The US leasing industry saw a 36% increase
in new business last month, reaching $6.8bn (€5.2bn) in March
compared to $5bn in February.
The figure from the Equipment Leasing and
Finance Association’s (ELFA) Monthly Leasing and Finance Index
(MLFI-25) also represented a 10% rise year-on-year.
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Receivables over 30 days saw a dip of 20%
in March from the same period last year – although it increased
2.5% from February. Charge-offs decreased by almost 50%
year-on-year but increased slightly by 0.2% from February.
John McQueen, executive vice president and
head of Wells Fargo Equipment Finance, said: “In my perspective,
demand for new equipment was being driven by a combination of
factors.
“These factors include the replacement
cycle for older equipment that businesses had been using for longer
periods due to a weakening economy as well as companies focusing on
acquiring equipment to improve efficiency.”
Despite the climb in business confidence in
the US leasing industry is tentative, according to the latest
Monthly Confidence Index released by the US leasing trade body’s
research arm, the Equipment Leasing & Finance Foundation
(ELFF).
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By GlobalDataThe index for April was 62.1, a slight
increase from the March index of 61.7.
However, companies surveyed indicated some
concerns about demand for leases and loans to fund capex. Only
23.5% believed that demand will increase which is a drop from 34.2%
in March and also falls behind the 26.5% figure from February.
Respondents also showed a lack of
confidence in the US economy. The survey showed almost a 2% fall in
numbers that believed that US economic conditions will get better
over the next six months at 29.4%, and over a 1% increase in those
who evaluated the current US economy as “poor”.
One executive of a large ticket independent
leasing firm who took part in the survey, said: “[The equipment
finance industry] needs to survive another tough year, including an
election.”
