Car lease firm wants loan guarantee

Wednesday 19 November 2008

International car lease company Leaseplan is the first company to ask for help from the Dutch finance ministry’s €200bn loan guarantee scheme, various newspapers report on Wednesday.

Leaseplan, which is owned by Volkswagen and two Middle Eastern state funds, has had a banking licence from the Dutch central bank since the beginning of the 1990s, reports the Volkskrant.

The licence allows the company, which operates in 30 countries, to borrow money to buy cars.

Last month broadcaster RTL Z reported that a number of Dutch local authorities had lent a total of €431m to Leaseplan, which was offering interest rates of up to 5.8%.

Credit rating lowered

The company now says it needs a €15bn loan guarantee because its credit rating has been lowered, making it more expensive to borrow money.

‘Like other companies, we are finding it hard to attract more liquidity,’ Leaseplan Nederland director Berno Kleinherenbrink told the Volkskrant.

The paper points out that if the finance ministry agrees to cover Leaseplan, which is a Dutch company by origin, it will be shoring up an ordinary company.

‘We will say yes or no within a couple of days,’ the finance ministry told the paper.

If the guarantee is approved and Leaseplan defaults on its loans, the state will become liable to pay them off.

The Financieele Dagblad says the Leaseplan request comes as a surprise. The company, which has 6,000 employees, must pay re-finance or pay off a loan of over €5bn by the end of 2009, the paper says.

© DutchNews.nl

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