Will a few bad apples spoil the apple cart? This cliche may be an appropriate metaphor when discussing securitization and the small ticket sector of the equipment leasing industry. In the past, the industry has periodically endured the trial of some members falling into severe financial distress, often resulting in bankruptcy. Reasons for such distress have varied from the relatively mundane such as poor credit underwriting or bad financial management, to the outrageous, such as the creation of fictitious receivables seen in the 1996 Bennett Funding collapse. These untimely events have led to some form of re-evaluation by the industry's funding sources, often leaving those without funding diversity in the midst of a credit crunch. In turn, this further exasperates the problem for the struggling firms and may even spill over to create problems for stable companies. As history has a tendency to repeat itself, the last couple of years have not been without its headlines for the equipment finance industry.

Those Who Live By The Sword, Die By The Sword

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