Overview

Equipment financing is a secured lending product where the equipment itself typically serves as collateral for the loan or lease. First Citizens BancShares structures financing to accommodate a broad range of equipment types, from heavy construction and agricultural machinery to medical devices, manufacturing systems, professional kitchen appliances, and information technology infrastructure. These programs are meant to preserve working capital, optimize tax benefits, and align payments with the asset’s productive life.

Key Benefits

• Preserve Working Capital: Finance equipment purchases while maintaining liquidity to fund other operating needs and growth initiatives.
• Flexible Terms: Customizable loan and lease terms to match cash flow patterns and projected return on investment.
• Tax Advantages: Potential tax benefits such as accelerated depreciation or tax-deductible lease payments, depending on jurisdiction and accounting treatment.
• Upgrade and Replace: Structured solutions that make it easier to upgrade to the latest technology or replace inefficient assets without large upfront expenditures.
• Preserve Credit Lines: Equipment financing can be structured outside of a business’s working capital facility, leaving existing lines available for other needs.
• Speed and Predictability: Predictable monthly payments and efficient approval processes help businesses plan capital budgets with confidence.

Types of Financing Offered

First Citizens BancShares provides several financing options to suit different business needs and ownership preferences:

• Equipment Loans: Traditional loans that provide ownership at the end of the term. Payments and terms are structured to reflect the equipment’s useful life.
• Capital Leases: Lease arrangements that may include an option to purchase the equipment at the end of the lease term, offering many of the benefits of ownership while conserving cash.
• Operating Leases: Shorter-term leases that allow businesses to use equipment without assuming residual value risk, which is useful for rapidly evolving technology.
• Sale-Leaseback: For companies that already own equipment, this option converts owned assets into immediate capital by selling the equipment and leasing it back.
• Vendor Financing: Collaborative programs with equipment manufacturers and distributors to simplify the procurement process and integrate financing into the purchase transaction.

Eligibility and Qualifying Criteria

Eligibility depends on several factors, including the business’s credit profile, financial statements, cash flow, industry, and the type and age of the equipment. First Citizens BancShares considers both established companies and growing businesses. Typical criteria include:

• Demonstrated ability to service debt from operating cash flow.
• Detailed information on the equipment to be financed, including cost, specifications, and expected useful life.
• Business financial statements, tax returns, and references as part of the underwriting process.
• Collateral value and residual considerations for used equipment or specialty assets.

Financing can often be structured for new equipment with favorable terms, while used or specialty equipment may require additional underwriting considerations.

Application and Approval Process

1. Initial Consultation: Discuss business needs, equipment specifications, and financing objectives with a lending specialist.
2. Proposal and Structure: Receive customized proposals that outline term options, payment schedules, and tax/accounting implications.
3. Documentation: Submit required documentation, which generally includes financial statements, equipment quotes, and corporate information.
4. Underwriting: Underwriters assess creditworthiness, collateral value, and repayment capacity to finalize terms.
5. Funding and Delivery: Upon approval and documentation completion, funds are disbursed or lease commenced to enable equipment acquisition.
6. Servicing and End-of-Term Options: Choose from options such as ownership, renewal, return, or replacement at lease maturity, depending on the financing structure chosen.

Documentation Typically Required

While specific requirements vary by transaction, common documentation includes:

• Equipment invoices or manufacturer quotes
• Business and personal financial statements
• Recent tax returns
• Proof of business registration and ownership
• Accounts receivable and payable schedules when relevant
• Insurance certificates naming the lender as loss payee where applicable

Industry Experience and Support

First Citizens BancShares combines industry knowledge with lending expertise to support customers across sectors such as construction, healthcare, manufacturing, agriculture, transportation, and technology. Relationship managers work with clients to align financing with operational goals and provide guidance on structuring deals for optimal financial impact.

Why Choose This Program

The equipment financing program at First Citizens BancShares is crafted to deliver practical, business-focused lending with flexible structures, personalized service, and a commitment to long-term client relationships. Key differentiators include a consultative approach to deal structure, an understanding of industry-specific equipment cycles, and an emphasis on aligning financing with cash flow and tax planning objectives.

Common Questions

Can I finance both new and used equipment?

Yes. Financing is available for new and used equipment, though terms and underwriting considerations may vary based on age, condition, and residual value of the asset.

How are payments structured?

Payments can be structured monthly, quarterly, or in other intervals to match cash flow needs. Seasonal payment schedules are also available for industries with cyclical revenue patterns.

What happens at the end of a lease?

End-of-lease options depend on the lease type and can include purchasing the equipment, renewing the lease, returning the equipment, or upgrading to new equipment under a new agreement.