New figures released by the Finance & Leasing Association (FLA) show growth in asset finance new business (primarily leasing and hire purchase) of 12% in 2015 – the market’s second consecutive year of double-digit growth. The value of new business in December 2015 was up by 18% compared with the same month in 2014.
New finance for commercial vehicles grew by 42% in December, and by 14% in 2015 as a whole. Further strong growth was also reported by the IT equipment finance sector as new business grew by 23% in December and by 38% in 2015 overall project planning steps.
Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said:
“2015 was another strong year for the asset finance industry, with new business reaching its highest level since the onset of the financial crisis. Our latest industry confidence survey suggests growth in new business of up to 10% in 2016.
“The asset finance industry funded almost 32% of UK investment in machinery, equipment and purchased software in 2015.”
| Dec
2015 |
% change on prev. year | 3 months to Dec 2015 | % change on prev. year | 12 months to Dec 2015 | % change on prev. year | |
| Total FLA asset finance (£m) | 3,011 | +18 | 7,772 | +11 | 29,114 | +12 |
| Total excluding high value (£m) | 2,814 | +19 | 7,399 | +10 | 28,104 | +11 |
| By asset: | ||||||
| Plant and machinery finance (£m) | 633 | +11 | 1,488 | +6 | 5,815 | +7 |
| Commercial vehicle finance (£m) | 735 | +42 | 1,939 | +19 | 6,882 | +14 |
| IT equipment finance (£m) | 347 | +23 | 663 | +16 | 2,248 | +38 |
| Business equipment finance (£m) | 198 | +2 | 524 | -7 | 2,076 | -5 |
| Car finance (£m) | 705 | +6 | 2,217 | +7 | 8,934 | +11 |
| Aircraft, ships and rolling stock finance (£m) | 83 | +157 | 175 | +61 | 557 | +111 |
| By channel: | ||||||
| Direct finance (£m) | 1,456 | +19 | 3,784 | +11 | 14,102 | +14 |
| Broker-introduced finance (£m) | 480 | +19 | 1,349 | +10 | 5,024 | +9 |
| Sales finance (£m) | 878 | +18 | 2,266 | +8 | 8,978 | +9 |
| By product: | ||||||
| Finance leasing (£m) | 615 | +52 | 1,272 | +25 | 3,732 | +5 |
| Operating leasing (£m) | 615 | +20 | 1,745 | +10 | 6,659 | +11 |
| Lease/Hire purchase (£m) | 1,296 | +9 | 3,732 | +8 | 15,077 | +14 |
| Other finance (£m) | 484 | +9 | 1,025 | +5 | 3,646 | +13 |
Note to editors:
In 2015, FLA members provided £110 billion of new finance to UK businesses and households. £29 billion of finance was provided to businesses and the public sector. FLA members financed almost 32% of UK investment in machinery, equipment and purchased software in the UK in 2015.
Credit: fla.org.uk