The leasing arms of the top French banks are riding the crest of
the credit crunch with first quarter 2008 results showing mostly
growth year-on-year.
New production volumes at Credit Agricole Leasing’s French
outlets have grown 18 per cent during the year to date, partly
because of rising demand for real estate financing.
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SG Equipment Finance, which is present in 23 countries,
increased new lending by 11.3 per cent, to €2.2bn, for year-on-year
Q1 2008 and its outstandings by March 31 2008 reached €17.6bn.
Pre-tax profits, however, at the equipment solutions arm of BNP
Paribas Group dropped 11 per cent year-on-year during the first
quarter of this year, despite marginal growth in its vehicle
financing arm.
BNP attributed the drop in pre-tax income, down to €89m, to a
€5m increase in operating expenses in the first quarter of 2008,
and an extra €3m expense in the cost of risk during the same
period.
However, the parent bank reported in its first quarter statement
that its equipment solutions business had “shown a good sales and
marketing drive [in the past three months], in particular in
equipment leasing and in vehicle financing”.
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By GlobalDataIt saw a 7.3 per cent rise year-on- year in the number of
vehicles it financed, while revenues totalled €284m, which it
described as “stable”.
Credit Agricole Leasing’s French real estate arm is ranked
number one in France in leasing production volumes, which grew 19
per cent year-on-year during 2007, to reach €928m.
While its real estate arm appears to be thriving, particularly
considering the fact Credit Agricole Leasing was only launched
three years ago, some of its main competitors are seeing a marginal
decline in this sector. Production volumes at Société Générale,
which is ranked second in France, dropped 8 per cent last year,
down to €787m.
Some 23 per cent of Credit Agricole Leasing’s total business is
sourced from real estate leasing, compared to 59 per cent from
equipment leasing and 13 per cent from sustainable development and
public sector leasing. Structured long-term deals represent 1 per
cent of its overall business.
The French company, which has 32 branches in France, plans to
increase net earnings by €6.5m, to reach €50m at yearend 2009.
By the end of next year, it plans to have doubled its
international division, which covers Spain, Morocco, Poland,
Greece, Italy, Portugal and Armenia, so it represents 40 per cent
of its revenues. Production at its international arm rose last year
by 25 per cent, to reach €1bn, and net earning grew 13 per cent, to
total €11.3bn. It is ranked 16th in Europe for leasing production
volume.
At SG Equipment Finance, operational vehicle leasing & fleet
management and IT asset leasing and management comprised 18 per
cent, 17 per cent and 5 per cent respectively of the financial
services division net banking income for Q1 2008.
