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ELFA: August New Business Volume Up 14% Y/Y, 2.8% YTD

September 26, 2023, 07:10 AM

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 $1 trillion equipment finance sector, showed their overall new business volume for August was $10.1 billion, up 14 percent year-over-year from new business volume in August 2022. Volume was up 2 percent from $9.9 billion in July. Year-to-date, cumulative new business volume was up 2.8 percent compared to 2022.

Receivables over 30 days were 2.3 percent, unchanged from the previous month and up from 1.5 percent in the same period in 2022. Charge-offs were 0.34 percent, up from 0.32 percent the previous month and up from 0.17 percent in the year-earlier period.

Credit approvals totaled 75.1 percent, down from 75.3 percent in July. Total headcount for equipment finance companies was down 2.3 percent year-over-year.

Separately, the Equipment Leasing & Finance Foundation’s Monthly Confidence Index (MCI-EFI) in September is 50.3, steady with the August index of 50.4.

ELFA President and CEO Ralph Petta said, “At its recent meeting, the Fed signaled to keep interest rates artificially elevated for the time being, hoping to continue its campaign to control inflation. Despite this higher interest rate environment, many businesses continue to invest in productive assets. As they do, equipment finance companies are providing the necessary capital to help these businesses thrive and prosper.”     

Craig Weinewuth, President and Chief Executive Officer, Mitsubishi HC Capital America, Inc., said, “The August MLFI survey results are encouraging given recent economic turbulence caused by high interest rates and inflationary pressures. Growth in new business volume is improving across all industries, especially for technology assets, clean energy assets, and projects in transportation and construction. As an independent lender, we are also experiencing an increase in activity as companies are looking for flexible financing alternatives amid credit tightening. Companies will always need access to capital to support and sustain growth, and we expect demand for financing new equipment to continue to strengthen as the economic environment improves.”

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