Leasing

Leasing is intended to make manufacturing and other equipment (such as vehicles) more affordable for our Clients.

SDM-Bank’s Leasing Finance solutions enable our Clients to operate and integrate machinery and equipment without outright ownership of the asset.

SDM-Bank’s Leasing Company will effectively purchase the equipment/vehicles and will own the asset. The Leasing Company then leases the purchased Asset to our Clients.

The basic idea is simple - businesses that have positive Net Preset Value projects and canott afford to purchase the required equipment and/or property, just lease the equipment from SDM-Bank’s Leasing Company.

Leasing with SDM-Bank is straight forward and simple.

The first step is to agree upon the Terms and Conditions between SDM-Bank’s Leasing Company and our Client.

The Client is called a Lessee and SDM-Bank’s Leasing Company is called a Lessor.

As part of the agreement, SDM-Bank’s Leasing Company will purchase the required equipment and will become the owner of the purchased equipment.

The Client (the Lessee) agrees to reimburse SDM-Bank’s Leasing Company via regularly scheduled payments (equal to equipment costs plus interest and associated expenses).

Our Clients are able to lease any non-consumable property, including Business Real Estate and other property, equipment, vehicles and other movable and immovable business property that is integral in day-to-day operational business needs.

BELOW WE OUTLINE A SAMPLE LEASING FINANCE DEAL DESCRIPTION

• The Client (the Lessee) identifies Property & Equipment that the Client desires to Lease.

• The Client (the Lessee) approaches SDM-Bank with the proposal to lease the identified Property & Equipment.

• SDM-Bank’s Leasing Company (the Lessor) signs a leasing agreement with the Client with pre-defined Terms & Conditions of the Lease that will include such items as terms, amounts, insurance, and other relevant conditions.

• The Lessor purchases the agreed-upon Property & Equipment.

• The equipment is transferred to the Lessee for the Lessee’s use and exploitation.

• The Lessee, upon receipt of the leased Property & Equipment, commences regularly schedule Lease payments to the Lessor.
  

LEASE FINANCE ADVANTAGES:

• The Client does not fund the deal upfront. The Lessor funds the purchase.

• Accelerates and facilitates equipment upgrade without the need to sell outdated equipment.

• Accelerates amortization on leased Property & Equipment.

• Reduces tax liability by classifying lease payments as the Cost of Goods, and/or services.

• Lowers tax and accounting complexity for the Client.

• Preserves and potentially improves a healthy balance sheet.

• Lease payments are made according to a predefined schedule and in the amount known beforehand.

• Reduces reliance on Accounts Payable supplier and Bank financing.

• Sustains profitable growth, reducing potential bottlenecks due to inability to own required productive assets.