WASHINGTON--(BUSINESS WIRE)--The Equipment Leasing and Finance Association’s (ELFA) 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 their overall new business volume for August was $7.8 billion, up 1 percent year-over-year from new business volume in August 2016. Volume was down 1 percent month-to-month from $7.9 billion in July. Year to date, cumulative new business volume was up 6 percent compared to 2016.
Receivables over 30 days were 1.50 percent, up from 1.40 percent the previous month and up from 1.30 percent in the same period in 2016. Charge-offs were 0.44 percent, up from 0.35 percent the previous month, and flat with the year-earlier period.
Credit approvals totaled 75.3 percent in August, down slightly from 76.0 percent in July. Total headcount for equipment finance companies was up 17.0 percent year over year, largely attributable to continued acquisition activity at an MLFI reporting company.
Separately, the Equipment Leasing & Finance Foundation’s Monthly Confidence Index (MCI-EFI) for September is 63.7, easing from 64.4 in August.
ELFA President and CEO Ralph Petta said, “After a relatively strong second quarter in which growth in the overall economy is in the 3 percent range, end-of-summer equipment financing volume also is on solid footing. Despite Washington lawmakers’ inability—at least, thus far—to agree on necessary changes in tax and financial services policy, U.S. business owners appear optimistic about the health of the economy, providing impetus for them to grow their businesses. In addition, we are seeing improvements in challenged energy sectors, and interest rates continue to be low by historical standards. With low unemployment, healthy consumer spending, and equities and fixed income markets at historic highs, the economy is in good shape. This bodes well for continued investment in equipment by businesses, both large and small.”
Robert Neagle, President and General Manager, Merchant Finance Division, Ascentium Capital LLC, said, “The equipment leasing and finance industry continues to support capital formation in the U.S. with a 5.5 percent uptick in new business volume through eight months of 2017 compared to eight months of 2016. As has been the pattern throughout the past couple of years, the expectation is for a stronger third quarter end. While there was a slight move up in delinquency in August, asset quality continues hovering in a fairly consistent range month-to-month. The summer is over and so is any seasonal leveling of new business volume.”
About the ELFA’s MLFI-25
The MLFI-25 is the only index that reflects capex—the volume of commercial equipment financed in the U.S.—and is released as a complementary economic indicator the day before the U.S. Department of Commerce releases the durable goods report.
To read a detailed description and methodology of the MLFI-25, visit http://www.elfaonline.org/Data/MLFI/
About the ELFA
The Equipment Leasing and Finance Association (ELFA) is the trade association that represents companies in the $1 trillion equipment finance sector, which includes financial services companies and manufacturers engaged in financing capital goods. ELFA members are the driving force behind the growth in the commercial equipment finance market and contribute to capital formation in the U.S. and abroad. Its more than 575 members include independent and captive leasing and finance companies, banks, financial services corporations, broker/packagers and investment banks, as well as manufacturers and service providers. ELFA has been equipping business for success for more than 50 years. For more information, please visit www.elfaonline.org.