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From ABS-Bond to volume of leased assets – in our GRENKE glossary you can find the explanation of different terms.



Abbreviation for "Asset-backed commercial paper programme". Under ABCP programme, companies such as leasing companies sell their receivables to a special-purpose entity which issues interest-bearing securi-ties to investors through the capital market. Interest and the principal payments on these securities are made using the cash flows from the assigned receivables on these securities.


Type of refinancing with which several tranches of bonds with different ratings (risk classes) are issued by the SPE. The share of the best-rated tranche is a reflection of the quality of a company’s leasing portfolio and risk management and directly impacts the cost of this type of financing.


GRENKE sells used leased assets in Germany, France, Austria, Switzerland and Italy via its internet portal Asset-Broker. Our resellers can also use the portal to sell their own demonstration equipment or used goods.

Average number of employees

This is the average number of employees of GRENKE in the reporting period. This figure does not include directors; part-time employees are included on a pro rata basis.



German Leasing Association "Bundesverband Deutscher Leasingunternehmen e.V." BDL, Berlin


German Association for the Information Industry "Bundesverband Informationswirtschaft, Telekommunikation und neue Medien e.V.", Berlin,


Contribution margin

The contribution margin, also known as gross profit, is a term used in operational cost accounting. The contribution margin is the contribution made, for example, by a product to cover fixed costs and generate a net profit. It is calculated as the difference between revenues and variable costs incurred directly by the product.

At GRENKE, contribution margin 1 is calculated as the present value of the interest margin net of commissions to third parties. Contribution margin 2 is made up of the present value of operating income of a lease contract less risk and individual contract costs.

Cost/income ratio

Comparing expenses with income produces the cost/income ratio. Contrary to approaches typically used in the banking sector, we deduct the cost of loss settlement/risk provisioning from income, even though this results in a less favourable ratio. Increased sales revenue in the leasing market would be possible if greater risks were taken. However, such a cosmetic improvement of the cost/income ratio cannot be the motivation for our business activities, and consequently we do not report in this way.


We determine the cost/income ratio as the ratio of the total of all expenses (less settlement of claims and taxes) to income, comprising net interest income from leasing business after loss settlement, net income from insurance business, net income from new business, additional income from realisation of assets, other oper-ating income and net interest income (other than from leasing business).


Debt issuance program

The debt issuance program is a flexible refinancing programme with standardised documentation. It enables issuers to cover their financing needs by borrowing in various currencies and volumes and with varying terms. Within the scope of this programme (long-term issue), bonds can be issued on the stock exchange or off the floor. The interest rate is fixed or variable. Depending on the volume, the bonds are placed by one or more dealer banks. The participating banks do not usually assume any underwriting risk. The issuer bears the placement risk.



Earnings before interest and taxes


Earnings before taxes.

Economic Result

An indicator that combines the total comprehensive income of one period with the change in the embedded value (excluding equity) after tax (the present value of all outstanding lease instalments after costs and risk provisions).

Embedded Value

The income generated from a leasing contract is distributed over the term of the contract under IAS/IFRS accounting. The majority of the profit from the contract portfolio on balance sheet date is therefore generated in the future. Based on similar approaches taken in the insurance industry, we calculate the approximate value of future net cash flows from the current contract portfolio on the balance sheet date as embedded value, deduct the estimated expenses and add the equity.



Factoring is a financial service for the purpose of short-term sales financing. The factor buys the factoring customer‘s receivables due from its debtor and collects them directly from the debtor. In return for relinquishing the receivables, the factor immediately pays the factoring customer a sum based on the value of the receivable.eine Zahlung, die sich an der Höhe der Forderung orientiert.

Franchise system of GRENKE

GRENKE is using a franchise system since 2003 with the goal to introduce the business model and the GRENKE brand to a country and make them known as quickly as possible.


The franchisees receive access to expertise, proven management tools, and back office support from GRENKE and are entitled to use the "GRENKE" and "GRENKELEASING" brand names. GRENKE also assume responsibility for the audit and refinancing of lease contracts. This is how GRENKE ensures that they are always informed of the exact quality of the receivables portfolio and that the GRENKE name becomes established on the market.


GRENKE does not hold a stake in these legally independent franchise entities, but after a specific period of usually four to six years, it has the option to buy the company on pre-defined terms.


