ELFA monthly leasing and finance index shows business volume flat year-over-year

The Equipment Leasing and Finance Association’s (ELFA) Monthly Leasing and Finance Index (MLFI-25), which reports economic activity from 25 companies representing a cross section of the $827 billion equipment finance sector, showed their overall new business volume for October was $7.6 billion, unchanged from new business volume in October 2012. Month-over-month, new business volume was down 1% from September. Year to date, cumulative new business volume increased 5% compared to 2012.

Receivables over 30 days were at 1.5% in October, unchanged from September. Delinquencies declined from 1.7% in the same period in 2012. Charge-offs were unchanged from the previous two months at 0.4%, and only slightly higher than the all-time low of 0.3%.

Credit approvals totaled 77.6% in October, up slightly from 77.3% the previous month. Eighty-two percent of participating organizations reported submitting more transactions for approval during October, a spike from 56% in September.

Finally, total headcount for equipment finance companies was up 1% year over year.

Separately, the Equipment Leasing & Finance Foundation’s Monthly Confidence Index (MCI-EFI) for November is 56.9, an increase from the October index of 54.0, demonstrating an overall steady industry outlook despite continuing concerns about the U.S. economy and the negative impact of federal government fiscal policies.

ELFA president and CEO William G. Sutton, CAE, said: “As we enter the final quarter of the year, the equipment finance industry continues to perform well, illustrated by healthy new business generation and solid credit quality metrics. We remain cautiously optimistic that business demand for capital equipment will continue unabated into the 4th Quarter, which is a typically strong period for the industry. We hope that the ongoing and unresolved debate over fiscal policy will not act as a drag on the overall economy and the industry as we end 2013 and enter a new year.”

David Mirsky, CEO, Pacific Rim Capital, Inc., said: “The MLFI-25 clearly demonstrates the current slow growth or no growth economy that we are experiencing at the moment. However, the industry remains optimistic based upon the year-to-date growth of 5 percent and the increase in submissions for credit approval. Pacific Rim Capital has experienced slightly stronger growth in its sector and is planning for conservative expansion until the uncertainties in the economy are clarified.”