New business volume for equipment finance companies rose 20% in May though supply chain shortages continued to slow the recovery in capital spending.

The Equipment Leasing and Finance Association said the 25 companies it surveys for its Monthly Leasing and Finance Index signed up for $8.1 billion in new loans, leases, and lines of credit last month, up from $6.7 billion a year earlier. Borrowings were down 17% from April but it was the second straight month of double-digit year-on-year growth.

“While overall industry performance is relatively strong during the first half of this year, even more robust demand for financing is being constrained by supply chain shortages in several economic subsectors,” ELFA Chief Executive Officer Ralph Petta said in a news release.

“With COVID-related payment modifications resolved for the most part, ELFA members report their portfolios performing well,” he added.

The association also said the percentage of borrowers that had their credit approved totaled 77.4% in May, up from 76.3% in April, and that the industry’s monthly confidence index fell to 71.3 in June from 72.1 last month.

A reading of above 50 indicates a positive business outlook.

“Companies across all industries are investing in new projects to stay ahead and better serve their customers, while also investing in technology and programs to better serve their employees in the ‘new normal’ hybrid work environment,” Alan Sikora, CEO of First American Equipment Finance, said.

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