The Equipment Leasing and Finance Association’s (ELFA) Monthly Leasing and Finance Index (MLFI-25), which reports economic activity for the $628 billion equipment finance sector, showed overall new business volume for January was $5.1 billion, up 21% from volume of $4.2 billion in the same period in 2011. Volume was down 53% from December, following the typical end-of-quarter, end-of-year spike in new business activity.
 
Credit quality metrics continued to improve. Receivables over 30 days decreased to 1.9% in January from 2.1% in December.  Charge-offs decreased to 0.5% from 0.7% in December.
 
Following an unusually high credit approval ratio in December, credit approvals returned to a more typical level of 77% in January. More than 71% of participating organizations reported submitting more transactions for approval during January, down from 77% in December.
 
Finally, total headcount for equipment finance companies in January decreased 3.0% from December and was down 3.0% year over year. Supplemental data show that the construction and trucking industries continued to lead the underperforming sectors.
 
Separately, the Equipment Leasing & Finance Foundation's Monthly Confidence Index (MCI-EFI) for February is 59.6, a slight increase from the January index of 59.0, indicating industry participants’ optimism is steady despite a cautious outlook about the global economic situation in the coming months.  For more detailed information on the MCI-EFI visit www.LeaseFoundation.org

ELFA President and CEO William G. Sutton, CAE, said: “January’s increase in new business volume returned to a more typical growth pattern following a very busy end-of-year for many leasing and finance companies. The continued strengthening in financing volume and trend toward healthier portfolios provide clear evidence that the equipment finance marketplace is in the midst of regaining some of the momentum lost during the Great Recession.”

Daniel McCabe, Senior Vice President, Sales and Marketing, John Deere Financial, located in Johnston, IA, said, “The Agriculture sector continues to operate at very high levels and equipment sales and financing are robust. The construction sector is recovering from a deep recession beginning with increases in the rental fleet portion of the industry. Adequate liquidity and favorable interest rates will support further expansion of the business.” 

ELFA MLFI-25 Participants

ADP Credit
BancorpSouth Equipment Finance
Bank of America
Bank of the West
BB&T Bank
BMO Harris Equipment Finance Company
Canon Financial Services
Caterpillar Financial Services
CIT
De Lage Landen Financial Services
Dell Financial Services
EverBank Commercial Finance
Fifth Third Equipment Finance Company
First American Equipment Finance
GreatAmerica
Hitachi Credit America
HP Financial Services
Huntington Equipment Finance
John Deere Financial
Key Equipment Finance
M&T Bank
Marlin Leasing
Merchants Capital
PNC Equipment Finance
RBS Asset Finance
SG Equipment Finance
Siemens Financial Services
Stearns Bank
Suntrust
Susquehanna Commercial Finance
US Bancorp Equipment Finance
Verizon Capital
Volvo Financial Services
Wells Fargo Equipment Finance

To read the full January 2012 MLFI-25 Report, click here.


About the ELFA
 
The Equipment Leasing and Finance Association (ELFA) is the trade association that represents companies in the $628 billion equipment finance sector, which includes financial services companies and manufacturers engaged in financing capital goods. ELFA members are the driving force behind the growth in the commercial equipment finance market and contribute to capital formation in the U.S. and abroad. Its over 550 members include independent and captive leasing and finance companies, banks, financial services corporations, broker/packagers and investment banks, as well as manufacturers and service providers. ELFA has been equipping business for success for more than 50 years. For more information, please visit www.elfaonline.org.