Latin American Equipment Leasing/Finance Industry Declines 6%

NOV 3, 2011 - 8:10 am

Latin America’s equipment leasing and finance industry is experiencing “growing pains” after a period of exuberant expansion, according to annual research by The Alta Group Latin American Region (LAR). Though some countries and companies witnessed growth, the region’s overall leasing portfolio declined 6% in 2010 as measured in U.S. dollars, notes the Alta LAR 100 report.

Leasing leaders will discuss details of the report November 17-18, 2011 at the IX Latin American Leasing Conference in Miami.

“In light of the fact that the economy grew 5% in Latin America, we were surprised that the overall leasing portfolio did not grow,” said Rafael Castillo-Triana, CEO of The Alta Group LAR, global consultants to the equipment leasing and finance industry. “The Latin American leasing industry is having growing pains. It is maturing, and business models are making a substantial transformation from pure finance and credit leases, to business models centering more on operating leases. This changes the way companies allocate their capital, go to market, and originate business.

“Other factors that had an impact on the industry included the 2008 financial crisis, the relative depreciation of the U.S. dollar, and, in certain Latin American countries, tax reform and political leadership,” Castillo-Triana explained.

The report details:

the growth or decline of leasing portfolios in individual countries;

contributing factors to leasing trends;

the region’s fastest growing leasing companies; and

the 100 largest leasing operations

Brazil’s leasing industry, which holds 63% of the region’s portfolio, decreased 9% in 2010. Large bank-affiliated leasing companies drove the downturn, while well-known captive leasing companies and vendor-oriented leasing companies achieved notable success, according to the report. Other countries with declining leasing portfolios included Guatemala (95%), Dominican Republic (55%), Venezuela (41%), Ecuador (35%), and Puerto Rico (30%).

Countries achieving growth in challenging times included Colombia (7%), Peru (12 %), Mexico (19%), Chile (22 %), Bolivia (25 %), Argentina (68%) and Costa Rica (147%).

A complimentary report will be posted soon on www.thealtaconferencias.com. To purchase detailed reports, contact Katrin Forster-Csvany at 954-632-0922, [email protected].

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