|
|
|
| Lease
Finance |
|
Lease financing is one of the most convenient long term sources of acquiring
capital machinery and equipment. It is a very popular scheme whereby a client is given the
opportunity to have an exclusive right to use an asset, usually for an agreed period of
time, against payment of rent. Of late, the lease finance has become very popular in
almost all the countries of the world. An obvious advantage of the lease is to use an
asset without having to buy it. The lessee is obligated to make lease payments until the
expiration of the lease agreement, which corresponds to the useful life of the
asset.
In a capital scarce economy like ours, Lease Financing is suitable for firms to acquire
Capital Machinery, Equipments, Medical Instruments, Automobiles etc. And thereby employ
their own resources more advantageously in some other investments. Lease financing also
helps a firm to reap significant economic benefit through tax saving and by reducing the
risk of the equipments becoming obsolete due to the technological advancement. |
|
Objective : |
Prime Bank Ltd. has introduced the lease finance with the following
objectives: |
| 01. |
To assist the genuine and capable
entrepreneurs for acquiring Capital Machinery and Equipments to undertake enterprises
without equity.
|
| 02. |
To encourage the new and educated young
entrepreneurs to undertake productive venture and demonstrate their creativity and thereby
participate in the national development.
|
| 03. |
To participate in the industrial development
of the country.
|
|
| Lease Items / Equipments : |
| Prime
Bank Limited offers lease finance for acquiring the use of capital machinery, equipments,
medical instruments, etc. The customers are entitled to decide the specification, price
and model of the lease item/equipment. Bank will purchase the item (s) in accordance with
the specifications given by the clients. However, the suppliers of the items must ensure
after sales services and warranties. The price should be competitive and acceptable to the
Bank. |
|
| Eligibility for Availing Lease finance : |
| All
genuine entrepreneurs having adequate experience and expertise are eligible to apply for
Lease Finance under the scheme. The amount of Lease Finance will not generally exceed Tk.
1.00 crore, but in exceptionally good cases, the limit can reasonably be exceeded on
condition that the Bank will depute an officer for close and intensive supervision of the
project. In other cases of Lease Finance for amount below Tk. 1.00 crore, an officer of
the Bank will supervise a number of projects at a time according to convenience. |
|
| Documents & Security : |
| The
entrepreneur will be required to provide the following securities: |
| 01. |
The lease items will
remain in the name of the Bank i.e., Bank will be the sole owner of the leased items. |
| 02. |
Collateral
securities having liquidation value covering at least 100% of the amount of finance. |
| 03. |
Deposit of listed
Shares, National Savings Certificates, ICB Unit Certificates, Assignment of Life Insurance
Policies, Bank Guarantee, Insurance Guarantee etc. will also be acceptable as collateral
securities. |
| 04. |
In case of existing industrial units requiring
BMRE, charge may be created on the existing Fixed Assets as collateral securities
for the finance. In case of existing Automobile enterprises, creation of charge on the
existing vehicles will also be acceptable as collateral securities.
|
| 05. |
i) In case of default in payment of lease
rental for consecutive 2 (two) months, the Bank will take over the lease items without
giving any prior notice. ii) In case of taking over the lease items by the Bank before
maturity, the lessee will be liable for the loss, if any, caused to the Bank of such
premature taking over. iii) the Bank will exercise close and intensive supervision of such
projects. An Officer of the Bank will be engaged separately for supervision of such
projects to ensure proper utilization of the lease items and timely repayment of the
monthly rentals.
|
|
more..» |
|
|
|
