Asset finance
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Asset finance new business reached record levels in 2017 following growth of 5% during the year, according to the latest figures from the UK’s Finance & Leasing Association (FLA).

The sector achieved its seventh consecutive year of growth, with new business levels reaching almost £32 billion last year.

The plant and machinery finance and commercial vehicle finance sectors reported new business up in 2017 by 12% and 1% respectively, compared with 2016, while new finance for business equipment was up by 7% over the same period.

Geraldine Kilkelly, head of research and chief economist at the FLA, said: “The asset finance industry reported a record level of new business of almost £32 billion in 2017, despite challenging economic conditions and subdued business investment growth.

“The latest figures also reveal that asset finance is a vital source of funding for SMEs when investing in business equipment and machinery. Of the total asset finance new business in 2017, £18.6 billion went to SMEs – 12% higher than in 2016.”

During 2017, FLA members provided £128 billion of new finance to UK businesses and households, with £32 billion of finance provided to businesses and the public sector.

FLA members financed more than one-third of UK investment in machinery, equipment and purchased software in the UK last year.

UK asset finance market 2017

Dec17 % change on

prev yr

3 mths to

Dec 17

% change on

prev yr

12 mths to

Dec 17

% change on

prev yr

Total FLA asset finance (£m) 2,632 +4 +4 7,861 31,769 +5
Total excluding high value (£m) 2,483 -1  -1 7,695 30,752 +6
By asset:
Plant and machinery finance (£m) 512 +1 1,515 +5 6,617 +12
Commercial vehicle finance (£m) 572 -14 1,934 -1 7,480 +1
IT equipment finance (£m) 293 +19 726 +14 2,285 +2
Business equipment finance (£m) 227 +6 624 +6 2,581 +7
Car finance (£m) 629 -2 243 +4 9,531 +5
Aircraft, ships and rolling stock finance (£m) 36 -41 60 -50 549 +20
By channel:
Direct finance (£m) 1,153  -7  3,746  0  15,477  +4
Broker-introduced finance (£m) 579 +24 1,620 +21 5,839  +14
Sales finance (£m) 752 -8 2,329 +4 9,436 +7
By product:
Finance leasing (£m) 403 +1 1,022 +5 3,809 +6
Operating leasing (£m) 511  -12 1,624 -4 6,755  0
Lease/Hire purchase (£m) 1,225 +1 4,162 +5 16,924 +8
Other finance (£m) 1,053 +19 1,053 +19 4,281 +5

Source: Asset Finance International

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