this May when the company launched with a $2.1 billion capital raise, the largest ever seen in the
industry, from 90 individual investors. ABF Journal spoke with five executives from the newly formed business. (Ref # COMP029)

Profile of Success

Some Sterling Advice…
By Stuart P. Papavassiliou, Senior Editor

This month, ABF Journal sat down with Louis Cappelli, chairman of Sterling National Bank, and asked him to reflect on his illustrious career in the commercial finance industry that spans six decades. Cappelli shares his history and imparts some time-honored wisdom he’s picked up along the way. The message is simple, yet profound. (Ref # EXEC061)

Columns

A CLOSER LOOK
Lessons to be Learned From Today’s IP Marketplace
By Darin Neumyer and Karthik Vasudevan, Intellectual Property Advisors

In recent years, IP has become a hot ticket. And, as recent Chapter 11 cases have shown, this trend is on the rise. As IP’s impact on corporate success has increased, so too has its market — bringing IP-centric deals to the foreground. (Ref # APP040)

TURNAROUND CORNER
Profitable Opportunities in 2008 and 2009
By Robert D. Katz, Executive Sounding Board Associates

Most professionals in the corporate renewal world would anticipate that the remainder of 2008 and early 2009 will be exceptionally busy. Lenders see their deal flow remaining strong. With the increasing number of opportunities on the horizon, how do you separate the wheat from the chaff? (Ref # TM086)

LEGAL EYES
Challenging Economic Times Require Heightened Due Diligence
to Avoid the Risk of Loss

By Joshua Horn, Fox Rothschild

Recent experiences have made it crystal clear that financial institutions must be more attentive to customer selection and management in order to avoid future problems. Simple techniques can help avoid problematic client conduct.
(Ref # LGL088)