Utah Admin. Code R331-7-6 - Sales-Type Capital Lease Restrictions for Depository Institutions
(1) Within the
limitations of this rule, a depository institution, as lessor, shall be
permitted to enter into a sales-type capital lease. Although a depository
institution shall be allowed to earn a gross profit in a lease transaction in
addition to interest income from the rentals and residual, it shall be
precluded from inventorying property except for sample or display
purposes.
(2) Although many
equipment manufacturers and vendors require their dealers to inventory products
prior to sale in order for the depository institution to be allowed to receive
a wholesale price or comparable discount, the inventory of equipment prior to
leasing the equipment is not permitted.
(3) A depository institution may purchase or
acquire property in a direct lease situation only in response to a lessee's
request for that specific property and any gross profit derived from volume
discounts shall be accounted for separately from the lease.
Notes
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