Equipment Leasing and Finance Association - Equiping Business for Success

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Monthly Leasing and Finance Index November 2006

Nov 1, 2006, 17:59 PM

The Equipment Leasing and Finance Association (ELFA) Monthly Leasing and Finance Index (MLFI-25) of equipment leasing and finance activity for November releases today, showing overall volume for the period declining when compared to October originations. The MLFI-25 provides metrics reflecting monthly commercial equipment lease and loan activity as reported by the 25 participating ELFA member equipment finance companies.

November originations reported by the MLFI-25 totaled $5.6 billion for new commercial equipment leases and loans, compared to $6.0 billion in the prior month. This softening in new leasing and finance volume mirrors the trend reported by the Institute of Supply Chain Management index for November, in which economic activity in the manufacturing sector failed to grow for the first time in 41 consecutive months.

Portfolio quality remains about the same, with receivables over 90 days flat at 1.1 percent, and average losses improving slightly over the prior period. The trend toward enhanced credit scrutiny continues, with credit approval ratios matching their lowest for the year: 78 percent of all submitted deals. Total headcount increases ever so slightly, continuing a growth trend indicated in 10 of the last 11 months.

Commenting on the month's MLFI-25 results, ELFA President Ken Bentsen stated, "Although origination volume appears to have eased in November, the degree to which it declined along with the favorable credit quality would indicate a continued positive capital investment posture for the commercial economy."

The participant companies in the MLFI-25 represent a broad cross section of the equipment finance sector including small ticket, middle market, large ticket, bank, captive and independent leasing and finance companies. Because the same companies participate in the survey each month, the MLFI-25 provides a consistent trend analysis of current industry activity. Results of each MLFI-25 are posted on the ELFA website and Equipment Leasing Today magazine. Charts and graphs are available for reprint to the media.

The ELFA provides a variety of studies, reports, and market analyses covering the $234 billion equipment finance sector. To access this and other industry information, visit the ELFA website at http://www.elfaonline.org/Ind/Research/ or contact Bill Choi, bchoi@elfaonline.org.

Participants in the ELFA MLFI-25:

  • ADP Credit Corporation
  • Amsouth Leasing Corporation
  • Bank of America Leasing
  • Bank of the West
  • Canon Financial Services
  • Caterpillar Financial Services Corporation
  • CIT
  • De Lage Landen Financial Services
  • First American Equipment Finance
  • GreatAmerica Leasing Corporation
  • Hitachi Credit America
  • HP Financial Services
  • Irwin Financial
  • John Deere Credit Corporation
  • Key Equipment Finance
  • LaSalle National Leasing Corporation
  • Marlin Leasing Corporation
  • National City Commercial Corp.
  • RBS Asset Finance
  • Siemens Financial Services
  • US Bancorp Leasing & Financial
  • US Express Leasing
  • Verizon Capital Corp/Verizon Credit
  • Volvo Financial Services
  • Wells Fargo Equipment Finance

Total New Business Volume (Leases and Loans)

1106-NewBusVol

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Aging of Receivables:

  2006
  Jan Feb Mar Apr May June July Aug Sept Oct Nov
Less than 30 days 98.1% 97.8% 98.0% 98.0% 98.0% 98.0% 97.8% 97.6% 97.7% 97.7% 97.6%
31-60 days 0.9% 1.0% 1.0% 0.9% 1.0% 0.8% 0.9% 1.0% 0.9% 0.9% 1.0%
61-90 days 0.3% 0.4% 0.3% 0.3% 0.3% 0.4% 0.3% 0.4% 0.5% 0.3% 0.3%
Over 90 days 0.7% 0.8% 0.7% 0.8% 0.7% 1.0% 0.9% 1.1% 0.9% 1.1% 1.1%

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Annualized Average Loss (Charge-Offs as a % of Net Receivables)

Annualized Average Loss

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Credit Approval Ratios (As % of All Decisions Submitted)

Credit Approval Ratios

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Total Number of Employees

Total Number of Employees

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