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US business borrowing for equipment falls in February: ELFA
[WASHINGTON] Borrowing by US companies to spend on capital investment declined 2 per cent in February, trade association Equipment Leasing and Finance Association (ELFA) said.
Companies signed up for US$6.1 billion in new loans, leases and lines of credit last month, down from a year earlier but up 2 per cent from January, ELFA said.
Cumulative new business volume decreased 7 per cent compared with 2015, ELFA said.
"While February origination volume is virtually flat when compared to January and the year-earlier period, credit quality shows signs of deterioration, with delinquencies and charge-offs inching upward over the same time intervals," ELFA Chief Executive Ralph Petta said in a statement.
Credit approvals totaled 79.2 per cent in February, up from 78.0 per cent in January, said ELFA, a Washington-based trade association that reports economic activity for the US$1 trillion equipment finance sector.
ELFA's leasing and finance index measures the volume of commercial equipment financed in the United States. It is designed to complement the US Commerce Department's durable goods orders report, which it precedes by a few days.
The index is based on a survey of 25 members that include Bank of America Corp, BB&T Corp, CIT Group Inc and the financing affiliates or units of Caterpillar Inc , Deere & Co, Verizon Communications Inc, Siemens AG and Volvo AB.
The Equipment Leasing & Finance Foundation, ELFA's non-profit affiliate, said its confidence index is 51.6 for March, up from February's index of 48.3.
A reading of above 50 indicates a positive outlook.