The Monitor 101+ is back for its third-straight year and with positive growth to report both in terms of net assets and new business volume. This year’s group of Monitor 101+ companies, which grew to 35 and included 22 Independents, 11 U.S. Bank Affiliates and two Captives, combined to accrue $3,419 million in net assets in 2021, marking a 20% increase from 2020, while reporting $2,877.6 million in new business volume, a total that surpassed the group’s 2020 output by 30.8%.
The Top Five
This year’s top five in the Monitor 101+ is made up of a collection of former Monitor 100 companies, a first-time ranker and two returning members of the group.
Macrolease Corporation slipped ever so slightly from the Monitor 100, as it was ranked No. 100 last year before earning the top spot in this year’s Monitor 101+ on the back of $207.3 million in total assets. Despite the small decline in ranking, Macrolease actually grew its portfolio by 15% compared with 2020, showing just how competitive the equipment finance industry can be.
Sirius Financial Services, formerly known as Forsythe/McArthur, is another company that slipped from the Monitor 100 to the Monitor 101+, finishing in the No. 102 spot this year while netting $204 million in total assets in 2021, a 34.9% reduction from 2020. For context, that $204 million portfolio would have been good enough to rank in the Monitor 100 just last year.
Following Macrolease and Sirius Financial Services are are UniFi Equipment Finance and First Foundation Bank’s equipment finance division. UniFi Equipment Finance reenters the ranking after a year hiatus at No. 103 with $202.4 million in total assets, marking a 13.1% increase. Meanwhile, First Foundation made its debut at No. 104 by reporting $201.2 million in net assets, accounting for a 21.6% increase compared to 2020.
Accord Financial came in at No. 105 to round out the top five. Accord Financial grew its portfolio by 28.7%, boosting it to $194.4 million. Thanks to the strong increase, the company rose five spots from its ranking of No. 110 in last year’s Monitor 101+.
Segment Overview — Net Assets
Most of this year’s Monitor 101+ is made up of Independents and, unsurprisingly, this segment of the group accounted for the largest share of the total assets reported for this year’s ranking. The Independents combined portfolios totaled $1,635 million, which equates to 47.8% of the entire Monitor 101+ group’s combined total. Interestingly, that 47.8% share is up from the Independent’s 46.6% share last year. In addition, the Independents in this year’s ranking grew their portfolios by a combined 23.1% compared to 2020, with eight companies reporting an increase of more than 100%.
On the the U.S. Bank Affiliate side, companies in this segment also reported solid growth, with a combined increase in total assets of 21.7% to $1,448.3 million. Like the Independents, the U.S. Bank Affiliates also took a greater slice of the overall pie, increasing their share of the group’s combined total asset production from 41.9% to 42.4%. While the 11 U.S. Bank Affiliates featured far fewer companies with triple-digit growth rates compared with the Independents (Meridian Equipment Finance was the only such company to report better than 100% growth), only two suffered a decrease in total assets in 2021.
Turning over to the Captives, with only Sany Capital USA and OnPoint Capital in the mix, this segment accounted for $335.7 million in total assets, up 1.5% from last year. Sany Capital USA and OnPoint Capital were the only Captives in last year’s ranking as well, but this year, they took up only 9.8% of the final asset total compared with 11.5% a year ago. Both companies reported growth in their portfolios (1.7% for Sany Capital USA and 1.3% for OnPoint Capital).
Top Five ENI Gainers
Meridian Equipment Finance really showed up to represent the U.S. Bank Affiliates this year, as in addition to being the only company from the segment to surpass 100% year-over-year portfolio growth in 2021, it also led all Monitor 101+ companies in ending net investment gained at $60.4 million, increasing its total asset count to $92.9 million for the year and earning it a 10-spot rise from No. 126 to No. 116 in the ranking.
After Meridian Equipment Finance, the next three highest dollar gainers were all Independents. Alliance Funding Group was just behind Meridian with an increase of $57 million, while Clarus Capital and Accord Financial also had sizeable dollar gains of $47.7 million and $43.3 million, respectively. Alliance Funding Group’s production equated to 195.9% growth and helped it ascend nine spots in the ranking, finishing at No. 118 with $86.1 million in total assets. Clarus Capital is new to the ranking, having officially launched at the end of 2021, yet it still managed to fight its way to the No. 125 overall spot and a top five place in total dollar gains. Accord Financial’s total dollar gain was good for a 28.7% increase in net assets and helped it make a climb into the top five in the overall asset ranking with $194.4 million in total assets.
North Star Leasing, a division of Peoples Bank, was the fifth highest gainer in terms of dollar amount in 2021, growing its portfolio by $42.1 million (or 52.5%) to $122.3 million. That allowed it to narrowly edge out new entrant Commercial Capital Company for a top five spot in total dollars gained.
Top Five Percentage Gainers
When looking at the top percentage gainers in terms of assets, we first must discuss the performance of two newcomers. Clarus Capital and Atlys Capital, who finished No. 125 and No. 128, respectively, in the overall ranking in their first showing in the Monitor 101+ are both relatively new companies. As mentioned previously, Clarus Capital was officially launched near the end of 2021, while Atlys Capital got its start in 2020. Both reported $0 in assets for 2020 but earned a spot on the Monitor 101+ this year with impressive portfolio growth in their initial stages as a company, with Clarus Capital achieving $47.7 million in total assets and Atlys Capital reaching $33.6 million. Unfortunately, until the rules of math change, we can’t actually put a number on their percentage gains.
