Recently Funded Studies

This year, the Equipment Leasing and Finance Foundation has granted research money for the following projects. For more information on these projects, contact Lisa Levine.

Bundled Transactions - Is the trend a game-changer for the equipment finance industry?
Expected Delivery Date: September 2009
Researcher: Accenture, Inc.
The Foundation recently funded a study to examine if the bundled transaction framework will have a game-changing impact on the equipment financing industry? The project will focus on IT spending, including associated software and services; telecommunications; and office equipment.
New products sold in the equipment finance market have grown increasingly complex over time, blurring the distinctions between loan and lease products. Based on market demand, new approaches to bundling are being provided as well. This study will examine in detail and provide a point of view on a critical question facing the industry today: Will Bundled Transaction Frameworks persist as a procurement option on the "IT acquisition spectrum" due to customer and vendor requirements? This unique research will address whether equipment finance customers will continue to choose these financial structures and will leading vendors continue to offer them. It will also provide valuable context as to whether this trend has game-changing impact on the equipment financing industry in particular. The study will help leadership understand these innovative approaches in making their long-term strategic decisions.
Captive Finance Firms in a Challenging Economy: Why Some Thrive while Others Falter
Expected Delivery Date: October 2009
Researcher: Capgemini
This study will investigate why challenging economic conditions have shown there is a great degree of disparity in the success of captive financing organizations. The study will look at both why and what actions a captive finance firm can take to ensure their viability and value to their parent. Recent economic challenges have resulted in unprecedented changes in the environment captive operate. Business models once proven to be effective have failed or are being questions and modified. The changing market landscape is resulting in uncertainty regarding the viability of some captives. The study will isolate the strategic and operational capabilities which make some captive successful while others are less so. The final report will include an analysis of the findings and projections for what the future holds.
How Good Is Your Credit Scoring Model?
Expected Delivery Date: September 2009
Researcher: Predictive Metrics
This study will identify the specific risks associated with the application of credit scoring models to credit decisioning. The study will include an overview of existing practices in the equipment leasing industry as well as practices that vary significantly from the norm. The study will examine how the recent lending institution failures outside the equipment leasing industry underscore the risk of over-reliance on automated scoring models in place of human judgment in the leasing industry. It will look at the risks and implications of using a model for an application is was not designed for. What is the impact of the current economic downturn on the predictive capacity of scoring models? Specifically, do factors such as the mortgage industry crisis or fuel prices affect scorecard results? Are there specific trends, practices and industry controls that exist which will affect the nature of potential exposures that exist within the equipment leasing and finance industry? What are specific recommendations for remedial action in areas where such problems exist? With respect to the future of credit models are there other factors, not usually included as model variables that should be considered for inclusion in future models? What are the prevalent technologies utilized in developing credit models? And is any one technology superior and if so how? And much more.
Lending Behavior of Captives and Banks
Expected Delivery Date: Spring 2010
Researcher: Claudine Madras Gartenberg, Harvard Business School
This study examines the difference in lending behavior between captive and banks during the course of a business cycle, with the objective of providing evidence on the role of captives as important financial institutes in the economy. The study with further the discussion on whether firms which combine commercial and financial activities expand credit markets both by engaging in "relationship-lending" to small- and medium-sized businesses and by showing forbearance with distressed customers during trough periods, or whether these firms distort markets by excessively cross-subsidizing the parent business.
Rebuilding Healthcare Infrastructure – What's in it for Us?
Expected Delivery Date: October 2009
Researcher: Cindy Eddins Collier, Healthcare Valuation Solutions
Implications for the equipment finance industry of the upcoming government investment in healthcare technology infrastructure will be explored. The study will look at and document the scope of opportunity for equipment financiers, will address the credit quality issues (primary users, reimbursements, etc) and will define the role of financing in the healthcare sector.
The market opportunity will be explored through research, analysis and extensive interviews with healthcare providers, payers, attorneys, manufactures, legislators and industry leaders. Extensive healthcare, finance and leasing industry references and resources will be provided for the users of the study. Specific opportunities and risk for equipment finance companies will be explored and described.
State of the Equipment Finance Industry report (SEFI)
Expected Delivery Date: October 2009
Researcher: HIS Global Insight
The State of the Equipment Finance Industry (SEFI) report is a valuable guide for equipment finance companies, funding sources, rating and industry analysts, academicians, research and media sources, providing them with perspectives and insights into the opportunities and challenges facing the equipment finance industry. Based on the ELFA Survey of Equipment Finance Industry Activity, interviews with industry leaders and an economic review, the SEFI offers insiders' insights into how equipment lessors should prepare themselves for the economic recovery as well as probable and significant legislative and regulatory activities.