Hybrid Bond

Hybrid bonds are subordinated bonds and represent a hybrid form of equity and debt. Hybrid bonds have both, the characteristics of equities and bonds. For the company issuing the hybrid bonds, they have equity-like features. The term of the hybrid bonds is often indefinite and usually the bonds bear a relatively high interest coupon. Hybrid capital also includes the AT-1 bond issued by GRENKE.



The International Financial Reporting Standards (IFRS) are external reporting regulations developed by the International Accounting Standards Board (IASB), an independent private body. The IFRS, formerly known as the International Accounting Standards (IASs), comprise the standards themselves and the interpretations by the International Financial Reporting Interpretations Committee (IFRIC), formerly known as the Standing Interpretations Committee (SIC). As of fiscal year 2005, the application of these standards is compulsory for publicly traded companies with their registered office in the European Union (EU) in the form endorsed by the EU.

IT Asset Management

Customers who conclude a DISPO framework agreement (see above) are also offered active support for their IT infrastructure (inventory and cost management) in the form of our IT-Asset-Management tool ("ITAM"). This web based software facilitates the management of the customer‘ s entire asset portfolio using a standard platform.


IT and telecommunications market.

Ifo Institute

"Institut für Wirtschaftsforschung e.V." The ifo institute is one of the largest economic research institutions in Germany which regularly publishes economic research results (


Master lease agreement (MLA)

Customers who invest regularly in new equipment conclude a master lease agreement with GRENKE and benefit from standardised, attractive terms within that framework. The agreed leasing volumes can be drawn in individual tranches by customers. Hence, customers benefit from favourable terms, lower costs and greater flexibility. The customer‘s reseller is informed of the framework agreement, giving him additional options for increasing business with this customer.

Mean acquisition value

The mean acquisition value is determined as the arithmetic mean of the acquisition costs of all leased as-sets for which lease agreements were concluded in the reporting period.


New Business

New business comprises the acquisition costs of all newly acquired assets from leasing and lease-purchase contracts and the factoring volume in the reporting period.


Prime Standard

The Prime Standard is a listing standard of the Frankfurt Stock Exchange with transparency requirements for issuers which exceed those of the General Standard (e. g. quarterly reports have to be published and all corporate communication must also be available in English). A listing in the Prime Standard is a requirement for a listing on one of Deutsche Börse‘s selective indices such as the DAX, MDAX, TecDAX, or SDAX. GRENKE AG is listed in the SDAX.



Rating agencies rate the creditworthiness of an issuer over long and short-term periods using a standard rating method. "AAA", for example, is the highest solvency rating, and "C" or "D" indicates a low probability of payment. The leading rating agencies are Moody‘s and Standard & Poor‘s.


Abbreviation for "return on equity". The return on equity is calculated as a ratio of the net profit to the equity disclosed in the balance sheet. The ratio gives an indication as to the return on shareholder capital.



The SDAX index contains the 50 largest and most liquid companies from classic sectors ranking just below the MDAX, which comprises 50 stocks, and the DAX, which comprises 30 stocks. These may include Ger-man and foreign companies, as long as they are listed in the Prime Standard. On January 1, 2003, GRENKE was admitted to the Prime Standard and listed on the SDAX as of February 11, 2003. This new regulation became effective as of March 24, 2003.

Scoring system

A scoring system is used at leasing companies to determine the creditworthiness of a potential lessee. Using a statistical calculation, the probability of default is determined for a new lease agreement, which forms the basis for a decision as to whether or not to accept the application for a lease.


Since 1994, GRENKE has assessed the creditworthiness of its lessees using a scoring system, based on external sources of information, e.g. the credit rating agency Creditreform, and supplemented by its own database. Each potential lessee receives a score which ultimately sways the decision as to whether or not a lease agreement is concluded.

Share of IT products in lease portfolio

We define IT products as equipment used in information technology (such as PCs, servers, printers), photocopying technology and communication technology. The figure relates to the number of newly concluded lease contracts during the reporting period.

Share of corporate customers in lease portfolio

We define corporate customers as lessees who are not subject to specific protection rules for consumers. The figure relates to the number of newly concluded lease contracts during the reporting period.

Small Caps

Small companies which do not belong to the highly traded companies of the main indices.

Small-Ticket IT Leasing

Leasing in this market segment, equipment such as notebooks, personal computers, monitors and other peripheral devices, smaller networks, software and telecommunications, backup and copier technology normally costing up to EUR 25,000 are leased


Volume of leased assets

The volume of leased assets is the total of all (historical) acquisition costs of assets from ongoing leasing and lease purchase agreements.