Financial leasing market records new funding worth EUR 664 M by end-H1, 2014


The Romanian financial leasing market recorded 664 million euros worth of overall newly-financed volume at the end of June 2014, up 22 percent from the same period a year ago, the Financial Companies Association – ALB Romania said in a release.

Funding directed to the segment of cars and commercial vehicles amounted to 503 million euros (76 percent), equipment funding totaled 139 million euros (21 percent) and the real estate 22 million euros (3 percent).

‘The 22 percent increase recorded by the financial leasing market in the first half of this year confirms our expectations as regards the opening and needs of our clients as far as the development of their business is concerned. It’s still very important for the leasing companies to provide their clients with financial solutions for a healthy and consistent growth. I still believe that the positive trend of the leasing market this year may reach the best growth dynamics in the last four years,’ ALB Chairman Felix Daniliuc said.

The funding of transportation means, higher by 3 percent compared to the same period of last year, shows a stable interest of transporters in using the financial leasing as funding source for renewing the motor vehicle fleet.

When compared to the similar period of 2013, there was an increase in the funding of agricultural equipment from 20 percent to 27 percent in H1, 2014, with a similar pattern in the funding of equipment for wood processing industry (5 percent up to 6 percent), food industry (4 to 5 percent) and medical equipment (3 to 5 percent).

Despite a very low increase, the real estate sector did not pass the 2012 and 2013 historic low, thus being in keeping with the general real estate market circumstances in Romania.

The companies accounted for the largest share (97 percent) of the overall funded clients, while the individuals held 3 percent and the public sector 1 percent, ALB Romania stressed.

The majority of the companies using the financial leasing as funding source for their acquisitions are the SMEs. The public-private partnership holds a share of only 1 percent, showing the lack of interest of the public authorities in this funding model for nationwide investment projects, ALB says.

As for the funding contract, the most common duration is of 4 to 5 years (30 percent), with the largest market share being held by the banks’ subsidiary financial leasing companies (65 percent), followed by the captive leasing companies (21 percent) and the independent financial leasing companies (14 percent).

 

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