ELFA December MLFI-25 Jumps 65% M/M, Reports Modest Y/Y Gain of 2%

The Equipment Leasing and Finance Association’s (ELFA) Monthly Leasing and Finance Index (MLFI-25) showed their overall new business volume for December was $12.9 billion, up 2% year-over-year from new business volume in December 2018. Volume was up 65% month-to-month from $7.8 billion in November in a typical end-of-year spike. Cumulative new business volume for 2019 was up 5% from 2018.

Receivables over 30 days were 2.20%, up from 1.80% the previous month and up from 1.70% the same period in 2018. Charge-offs were 0.51%, up from 0.43% the previous month, and down from 0.55% in the year-earlier period.

Credit approvals totaled 77.1%, up from 75.7% in November. Total headcount for equipment finance companies was down 3.3% year-over-year.

Separately, the Equipment Leasing & Finance Foundation’s Monthly Confidence Index (MCI-EFI) in January is 59.9, an increase from the December index of 56.2.

ELFA President and CEO Ralph Petta said, “Equipment finance companies ended the year with steady 5% cumulative new business growth.  However, some ELFA member organizations are seeing slightly elevated levels of stress in their portfolios, corroborating evidence that soft patches can be found in some sectors of the U.S. economy. Whether recent relaxation of nagging trade tensions between the U.S. and several of its trading partners improves conditions in the industrial and ag sectors of the U.S. economy remains to be seen as we move deeper into the new year.”

Tony Golobic, chairman and chief executive officer, GreatAmerica Financial Services, said, “We have done well for the past 12 months. While our new business volume has increased a modest 6%, our spreads have shown a nice improvement and the quality of our business is quite satisfactory. There has been a slight uptick in our credit losses, yet they continue to be substantially below ‘normal’ levels. We are optimistic about calendar year 2020, foreseeing modest growth of quality and profitable volume as we work hard to help our customers be even more successful.”

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