ELFA’s Monthly Leasing and Finance Index up 26% month-to-month

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 $900 billion equipment finance sector, showed their overall new business volume for March was $9.3 billion, up 4 percent year-over-year from new business volume in March 2020. Volume was up 26 percent month-to-month from $7.4 billion in February. Year-to-date, cumulative new business volume was down 1 percent compared to 2020.

Receivables over 30 days were 1.9 percent, down from 2.1 percent the previous month and down from 2.6 percent in the same period in 2020. Charge-offs were 0.43 percent, down from 0.55 percent the previous month and down from 0.55 percent in the year-earlier period.

Credit approvals totaled 77 percent, up from 75.8 percent in February. Total headcount for equipment finance companies was down 15.2 percent year-over-year, a decrease due to significant downsizing at an MLFI reporting company. Separately, the Equipment Leasing & Finance Foundation’s Monthly Confidence Index (MCI-EFI) in April is an all-time high of 76.1, and an increase from the March index of 67.7.

“The equipment finance industry appears poised to take advantage of an economic tailwind that is manifesting itself in an improving labor market, a continued low interest-rate environment, a strong corporate earnings season, and high business confidence that is creating demand for investment in commercial equipment,” commented ELFA President and CEO Ralph Petta. E"LFA member organizations also report improving portfolio quality, which is reflective of their customers’ ability to meet their payment obligations as the pandemic’s grip on many businesses loosens.”

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 a time series that reflects two years of business activity for the 25 companies currently participating in the survey. The latest MLFI-25, including methodology and participants, is available via ELFA here.