U.S. business borrowing for equipment jumps about 9% in March- ELFA

April 22 (Reuters) – U.S. companies’ borrowings for capital investments rose about 9% in March from a year earlier, the Equipment Leasing and Finance Association (ELFA) said on Wednesday.

The companies signed up for $8.9 billion in new loans, leases and lines of credit last month, up from $8.2 billion a year earlier. Borrowings rose 31% from the previous month.

“During the first half of the month, economic activity and industry performance were strong, mirroring overall strength in the U.S. economy,” ELFA Chief Executive Officer Ralph Petta said.

“However, during the second half of March, as the coronavirus pandemic’s impact — both from a health and economic standpoint — entered the country’s consciousness, all that changed,” he added.

Washington-based ELFA, which reports economic activity for the nearly $1-trillion equipment finance sector, said credit approvals totaled 74.2% in March, down from 74.7%% in February.

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 Bank of America Corp, CIT Group Inc and the financing affiliates or units of Caterpillar Inc, Dell Technologies Inc, Siemens AG, Canon Inc and Volvo AB.

The Equipment Leasing and Finance Foundation, ELFA’s non-profit affiliate, reported monthly confidence index of 22.3 in April due to the impact of the pandemic, down from 46.0 in March.

A reading of above 50 indicates a positive business outlook. (Reporting by Ashwini Raj in Bengaluru; Editing by Maju Samuel)

Source: Read Full Article