ELFA’s Monthly Leasing and Finance Index Shows 14% Y/Y Increase in August New Business Volume

The Equipment Leasing and Finance Association’s 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 overall new business volume for August was $10.1 billion, up 14% year over year from new business volume in August 2022. Volume was up 2% from $9.9 billion in July. Year-to-date, cumulative new business volume was up 2.8% compared to 2022.

Receivables more than 30 days were 2.3%, unchanged from July and up from 1.5% in August 2022. Charge-offs were 0.34%, up from 0.32% in July and up from 0.17% in August 2022.

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

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

“At its recent meeting, the [Federal Reserve] signaled to keep interest rates artificially elevated for the time being, hoping to continue its campaign to control inflation,” Ralph Petta, president and CEO of the ELFA, said. “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.”

“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,” Craig Weinewuth, president and CEO of Mitsubishi HC Capital America, said. “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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