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Union Leasing Ltd

May 21 - Jun 03, 2001

Union Leasing Limited (ULL) is a public listed company incorporated, in October 1993, under the laws of Pakistan. The company commenced commercial operations in May 1994. ULL's public issue was over subscribed by 50 times and it is presently listed on all the stock exchanges in Pakistan. ULL was established with the primary objective of providing full pay out leases to business, industrial and commercial sectors in Pakistan.

ULL is a subsidiary of Union Bank Limited, which at present holds over 50% of ULL's equity. This association has enabled ULL to draw upon the expertise of Union Bank Limited's senior management. In 1999 majority shareholding of Union Bank Limited was acquired by a Middle Eastern group. Union Bank Limited subsequently acquired Bank of America operations in Pakistan and became the 2nd largest private commercial bank in Pakistan. Union Leasing Limited and Union Bank Limited are jointly able to provide their customers with a broader range of financial services and products. The authorized capital of ULL is Rs. 210 million, whereas the paid up capital is Rs. 207 million. This meets the minimum capital requirement set by the Securities and Exchange Commission of Pakistan (SECP).

Prior to the takeover by current management, ULL was operating from its head office in Lahore and had a representative office in Karachi. The current management has relocated ULL's head office to Karachi, whereas the Lahore office is now a fully functional branch. This has been done to effectively capture the market and to change the company's image from a regional to a national one. Plans are also at hand to establish a branch in Islamabad. Furthermore, for true nation wide coverage, branch network of Union Bank Limited may also be utilised for generating business.

Aggressive marketing coupled with risk minimisation forms the basis of ULL's business strategy. Leasing is ULL's core business and the company constantly strives to meet customized needs of its customers. ULL concentrates on medium term financing and has provided lease finance facilities to a number of industrial as well as infrastructure related projects. In pursuance of its policy of sharing risks and rewards with other leasing companies, ULL actively strives to participate in quality syndications. Furthermore, in order to augment the growth of small-scale industry in Pakistan, ULL has been on the forefront of providing lease facilities to small businesses and consumers. The company's portfolio of small businesses consist of garment manufacturers, health care providers and computer software / hardware vendors etc.

ULL is committed to developing new products that cater to market needs. Consequent to this, ULL launched its vehicle leasing scheme - UNICAR. UNICAR offers good value for money by allowing individuals to purchase automobiles with minimal financial burden as the package is tailored to fit individual requirements.

ULL attaches paramount importance to post disbursement monitoring. Rentals for monthly / quarterly leases are monitored constantly in order to ensure compliance with the repayment schedule. Furthermore, adequate provisioning for doubtful debts is made keeping in line with statutory requirements stipulated by the State Bank of Pakistan's Prudential Regulations. Moreover, an amount equivalent to 2% of the lease portfolio is also set aside as a special reserve for future doubtful debts.

Pakistan Credit Rating Agency (PACRA) has recently upgraded ULL's long term rating thus, improving investors' confidence in ULL's Certificates of Investment. A point to be noted here is that ULL is authorized by the Securities and Exchange Commission of Pakistan to issue Certificates of Investment. With emphasis on innovation and customer service, ULL is poised to become a major player in the leasing sector.