5 Minutes with the Financial Institutions Chair

What’s happening with financial institutions in the equipment finance space? Equipment Leasing & Finance magazine recently caught up with David Farrell, Chair of the Financial Institutions Business Council Steering Committee (BCSC), to take the pulse of this sector. Farrell, who is Managing Director - Head of Capital Markets at Bank of America Global Leasing, is currently serving his first year as Chair of the committee, which represents ELFA member bank-related organizations and other financial institutions involved in single transactions over $5 million.

What issues is the Financial Institutions BCSC focused on this year?

The Council is focused on key issues such as how companies are planning for the cessation of LIBOR slated for the end of 2021, lease accounting challenges such as failed sale-leasebacks and CECL (ASC326), the inevitable migration to electronic contracting and issues around state banking licenses. The cessation of LIBOR will have far-reaching repercussions on the pricing of equipment financing transactions. In fact, some in the industry equate its impact to Y2K in terms of scale and preparation, since member companies will need to modify their pricing methodologies and operations. Bloomberg estimates more than $370 trillion of debt and related products is tied to LIBOR. The Council also intends to share best practices around diversity, equity and inclusion, an important priority for ELFA and many member companies. Lastly, the group will continue to participate in the Foundation’s Guest Lecture Program to help develop future financing professionals. Our goal is to deliver at least nine guest lectures at universities and colleges across the country.

What do you like best about serving on a BCSC?

I am a perennial committee member, having served three times in the past, and am thankful for the opportunity to be the Chair for this year’s iteration. I enjoy the camaraderie and interactions with the other members on the Council. With 19 participants, we are one of the largest business councils and have a wide variety of talented people representing a cross section of the industry. The volunteers are not only interesting and bright people to learn from, they are highly engaged in expanding the reach and value of ELFA to our industry.

What’s the last book you read?

Younger Next Year by Dr. Henry Lodge and Chris Crowley. This is an entertaining book about the value of exercise, diet and social connections to achieve vitality in the back half of one’s life.