Prospects for the equipment finance market in the early months of 2018 continue to look good, although the Equipment Leasing & Finance Foundation’s monthly index of prevailing business conditions and expectations has dipped slightly from the start of the year.
The February 2018 monthly confidence index for the equipment finance industry (MCI-EFI) stood at 73.2 in February, easing from 75.3 in January, which was an all-time high level for the benchmark.
When asked about the outlook for the future, MCI-EFI survey respondent Valerie Hayes Jester, president, Brandywine Capital Associates, said: “Our strong start to the year could be tempered with the recent volatility of the stock market and overall fears of rate increases.
“I believe by the end of the quarter we will have a strong picture regarding demand for the year. At this point, indications look favorable for continued positive trends in equipment acquisition and for financing for those transactions.”
The latest data shows 46.4% of executives responding said they believe business conditions will improve over the next four months, a decrease from 67.7% in January.
However, none believe business conditions will worsen, down from 3.2% who believed so the previous month.
The proportion expecting an increase in demand for leases and loans to fund capital expenditures over the next four months is largely unchanged at 67%.
David Normandin, managing director, commercial finance group, Hanmi Bank, said: “Tax reform and general market conditions have driven confidence levels very high.”
Michael Romanowski, president, Farm Credit Leasing Services, said: “We are actively talking with partners and customers regarding the impact of tax reform and how best to structure transactions to meet their business objectives and maximize the benefits of tax reform. We expect this year to be a transition year to the ‘new normal’."