Marijana No Comments

UK asset finance market posts strong Q3 results as businesses stockpile in anticipation of Brexit

Asset finance new business (primarily leasing and hire purchase) grew 5% during Q3 2019 compared to the same period last year, according to figures from the Finance & Leasing Association (FLA).

The association also reported 5% year-on-year growth during September.

The strongest September growth came from finance for plant and machinery and business cars, while aircraft, ships and rolling stock finance leapt 78%, but from a relatively low base.

In contrast, commercial vehicles remained flat during the month, although demand was up 8% for the quarter and 14% over the preceding 12 months.

IT equipment finance fell 10% and business equipment finance was down 1% during the month compared to the same period in 2018.

Geraldine Kilkelly, head of research and chief economist at the FLA, said: “In September, the asset finance industry reported its strongest growth in new finance for plant and machinery since January 2019 as businesses stockpiled ahead of another Brexit deadline.

“The industry has seen total new business grow in all but one month so far in 2019, with the latest annual new business total reaching a record level of £34.5 billion.”

Lease/hire purchase remains the dominant form of finance, accounting for 57% of the market in September and reporting year-on-year growth of 4%.

Sep 2019 % change on

prev yr

3 mths to

Sep 19

% change on

prev yr

12 mths to

Sep 19

% change on

prev yr

Total FLA asset finance (£m); 2,907 +5 8,454 +5 34,474 +7
Total excluding high value (£m) 2,688 +5 7,862 +5 31,959 +5
By asset:
Plant and machinery finance (£m) 623 +15 1,850 +9 7,445 +12
Commercial vehicle finance (£m) 730 0 2,148 +8 9,098 +14
IT equipment finance (£m) 309 -10 757 -8 2,663 -6
Business equipment finance (£m) 180 -1 1,584 -4 2,597 +5
Car finance (£m) 712 +4 2,160 +4 8,965 0
Aircraft, ships and rolling stock finance (£m) 20 +78 87 +71 541 +126
By channel:
 Direct finance (£m) 1,217 -1 3,859 +4 16,062 +6
 Broker-introduced finance (£m) 541 +4 1,623 +5 6,616 +12
Sales finance (£m) 930 +15 2,380 +6 9,281 +1
By product:
Finance leasing (£m) 405 -8 1,064 +2 4,256 +7
Operating leasing (£m) 501 +1 1,473 0 6,103 -1
Lease/Hire purchase (£m) 1,566 +4 4,718 +8 19,497 +10
Other finance (£m) 280 +20 877 +5 3,313 +8

Written by John Maslen

Source: Asset Finance International

Marijana No Comments

Asset finance share of UK equipment investment highest for a decade in May

Asset finance new business (primarily leasing and hire purchase) in the UK for deals of up to £20 million grew by 6% in May, compared to the same month last year, according to new data from the Finance and Leasing Association.

When deals over £20 million are included, the market fell by 1%.

New finance for plant and machinery and commercial vehicles both grew by 8% year-on-year during the month, while the business equipment finance sector reported new business up by 3% over the same period.

The car finance market was static, while the IT finance sector fell by 9% year-on-year.

Geraldine Kilkelly, Head of Research and Chief Economist, said: “The asset finance market continued to report growth across many sectors in May, with new business overall up by 8% in the first five months of 2019.

“The strong performance so far this year means that the industry is helping to fund an increasing share of business investment.

“The percentage of UK equipment investment funded by asset finance members in Q1 2019 was 38%, the highest for more than a decade.”

Written by John Maslen

Source: Asset Finance International

Marijana No Comments

UK asset finance market grows by 11% in first quarter of 2019

Asset finance new business (primarily leasing and hire purchase) grew by 11% during Q1 2019 compared to the same period last year, according to new figures released today by the Finance & Leasing Association (FLA).

New finance for manufacturing and construction equipment increased by 25% and 26% respectively, compared to Q1 2018.

The growth followed a strong market in March, which grew by 11% year-on-year, with including particularly high growth in commercial vehicle finance and IT equipment finance sectors.

