Association recognizes members of 2023 Research Committee

Washington, DC, July 18, 2023 — The equipment finance industry saw new business volume increase 6.3% in 2022, according to the 2023 Survey of Equipment Finance Activity (SEFA) released today by the Equipment Leasing and Finance Association (ELFA). This is a modest decrease from NBV growth of 7.4% in 2021. The 2023 SEFA reveals key statistical, financial and operations information for the $1 trillion equipment finance industry, based on a comprehensive survey of 102 equipment finance companies. Members of the ELFA Research Committee (listed below) play an important role in developing the survey report. 

“We are pleased to share the results of the 2023 Survey of Equipment Finance Activity. This comprehensive source of industry data is made possible by ELFA member companies who responded to the survey, and we thank them for their participation,” said Bill Choi, ELFA VP of Research & Industry Services. “I encourage all members to review the data and put it to work for your business. If you have any questions about benchmarking your company, using our interactive dashboard or other SEFA tools, please feel free to contact me.”

Survey Highlights

Key findings for 2022 as reported in the 2023 SEFA include:

• New business volume at equipment finance companies continued to be strong after rebounding in 2021 from the pandemic. Among survey respondents 75% experienced an increase in volume in 2022.
• Cost of funds were a major takeaway of this year’s report with a jump of 211 basis points (bps) between 2021 and 2022 as a result of Federal Reserve interest rate hikes. Managing this cost of funds increase will be a major emphasis as equipment finance companies make their way through the current higher-interest-rate climate.
• By organization type, banks saw a 7.4% increase in new business volume, captives remained flat and independents, representing a much smaller group, saw a 29.4% increase. By market segment, NBV rose a modest 0.2% in the large ticket segment, while it increased 7.3% year over year in both middle and small ticket.
• From an asset perspective, the top-five most-financed equipment types were transportation, agriculture, construction, IT & related technology services, and industrial/manufacturing. The top five end-user industries representing the largest share of new business volume were services, agriculture, industrial & manufacturing, transportation and construction.
• Use of electronic documents continued to grow with 88% of respondents reporting that at least some of their NBV is documented via an electronic document. This number has risen steadily over the past five years, up from 50% of respondents in 2018.
• Delinquencies increased to 2.3% overall, from 1.1% in 2021, with mining/oil & gas extraction and transportation-railroad continuing to experience the highest delinquency rates.
• Charge-offs decreased slightly to 0.22% of average receivables in 2022 due to a stronger recovery rate that was much higher than the previous years’ amounts.
• Credit approvals increased year over year, while the percentage of those approved applications being booked declined slightly. The number of applications decreased, but the dollar volume increased, an indication of the inflation the overall economy is experiencing.
• Employment increased by 3.8% overall. Independents, captives and banks increased their headcount by 8.5%, 4% and 2.5% respectively year over year.
• Work location arrangements reveal hybrid models show no signs of abating. More than 90% said they spend some of their time working remotely, and 36% reported spending fewer than five days a month working in a company office location. By comparison, pre-COVID, 84% of the respondents’ workforces went to the office full-time.

In addition to the 2023 SEFA, ELFA released the 2023 Small-Ticket SEFA, which focuses on small-ticket and micro-ticket equipment transactions among the SEFA respondents. The report found that new business volume in the small-ticket space increased by 7.5% in 2022.

Research Committee

ELFA recognized the members of its Research Committee, who provide support and direction in the development of the SEFA and the interpretation, analysis and presentation of the results:

• Mark Walters, Director, Finance, DLL (Committee Chair)
• Jeffrey Bell, VP, Key Equipment Finance
• John Clifford, Strategic Planning & Business Intelligence Manager, Toyota Industries Commercial Finance, Inc.
• Sabah Khan, Global Risk, CNH Industrial Capital
• Stephen Morrissey, Finance Director - US and CA, John Deere Financial
• Jessica O'Brien, Vice President, Citizens Asset Finance, a division of Citizens Bank, N.A.
• Kevin Prykull, CLFP, Adjunct Professor in Finance - Duquesne University
• Kevin Sensenbrenner, SVP/Senior Managing Director, Head of Asset Management, Stonebriar Commercial Finance
• Shelly Tauer, EF Systems Product Group Manager, U.S. Bank
• Joseph Turner, VP, Strategy and Analytics, First Citizens Bank Equipment Finance

Access the Data

The 2023 SEFA data are available in a variety of formats at www.elfaonline.org/SEFA:  

• Full SEFA Report: This 350+ page report offers comprehensive performance metrics for 102 equipment finance companies.
• Interactive SEFA Dashboard: This online dashboard showcases executive summary data going back to 2006.
• MySEFA: This interactive data tool lets SEFA survey respondents track their own operational and performance statistics and compare them against their peers.

PricewaterhouseCoopers LLP administers the SEFA. For more information, please contact Bill Choi at bchoi@elfaonline.org.

About ELFA

The Equipment Leasing and Finance Association (ELFA) is the trade association that represents companies in the nearly $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 580 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 60 years. For more information, please visit www.elfaonline.org.

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Media/Press Contact: Amy Vogt, Vice President, Communications and Marketing, ELFA, 202-238-3438 or avogt@elfaonline.org