The Latin American equipment leasing and finance industry has
declined by 6% after a period of impressive expansion, according to
a report by The Alta Group.
Although some countries and companies saw growth, the region’s
overall leasing portfolio declined by 6% last year, as measured in
$US. Brazil’s leasing industry, which holds 63% of the region’s
portfolio, decreased by 9%, as did the portfolios of Guatemala,
Venezuela and Puerto Rico.
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Large bank-affiliated leasing companies drove the downturn,
whilst well known captive leasing companies and vendor-oriented
leasing companies realized notable success, according to The Alta
Group Latin American Region (LAR). Columbia, Peru and Argentina
were amongst the Latin American countries to achieve growth.
Leasing leaders will discuss details of the report on 17-18
November at a conference in Miami.
“In light of the fact that the economy grew 5% in Latin America,
we were surprised that the overall leasing portfolio did not grow,”
said Rafael Castillo-Triana, chief executive of LAR. “The Latin
American leasing industry is having growing pains. It is maturing,
and business models are making a substantial transformation from
pure finance and credit leases, to business models centring more on
operating leases. This changes the way companies allocate their
capital, go to market, and originate business.”
“Other factors that had an impact on the industry included the
2008 financial crisis, the relative depreciation of the U.S.
dollar, and, in certain Latin American countries, tax reform and
political leadership,” said Triana.
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