Equipment Leasing and Finance Index shows growth in December.

Press Release Summary:



Up 27% compared to same period in 2009 and 100% above November's volume, ELFA's Monthly Leasing and Finance Index (MLFI-25) for December shows new business volume at $9.0 billion. Year-end new business volume for 2010 is up 9.2% compared to 2009, and credit quality also improved. Receivables over 30 days decreased to 2.7% from 3.2% in November and 37% compared to 2009. Losses remained at 1.4% compared to prior month. Credit approvals increased to 75%, up 3% from prior month.



Original Press Release:



Equipment Leasing and Finance Association's Survey of Economic Activity: Monthly Leasing and Finance Index



December New Business Volume Surges 27 Percent Year-over-year; 2010 Volume Up 9.2 percent

Washington, DC - The Equipment Leasing and Finance Association's (ELFA) Monthly Leasing and Finance Index (MLFI-25), which reports economic activity for the $521 billion equipment finance sector, showed overall new business volume for December was $9.0 billion, up 27 percent compared to the same period in 2009, and a 100 percent increase from November's volume of $4.5 billion. Typically strong year-end activity is responsible for a large part of this spike in new business volume.

Year-end new business volume for 2010 was $59.6 billion, up 9.2 percent compared to 2009.

Credit quality is improved as well. Receivables over 30 days decreased to 2.7 percent in December, the lowest level in two years, down from 3.2 percent in November, declining by 37 percent compared to the same period in 2009. Losses remained stubbornly flat at 1.4 percent, when compared to the prior month, but showed dramatic improvement over the same period in 2009.

Credit standards showed some slackening as approvals increased to 75 percent in December, up from 72 percent the prior month. Two-thirds of participating organizations reported submitting more transactions for approval during the month.

Finally, total headcount for equipment finance companies remained flat in November and December, a decrease of six percent compared to the same period in 2009. Supplemental data shows that the construction and trucking sectors led the underperforming sectors in December.

Separately, the Equipment Leasing & Finance Foundation's Monthly Confidence Index (MCI-EFI) for January is 69.7, the highest since the MCI was launched in May 2009, and an increase from 64.8 in December. For more detailed information on the MCI-EFI visit www.LeaseFoundation.org

ELFA president William G. Sutton said, "While December is historically a strong month as equipment finance companies complete end-of-year transactions, we continue to be encouraged by the strength and trajectory of these trend lines in business activity."

"It is very encouraging to see the positive momentum building across so many key indicators in our industry," said Stan Herkelman, President, GreatAmerica Leasing Corporation, located in Cedar Rapids, IA, and an MLFI-25 participant. "We are cautiously optimistic as we head into 2011 and see an increasing number of businesses focusing on growth."

About the ELFA's MLFI-25
The MLFI-25 is the only index that reflects capex, or the volume of commercial equipment financed in the U.S. The MLFI-25 is released globally at 9 a.m. Eastern time from Washington, D.C., each month, on the day before the U.S. Department of Commerce releases the durable goods report. The MLFI-25 is a financial indicator that complements the durable goods report and other economic indexes, including the Institute for Supply Management Index, which reports economic activity in the manufacturing sector. Together with the MLFI-25 these reports provide a complete view of the status of productive assets in the U.S. economy: equipment produced, acquired and financed.

The latest Monthly Leasing and Finance Index, including methodology and participants is available below and also at www.elfaonline.org/ind/research/MLFI/

MLFI-25 Methodology
The ELFA produces the MLFI-25 survey to help member organizations achieve competitive advantage by providing them with leading-edge research and benchmarking information to support strategic business decision making.

The MLFI-25 is a barometer of the trends in U.S. capital equipment investment. Five components are included in the survey: new business volume (originations), aging of receivables, charge-offs, credit approval ratios, (approved vs. submitted) and headcount for the equipment finance business.

The MLFI-25 measures monthly commercial equipment lease and loan activity as reported by participating ELFA member equipment finance companies representing a cross section of the equipment finance sector, including small ticket, middle-market, large ticket, bank, captive and independent leasing and finance companies. Based on hard survey data, the responses mirror the economic activity of the broader equipment finance sector and current business conditions nationally.

ELFA MLFI-25 Participants

ADP Credit Corporation
Bancorp South Equipment Finance
Bank of America
Bank of the West
BB&T
Canon Financial Services
Caterpillar Financial Services Corporation
CIT
De Lage Landen Financial Services
Dell Financial Services
EverBank Commercial Finance
Fifth Third Bank
First American Equipment Finance
GreatAmerica
Hitachi Credit America
HP Financial Services
John Deere Financial
Key Equipment Finance
M&I Equipment Finance
Marlin Leasing Corporation
Merchants Capital
National City Commercial Corp.
RBS Asset Finance
Regions Equipment Finance
Siemens Financial Services
Stearns Bank
Susquehanna Commercial Finance, Inc.
US Bancorp
Verizon Capital Corp
Volvo Financial Services
Wells Fargo Equipment Finance

About the ELFA
The Equipment Leasing and Finance Association (ELFA) is the trade association that represents companies in the $521 billion equipment finance sector, which includes financial services companies and manufacturers engaged in financing capital goods. ELFA members are the driving force behind the growth in the commercial equipment finance market and contribute to capital formation in the U.S. and abroad. Its over 600 members include independent and captive leasing and finance companies, banks, financial services corporations, broker/packagers and investment banks, as well as manufacturers and service providers. In 2011, ELFA is celebrating 50 years of equipping business for success. For more information, please visit www.elfaonline.org.

ELFA is the premier source for statistics and analyses concerning the equipment finance sector. Please visit www.elfaonline.org/ind/research/ for additional information.

The Equipment Leasing & Finance Foundation is the non-profit affiliate to the Equipment Leasing and Finance Association, providing future-focused research to the equipment finance industry. For more information please visit the website at www.leasefoundation.org

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