FAQs

1. What is First Leasing Bank?
2. Where are you located?
3. What equipments can I finance?
4. What is the transaction size?
5. What documentation is required?
6. What is your rate?
7. Why lease from First Leasing Bank instead of a traditional bank loan?
8. Do you finance used equipments?
9. What countries do you lease in?
10. What are the differences between operating and finance lease?
11. What is the difference between istisna and ijara?
12.When are payments due?
13.Is it possible to upgrade or add-on to my original lease?
14.Can this lease be canceled?
15.Who can lease?
16.What factors are used to determine credit worthiness? Will my lease be approved?
17.How much money do I have to pay up front?


1. What is First Leasing Bank?
First Leasing Bank is a Bahrain-based Wholesale Bank, incorporated under a license granted by the Central Bank of Bahrain. First Leasing Bank (FLB) is the first bank in the GCC dedicated to the introduction and expansion of equipment leasing. The Bank enters into transactions in Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.

First Leasing Bank is an affiliate of Ithmaar Bank who holds the largest single block of shares in the Bank. The remaining thirty three shareholders are comprised of leading individuals, companies, and capital management firms. The shareholders and management team offer a unique combination of experiences, background, and financial acumen. First Leasing Bank presents the Gulf with an unequalled combination of local knowledge and international experience in equipment lease-financing. More than just a leasing company; First Leasing Bank is a provider of high-quality asset-based financing. The Bank structures a range of products and services for lessees, investors and vendor partners.
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2. Where are you located?
First Leasing Bank is located on the 12th floor of the Addax Tower in the Seef District. Branch offices will soon be opened in other locations in the GCC.
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3. What equipments can I finance?
FLB will offer lease financing in form of both finance and operating leases for most of asset classes including: telecommunication, information technology, industrial, construction, health care, printing/press & media, office equipments, maritime, transportation, special purpose real estate, plus many other qualified equipments.
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4. What is the transaction size?
First Leasing Bank specializes in transactions from $500,000 to $10,000,000.
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5. What documentation is required?
The basic required documents are:
• 3 years audited financial statements by a reputable audit firm
• Copy of registration, Memorandum and Articles of Association
• A minimum of two bank and trade references
• Equipment descriptions and purchase price
• Bank statements

Plus any other information you believe will be useful to FLB.
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6. What is your rate?
The rate depends on a number of factors. First and foremost is whether you choose a finance lease or an operating lease. The type of equipment, manufacturer, economic life of the equipment, and lease tenor are also key factors. Lastly, we consider the financial strength, longevity, and market reputation of your business.
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7. Why lease from First Leasing Bank instead of a traditional bank loan?
When comparing a lease with loan, it is important to understand key terminology and points. Equipment leasing is probably the best overall choice for you.

Rate Structure: Commercial banks prefer to loan long-term money on a floating or variable rate tied to LIBOR or some other indices. This places the rate risk on you instead of the bank. Lease rates are usually fixed—especially for shorter terms.

Down Payment: Commercial banks typically require up to 30% down on any equipment financing. First Leasing Bank strives for 100% financing and uses security deposits sparingly.

Revolving Loan: “Revolvers” gives a bank the ability to extend or cancel the loan on a yearly basis. Leasing is fixed long term financing.

Fees and Enhancers: A commercial bank measures a customer’s value by the total fees and profitability driven from the account. The commercial bank typically will require your deposit accounts, sweep accounts, investments, foreign exchange, and so on. First Leasing Bank only does equipment leasing and that is how we measure value. Your total cost is fully disclosed in advance.

Credit Review Process: The commercial bank credit review process is long and tedious and generally requests further information. FLB usually takes lesser time for an approval because we are only focused on leasing.

Understanding: Banks are more concerned about their exposure and risk. At First Leasing Bank we are just as concerned with the quality and useful life of the asset, your business, and your practical needs.

Equipment Obsolescence: An operating lease provides end of term (EOT) options to return, purchase, or extend the lease. Add-on and upgrade provisions can also be structured.

Flexibility: Banks are strict on loan schedule. Leasing offers a variety of products that allow you to tailor a program to better fit your cash flow, budget, transaction structure and cyclical fluctuations needs.
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8. Do you finance used equipments?
Yes, depending on the type, condition, and manufacturer of the equipment, First Leasing Bank will typically finance used equipment up to 2 years old. First Leasing Bank will also apply the same standards and enter into a sale-leaseback with you whereby we buy the equipment from you and immediately lease it back to you.
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9. What countries do you lease in?
Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and UAE.
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10. What are the differences between operating and finance lease?
The greatest difference between finance leases and operating leases is the impact each has on the balance sheet. A finance lease is treated like an installment sale whereby the lessee recognizes the asset and fully depreciates it in the balance sheet. Operating leases are treated as long-term rentals where the lessee only pays for the time using the equipments. Typically the lessee will return the equipment at the end of term and thereby expense the payments without impacting the balance sheet (“off balance sheet financing”). In Islamic terminology, an operating lease is called ijara and finance lease is called ijara wa iqtina.
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11. What is the difference between istisna and ijara?
Istisna is used for construction or manufacturing in progress transactions as well as trade finance. Typically, the bank pays the manufacturer and receives back the original amount plus a profit from the end user. Istisna is often structured with a forward ijara/lease, thus allowing the end-user to finance the equipment in both the manufacturing/construction phase as well as when the asset is actively employed.
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12. When are payments due?
Your due date is the last day of the month or last day of the quarter.
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13. Is it possible to upgrade or add-on to my original lease?
Yes with an acceptable payment history. FLB provides cost effective upgrade and add on alternatives.
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14. Can this lease be canceled?
No, but you may trade-up this equipment and lease new equipment prior to the end of the lease or you may payoff the lease early.
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15. Who can lease?
Any business, organization, association, or governmental entity may lease equipment. FLB does not originate leases to individuals for personal use.
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16. What factors are used to determine credit worthiness? Will my lease be approved?
The following factors are used to determine credit worthiness:
• Length of time in business
• Type of business
• Financial condition
• Credit evaluation or reports
• Bank and/or trade references
• Payment record with FLB
• Type & brand of asset
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17. How much money do I have to pay up front?
Leases can be structured with no advance payment, down payment or advance payments. Security deposits can be applied toward the purchase of the equipment at lease end or returned to you either when little is passed to you or with return of the equipment to FLB.
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