Deutsche Leasing Group has reported a 24 per cent increase in new business written for the financial year ended September 30 2007, bringing total new business to €7.8bn. Deutsche Leasing also said cross-border leasing deals surpassed the €1bn benchmark for the first time.
The company kept an optimistic new business growth target of 10 per cent to 11 per cent for 2008, citing a robust and growing market for equipment leasing in Germany.
Deutsche Leasing did not make available preliminary consolidated profit and loss statements for the year, although the company is scheduled to release audited financial statements next March.
Last year, heightened competition and rising interest rates caused Deutsche Leasing’s net profit to fall by 2.7 per cent to €25.4m even as total revenue grew 2.7 per cent to €3.8bn from the year before.
“We are now reaping the fruits of our consistent strategic alignment as our spectacular growth in new business illustrates,” said chairman, Hans-Michael Heitmüller.
Of total new business, 35 per cent or €2.7bn came from leasing contracts procured through savings banks. Of the 457 German savings banks, 416 share the total equity in Deutsche Leasing.
“The objective is to open up the extensive range of products and services to the savings banks and to adjust it to their requirements on a sustained basis,” Deutsche Leasing said.
During the year Deutsche Leasing introduced a new consumer finance product in the savings bank car loan, currently sold by a quarter of the savings banks in Germany. This product segment recorded €200m in new business for the year.
Meanwhile, overseas transactions are playing a bigger part in revenue contribution. With new business growing by 30 per cent, business transacted overseas has become the second largest business segment.
Quoting market data, Deutsche Leasing said the leasing sector in 2007 will grow by 9.5 per cent through new business of €57.4bn.
Equipment leasing is cracking the €50bn level for the first time while the total financial investment in equipment is growing by 8.2 per cent, according to estimates by the ifo Institut für Wirtschaftsforschung.