Past the worst

According to figures compiled
by the Banking Association of Slovenia, Slovenia’s leasing market
outperformed expectations in 2008, achieving a 13 percent increase
on business written over the full year compared to 2007, when a 4.3
percent contraction in the market had been predicted by
Leaseurope.

However, predictions for 2009 are not
encouraging, based on a Q1 that showed total business down a grim
42 percent year-on-year. By year end, the Banking Association
expects leasing volumes to be down at least 25 percent on 2008’s
total, although a spokesperson commented that no further
substantial interquartile decreases are expected.

According to the World Bank’s latest economic
report, Slovenia is faring relatively well among the EU’s 10
ex-Communist economies, with only Poland and the Czech Republic set
to fare better in avoiding economic contraction. WB analyst Kaspar
Richter commented that Slovenia had an advantage over the
comparable Slovakian economy in that it relies less on the
automotive sector.

However, with cars forming more than 50
percent of Slovenia’s portfolio, compared to 31 percent for
Slovakia, the performance of motor finance will be a critical
factor in the leasing industry's health this year.

Slovenia’s leasing market is clearly dominated
by Hypo Leasing, the Slovenian leasing subsidiary of the Hypo
banking group, which conducted more than twice as much business as
its nearest rival, SocGen subsidiary SKB Bank, in 2008. The
country’s third-largest lessor is Summit, a car finance specialist
owned by Japanese giant Sumitomo.