FIN MEDIA HOTEL HILTON 24.09.02 JP Decrock General Director 20/11/2019

BRD = BANCA ROMANA PENTRU DEZVOLTARE SGL = SOGELEASE

* Import and leasing in Romania BRD AND BRD SGL * Import and leasing in Romania * What about the leasing ? * Who are the parties of a leasing contract and what are their interests in leasing? * What sort of constraints for the lessor? * BRD Sogelease * Credit or leasing ?

What are the most important suppliers to Romania ?

The most important suppliers (%) Sce: Nat.Statist.Comm.

Import - source: National Statistics Comm. More than 80% equipment are coming from abroad: 21.7%:machinery and mechanical 17.3% = textiles & articles thereof 13.2% = mineral products 21.5% = transports means & materials

* What about the leasing ? BRD AND BRD SGL * Import and leasing in Romania * What about the leasing ? * Who are the parties of a leasing contract and what are their interests in leasing? * What sort of constraints for the lessor? * BRD Sogelease * Credit or leasing ?

What about the leasing ? Reminder : it is an operation which permits to someone (called lessor) to lease a good to somebody else (called lessee). This equipment has been bought by the lessor to a seller (called the supplier).This operation implies the lessee’s option to choose at the end of contract between buying or not the leased good.

What sort of leasing ? * Financial lease * Operating lease

Financial lease – Main aspects Assets financed in the balance sheet of the lessee Right for the lessee for three options at the end of the leasing contract. The minimum price = 20% of the entrance price Taxes and VAT paid at the end of the contract and calculated on 20% minimum of the entrance price Lessee is not in charge for the customs administration

Assets financed in the balance sheet of the lessor Operating lease – Main aspects Assets financed in the balance sheet of the lessor Is considered as operating lease an operation which didn’t meet one of the criteria linked at the financial lease (transfer risks and benefits-ownership transfer- purchase option <50% entrance price-usage equal at 75% legal duration depreciation)

* Import and leasing in Romania * What about the leasing ? BRD AND BRD SGL * Import and leasing in Romania * What about the leasing ? * Who are the parties in a leasing contract and what are their interests in leasing ? * What sort of constraints for the lessor? * BRD Sogelease * Credit or leasing ?

* cash payment (and secured) by the leasing company The supplier * cash payment (and secured) by the leasing company * presently funding saving * no counterpart risk * only focused on industrial risk `

*fiscal : VAT paid on the contract duration and on the residual value The lessee *fiscal : VAT paid on the contract duration and on the residual value (import) *no other guarantees than the good financed as far as this equipment has a good market value *better insurances *not in charge for customs formalities

* extension of the commercial offer The lessor * extension of the commercial offer * less final risk because the lessor is the owner of the financed good

* What sort of constraints for the lessor? BRD AND BRD SGL * Import and leasing in Romania * What about the leasing ? * Who are the parties in a leasing contract and what are their interests in leasing? * What sort of constraints for the lessor? * BRD Sogelease * Credit or leasing ?

Lessor’s main constraints * Residual value risk * Regulation * Funding

Residual value risk * financial rule : RV has to be at 20% minimum of the entrance price for imported goods * confusion with the customs’ regulation. This minimum doesn’t exist in any other country

M.V and O/S Dp andRV = 20% duration = 36 M. months 20/11/2019

* statutory provisions The regulation * statutory provisions * non deductibility of interests * banks as shareholders in the leasing companies. Rule of the 20%. * no “watch dog” of the local market

* for the entities as BRD SGL affiliated to a Romanian bank The funding * for the entities as BRD SGL affiliated to a Romanian bank (lending limits) imposed by banking law = looking for more funds for pursuing the activity

* BRD Sogelease * Import and leasing in Romania BRD AND BRD SGL * Import and leasing in Romania * What about the leasing ? * Who are the parties in a leasing contract and what are their interests in leasing? * What sort of constraints for the lessor? * BRD Sogelease * Credit or leasing ?

BRD Sogelease-Brief Profile SRL recorded on the 31st july 2001 Acivity: all sorts of leasing Unique shareholder : BRD (SG = 51%) Capital = 1,5 millions $US Team of 22 people (around 25/30 in 2003)

SG network.. AA- Standards&Poor’s Aa3 Moody’s AA Fitch SG = over 13 mill. Customers Strong position in the retail banking including the leasing in Europe, thus : Purchase of Gefa (subsidiary of Deutsche Bank) 2 years ago. Setting up of SGVS (Société Générale Vendor Finance) present in Germany, France, Italy, Poland, UK,Holland,Austria, Czech Republic, Australia)

What do we finance now ?

What sort of equipment did we finance ? moving equipment : cranes,excavators,bulldozers vehicles: trucks, vans. buses, tourism and others cars, special equipment : medical and IT industrial equipment

What is our present risk per nature of equipment ? Tourism vehicles : 21% Trucks and vans : 13%, Industrial Equip.: 20% Medical Equip.: 22% Others : 24% % of the total financed

What sort of products today ? Financial Lease mainly contracts in euro

What will we finance tomorrow ? Real estate leasing

What sort of customers in BRD SGL ? * physical persons * corporate * from BRD network (90%) * outside BRD network

What could be tomorrow the main demands coming from our customers ? * fleet cars financing with full services * operating lease * lease back * vendor financing * evolutive rental contract * pure rental with services and maintenance

between supplier,lessee Future = partnership between supplier,lessee and lessor

* Credit or leasing ? * Import and leasing in Romania BRD AND BRD SGL * Import and leasing in Romania * What about the leasing ? * Who are the parties in a leasing contract and what are their interests in leasing? * What sort of constraints for the lessor? * BRD Sogelease * Credit or leasing ?

Credit Fluctuated rate Owner of the equipment More guarantees to be given to the banker To pay immediately taxes and VAT on 100% on the import price Not possible to give back the equipment after 3 years In charge for the customs duties

Leasing Fixed rate but not too much difference with the credit Not the owner of the equipment No other guarantees to be given to the banker as far as the equipment has some market value To pay at the end of the contract taxes and VAT calculated on 20% on the entry price Buying option at the end of the contract Not in charge for the customs duties