Credit approvals have increased

Finance for new business for the American equipment industry reached USD8.8 billion in April, up 11% year-over-year. Volume was up 7% month-to-month from USD8.2 billion in March, according to the Monthly Leasing and Finance Index (MLFI) just released.

The report found credit approvals also increased, reaching 76.8%, up from 75.3% in March.

Separately, the Equipment Leasing & Finance Foundation's Monthly Confidence Index (MCI-EFI) in May is 59.2, up from the April index of 58.3.

The MLFI-25 is the only index that reflects capex, or the volume of commercial equipment financed in the US.

ELFA president and CEO Ralph Petta attributes the rise in new business volumes to continued low interest rates, a strong labour market and solid economic fundamentals which contributed to healthy demand by U.S. businesses - both large and small - for financed assets to run their business operations. "Historically elevated credit quality also remains a signature feature of financing transactions conducted by ELFA members," he says.

The Equipment Leasing and Finance Association is the trade association that represents companies in the USD1 trillion equipment finance sector, which includes financial services companies and manufacturers engaged in financing capital goods.