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Equipment Finance Sector Shows Improvement

Equipment Finance Sector Shows Improvement

The $628 billion equipment finance sector continued to show signs of improvement last month as its overall new business volume for February was $5 billion, a 22 percent increase from $4.1 billion the year before.

According to the Equipment Leasing and Finance Association's (ELFA) Monthly Leasing and Finance Index (MLFI-25), though the volume was down 2 percent in February from January, receivables increased to 2.5 percent in February from 1.9 percent in January.

William G. Sutton, president and CEO of the ELFA, stated in a release that while the survey indicated mixed results, the equipment finance sector is experiencing overall improvement.

"The data show that companies continue to invest in equipment, replacing obsolete and worn assets in some sectors while beginning to expand in others," Sutton noted. "The roller coaster trend pattern of our credit-quality metrics, aging of receivables, charge-offs and credit approvals are caused by the unique aspects of different sectors and their cash-flow cycles. However, we see them continuing to move in a positive direction overall."

Reuters reports the results of the survey indicate investing in technology to improve productivity has been the major goal of U.S. companies buying and borrowing equipment.