Moving over from abstract math philosophy, we can clearly say that Regents Capital had the highest calculable percentage growth in assets among Monitor 101+ companies, reporting an astonishing 886.7% growth rate to reach $14.8 million in total assets. Even with such growth, Regents Capital still took one step back, finishing at No. 133 in the overall ranking after landing at No. 132 a year ago. Elsewhere among top percentage gainers, Honour Capital entered the ranking at No. 129 with 698.4% growth to reach $31.5 million, while XS Financial moved up four spots to No. 127 on 447.6% growth to hit $34.5 million in total assets. Alliance Funding Group (195.9%) and Merdian Equipment Finance (185.9%) also surpassed triple digits in their portfolio growth rates.
$100MM Club
Four companies joined the $100 million club among Monitor 101+ companies this year. Commercial Capital Company and North Star Leasing, which we have already discussed, crossed the $100 million threshold, with $126.5 million and $122.3 million in net assets, respectively. The others include No. 113 Renasant Bank ($125.1 million in net assets, up from $90.3 million) and No. 115 Blue Bridge Financial ($111.9 million in net assets, up from $77.5 million).
YE 2021 ENI Forecast
We asked each company in the Monitor 101+ (and the Monitor 100 for that matter) to provide a forecast for ending net investment at the end of 2022 for their businesses. In the interest of full transparency, many of these forecasts were made prior to the economic fluctuations of this year, including the rapid rise in inflation, interest rate hikes, continued supply chain disruption and the war in Ukraine. In addition, two companies opted not to provide a forecast. Overall, most company leaders reported optimism for 2022, with the group of Monitor 101+ companies expecting to reach a combined $4,523.3 million in total assets by the end of 2022, which would make for a 32.3% year-over-year increase.
New Business Volume
This year’s group of Monitor 101+ companies originated a combined $2,877.6 million in new business volume, which was up 30.8% from the $2,200.6 million these firms accrued in 2020. Of the 35 companies, 27 reported an increase in new business volume, yielding a combined total of $816.2 million, while the eight companies that reported a decline combined to fall back by $139.2 million.
The Top Five — NBV
Two of the top five companies in terms of new business volume in this year’s ranking were also among the top companies in terms of total assets: Sirius Financial Services and Accord Financial. Sirius Financial Services had the third-highest new business volume total at $140 million despite reporting a 40.1% volume decrease. Meanwhile, Accord Financial came in fourth in new business volume among Monitor 101+ companies with $135.4 million. Accord Financial boosted its volume by 160.4%, making it one of only six companies to achieve more than 100% growth and helping it go from No. 117 in the volume ranking last year to No. 104 this year.
While Sirius Financial Services and Accord Financial were in the top five in both assets and volume, Liberty Commercial Finance and Alliance Funding Group were once again the top two performers when it came to volume. Liberty Commercial Finance was the only company to report more than $300 million in new business volume for 2021, amassing a total of $353.1 million to land the top spot. Alliance Funding Group racked up $262.9 million in new business volume to finish second. No other company reached the $200 million mark beyond those two, which finished No. 101 and No. 102 in the volume ranking last year as well.
Rounding out the top five companies in terms of new business volume was Partners Capital Group, which finished with $132.4 million and moved up three spots to No. 105 in the volume ranking.
Segment Performance — Volume
As you may have noticed, the entire top five in total business volume was made up of Independents. Powered by that chart-topping production, the Independents easily accounted for the lion’s share of the new business volume total for the entire Monitor 101+ group. Overall, the 22 Independents produced $1,922.1 million in new business volume, which was a 34.5% increase compared with a year ago and contributed 66.8% of the total volume for the entire ranking.
Of the 11 U.S. Bank Affiliates, three surpassed $100 million in new business volume, led by OnePlace Capital ($102.5 million) and followed by First Foundation Bank ($101.3 million) and UniFi Equipment Finance ($101 million). When taken overall, this segment’s volume total was 28.1% higher than last year and made up 25.4% of the entire Monitor 101+ total.
On the Captive side, Sany Capital USA reported $125.5 million in new business volume for 2021, marking a 7.6% year-over-year increase, while OnPoint Capital finished with $97.9 million in new business volume thanks to a 17.5% year-over-year increase.
Notable Performances
Monitor 101+ newcomer Honour Capital had the largest percentage increase in new business volume among this year’s group, reporting a 743.3% jump from $9.5 in 2020 to $79 million in 2021. Other triple-digit percentage gainers included XS Financial (419.7%), Accord Financial (160.4%), Entegra Capital (159.8%), Meridian Equipment Finance (118.2%) and LeasePoint Funding Group (103.2%).
Retrospective
Each year, we ask Monitor 101+ participants to provide an overview of the challenges they faced in the preceding year. The following are a sample of the responses:
- Captive: Supply chain delays were the biggest challenges. Delivery delays hurt 2021 in a major way.
- Independent: Supply chain issues combined with banks reentering the marketplace negatively impacted our results.
- U.S. Bank Affiliate: As a bank, we devoted an enormous amount of resources to the [Paycheck Protection Program] loans and weren’t able to focus on equipment finance as much as normal.
- Independent: Dealing with lack of new inventory, which in turn drove used equipment pricing up. Used equipment pricing was in territories never seen before. The challenge was to determine what was the “right” amount to finance.
- U.S. Bank Affiliate: Headwinds were created, in our opinion, by increase[d] competition in the vendor and indirect channels.
- Rate pressure caused margin compression. Finding new talent to support our growth also proved challenging.
ABOUT THE AUTHOR: Phil Neuffer is senior editor of Monitor.
