According to 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 $900 billion equipment finance sector, overall new business volume for September was $9.2 billion, up 6% year over year from new business volume in September 2020. Volume was up 8% month over month from $9.9 billion in August. Year-to-date cumulative new business volume was up 10% compared with 2020.

Receivables more than 30 days were 1.6%, down from 1.8% the previous month and down from 2% in the same period in 2020. Charge-offs were 0.35%, up from 0.23% the previous month and down from 0.82% in the year-earlier period.

Credit approvals totaled 76.3%, unchanged from August. Total headcount for equipment finance companies was down 14% year over year, a decrease due to significant downsizing at an MLFI reporting company, according to the ELFA.

Separately, the Equipment Leasing & Finance Foundation’s Monthly Confidence Index (MCI-EFI) in October is 61.1, an increase from the September index of 60.5.

“Originations in the equipment finance industry continue to tick up, with September new business volume showing good growth compared to the same period last year,” Ralph Petta, president and CEO of the ELFA, said. “Supply chain disruptions and inflation concerns continue, with the Fed poised to gradually ease its asset purchases in the near term. For now, liquidity is abundant and businesses are acquiring the productive equipment necessary to respond to customer demand in a variety of market sectors. Portfolio quality is mixed, however, with lower delinquencies offset by slightly higher charge offs for the 25 responding MLFI participants.”

“The September MLFI data display encouraging signs of improvement for the industry, with new business volume increasing and delinquency decreasing from August,” Robert L. Boyer, president of First Commonwealth Equipment Finance, said. “Losses are trending higher but remain in a range below what we saw in comparable pre-pandemic periods. Looking forward, it seems this is a story of tailwinds and headwinds. A slight increase in the foundation’s October Monthly Confidence Index, reduced levels of COVID-19 cases from the late summer peak and increasing demand are indications that things will continue to improve. On the other hand, supply chain disruption, significant increases in equipment prices and low worker supply continue to hamper expansion in major industry sectors our industry serves. This should really make for an interesting fourth quarter.”