US leasing volumes continue to fall in 2010

25/02/2010
US businesses continued to postpone new capital investment in January, but overdue receivables stabilised, and defaults fell, according to a trade group for lenders that finance half the capital equipment investment in the United States. The Equipment Leasing and Finance Association (“ELFA”) reported that total volume of new business fell to $3.4 billion in January, down 24.4 percent from last January, and down 52 percent from the previous month. However, other measures suggest that businesses are finding it a little easier to remain current on their existing loans. ELFA said the percentage of borrowers delinquent 30 days or more on their capital spending loans, leases or lines of credit was 4.3 percent in January, unchanged from December but up from 4.0 percent last year. Those delinquencies peaked in September 2009 at 5.6 percent of total receivables. Charge-offs, or the percentage of receivables the lenders considered uncollectable fell for a second straight month to 1.68 percent in January, down from 2.08 percent in December but up from 1.41 percent last year. Those losses also peaked last September at a little over 3 percent of total capital spending receivables.

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