(This January 24 article has been corrected in the second paragraph to say that cumulative borrowings have increased instead of borrowings.)
Reuters – Borrowing to finance capital expenditures by U.S. businesses rose 9% in December from a year earlier, according to industry group the Equipment Leasing and Financing Association (ELFA).
The two companies signed $12.9 billion in new loans, leases and lines of credit last month, according to ELFA. Cumulative borrowing has increased by 6% since January 2022.
Credit approvals totaled 76.6% in December, down from 77.7% in November, according to ELFA, which reports economic activity in the trillion-dollar equipment finance sector.
Chris Lerma, president of AP Equipment Financing, said: “Without fully grasping the economic impact of a series of rapid Fed rate hikes, many firms are focusing on credit quality, spreads and origination volumes. I think we’re starting the year,” he said.
Based in Washington, ELFA’s Leasing and Finance Index measures the volume of commercial equipment financed in the United States.
The index is based on a survey of 25 members, including affiliates and divisions of Bank of America, Caterpillar, Dell Technologies, Siemens, Canon and Volvo.
ELFA’s non-profit Equipment Leasing & Finance Foundation said the confidence index was 48.5 in January, up from 45.9 in December. A reading above 50 indicates a positive business outlook.
(Reporting by Priyamvada C, Bengaluru; Editing by Silpi Majumdar)