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ELFA: November New Business Volume Up 17% Y/Y, Up 5% YTD

December 20, 2017, 07:15 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 November was $7.5 billion, up 17 percent year-over-year from new business volume in November 2016. Volume was down 11 percent month-to-month from $8.4 billion in October. Year to date, cumulative new business volume was up 5 percent compared to 2016.

Receivables over 30 days were 1.50 percent, up from 1.40 percent the previous month and up from 1.30 percent the same period in 2016. Charge-offs were 0.42 percent, up from 0.41 percent the previous month, and up from 0.40 percent in the year-earlier period.

Credit approvals totaled 73.6 percent in November, down from 74.6 percent in October. Total headcount for equipment finance companies was up 17.9 percent year over year, largely attributable to continued acquisition activity at an MLFI reporting company.

Separately, the Equipment Leasing & Finance Foundation’s Monthly Confidence Index (MCI-EFI) in December is 69.4, up from 67.0 in November.

ELFA President and CEO Ralph Petta said, “As we near the end of the fourth quarter, new business volume for the month continues the moderate growth trend in the equipment finance industry that began a few years ago. Despite a slight deterioration in credit quality, the industry appears poised to end the year on a high note. Time will tell if conditions favorable to business investment will remain in place in the coming year. We think so. Members typically look forward to a strong closing month and December looks to be no exception.”
Gary W. LoMonaco, Vice President-Treasurer, Forsythe/McArthur Associates, Inc., a Sirius Company, said, “2017 has been a very strong year for investment in capital equipment. The year-over-year originations numbers reflect that strength. Although many forecasts for 2018 expect somewhat lower capital investment levels, the equipment leasing and finance industry is optimistic for next year, as rising interest rates have historically driven companies toward financing acquisitions rather than paying cash. There is also excitement around fresh financial offerings such as consumption-based and managed services financing.”

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