Despite an increase in bad debts
last year and the closure of its IT broker business, BNP Paribas
Lease Group (BPLG) reported “record” volumes and is reorganising
business lines internationally.
Mike Dix, the UK head of BPLG, who is due to
step down from the company after 25 years at the end of this month,
said that there was a rise of bad debts towards the end of 2008,
with a harder environment which impacted business and increased
Despite this, Dix highlighted that 2008 was a
record year for BPLG in the UK, with £800 million (€894 million)
worth of business written compared to some £700 million in
He said that profits also increased from £22
million to £26 million.
At a global level, the French banking group’s
Equipment Solutions unit, an umbrella for BPLG and car leasing
company Arval, reported an 8.8 percent decrease in revenues and a
€14 million pre-tax loss in the third quarter.
The company said that this mainly derived from
the impact of falling used car prices, which are understood to have
heavily affected Arval.
The BNP Paribas Fleet subsidiary recently said
it intends to cut 80 jobs in the UK.
According to Dix, BPLG’s business within the
commercial vehicle sector, which is mostly overseen by the
Commercial Vehicle Finance (CVF) section of the company, suffered
less because “the majority of it is traditional HP and finance
lease operations, and therefore is not impacted by the second hand
values of units”.
He added: “Our contract hire business, which
is done by Artegy, is actually small in the UK and therefore the
impact is small.”
BPLG has seen less profitability also in
other areas, and decided to completely close its IT broker business
at the end of 2008.
Dix said that currently there are no plans to
stop any other area, adding that “the broker story was a particular
case, where the population as a whole simply didn’t generate a
sufficient profit and we couldn’t see how this in the current
environment could be profitable”.
The recent reorganisation is also expected to
support BPLG in the downturn.
Dix said that, since January, operations have
been split into two business lines in the UK.
The first, a “tech solution line”, concerns
office and IT equipment and is headed by Mike Cann.
The second is an “equipment and logistic
solution line”, which concerns farm equipment, material handling,
It is currently headed by Dix, who will be
replaced by Benoit Dilly. Dix is planning to join the Brook