All channels delivered growth during the quarter, although the strongest performance came from broker-introduced finance, which rose 19% year-on-year.

During March, broker-introduced finance accounted for 19% of sales, up from 18% for the same period last year, while direct finance took 50%, down from 51%, and sales finance 30%, down from 31%.

Geraldine Kilkelly, head of research and chief economist at the FLA, said: “The asset finance market reported a record level of monthly new business in March and the strongest quarterly growth in Q1 2019 since Q3 2016.
“Asset finance continued to support key sectors of the economy in the first quarter.”

March 2019 % change on

prev yr

3 mths to

March 2019

% change on

prev yr

12 mths to

March 2019

% change on

prev yr

Total FLA asset finance (£m) 3,679 +11 8,490 +11 33,447 +7
Total excluding high value (£m) 3,403 +7 7,861 +9 31,069 +5
By asset:
Plant and machinery finance (£m) 728 +11 1,861 +12 7,055 +8
Commercial vehicle finance (£m) 994 +17 2,231 +23 8,402 +14
IT equipment finance (£m) 211 +5 612 +18 2,808 +19
Business equipment finance (£m) 252 -1 623 +2 2,670 +5
Car finance (£m) 993 -3 2,209 +2 8,940 -3
Aircraft, ships and rolling stock finance (£m) 111 +238 147 +122 392 -12
By channel:
Direct finance (£m) 1,711 +5 3,926 +7 15,492 +4
Broker-introduced finance (£m) 658 +19 1,642 +19 6,354 +16
Sales finance (£m) 1,033 +3 2,293 +5 9,223 +1
By product:
Finance leasing (£m) 429 +6 1,040 +14 4,220 +11
Operating leasing (£m) 645 -10 1,447 -6 5,894 -9
 Lease/Hire purchase (£m) 2,006 +9 4,756 +15 18,769 +11
Other finance (£m) 439 +53 963 +24 3,240 +7

Written by John Maslen

Source: Asset Finance International

Marijana No Comments

UK asset finance market remains on track for record year

Growth in asset finance new business (primarily leasing and hire purchase) for the UK remained stable towards the end of last year as the industry prepared to make a record year.

New figures released by the Finance & Leasing Association (FLA) for November show that plant and machinery finance and business equipment finance sectors grew 9% and 8% respectively compared to the same period last year.

Overall growth was slowed because finance demand for business cars and IT equipment fell by 6% and 32% over the same period.

Geraldine Kilkelly, head of research and chief economist at the FLA, said: “The asset finance market’s performance in November means the industry remains on track to report a record level of new business in 2018 as a whole.

“The percentage of UK investment in machinery, equipment and purchased software financed by FLA members reached 32.2% in the twelve months to September 2018, a nine-year high.”

Source: Asset Finance International

Marijana No Comments

Brokers overcome uncertain economy to guide UK asset finance market towards record levels

Asset finance new business (primarily leasing and hire purchase) grew by 9% in October, compared with the same month last year, pushing the market closer to an all-time record, according to new analysis.

Latest figures from the Finance & Leasing Association (FLA) show that the plant and machinery finance and business equipment finance sectors had particularly strong new business growth, rising 16% and 29% respectively, compared with October 2017.

New finance for commercial vehicles increased by 23% over the same period.

For the 12 months to the end of October, asset finance demand has grown 9% compared to the previous 12 month period, or 3% excluding high-value items.

Growth has come almost entirely from broker-introduced finance, which was up 22% in October compared to the same period last year and 12% over the past 12 months.

Geraldine Kilkelly, head of research and chief economist at the FLA, said: “The asset finance market made a strong start to the final quarter of 2018, with new finance for construction and agricultural equipment up in October by 27% and 19% respectively, compared with the same month in 2017.

“Asset finance new business in 2018 as a whole is likely to reach a record level, despite continued economic uncertainty weighing on business investment.”

Source: Asset Finance International