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