|»Products and Services|
1. Financial Leases
Financial Lease is a credit facility where LBP Lease (lessor) acquires fixed assets based on the requirements/needs of the client (lessee) which are then leased by the client (Lessee) from LBP Lease (Lessor) through payment of periodic lease amortization. The benefits and risks of ownership of the assets are transferred to the lease.This facility allows enterprises to acquire equipment, motor vehicle, lot and building and other equipment, to expand, upgrade or modernize their operations. It also enables enterprises to match financing terms with the earning potential of the capital asset, preserve working capital and credit lines and address existing or current budget limitation.
2. Operating Leases
Operating Lease is a credit facility where the client (lessee) makes rental payments to LBP Lease (lessor) for the use of an asset over a fixed period (normally, more than a year). Under the facility, LBP Lease retains the benefits and risk of ownership of the leased asset. At the end of the lease term, the lessee may opt to renew the lease, purchase the asset at its fair market value or return the asset to LBP Lease. Operating lease facility is for clients who do not want to be burdened with acquisition and disposition processes and will rather not have the risks and benefits of ownership on the asset to be acquired. It can only be granted for selected asset types that have relatively long economic life and well established secondary markets.