New figures released by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) grew by 1% in December 2019, and by 6% in 2019 to reach a record annual total of £35.7 billion.

In December, the IT equipment finance sector continued to report double-digit growth as new business increased by 10% compared with the same month in 2018.  By contrast, the commercial vehicle finance and plant and machinery finance sectors reported falls in new business of 2% and 22% respectively, over the same period.

In 2019 as a whole, the commercial vehicle finance and plant and machinery finance sectors reported the strongest growth rates, with new business up by 9% and 5% respectively, compared with 2018.

Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said “The asset finance industry reached a record level of new business in 2019, despite continued weakness in business investment.  Within the overall total, more than £20 billion went to SMEs to fund investment in machinery and equipment, 4% higher than in 2018.”

“Key industry sectors benefitted from using asset finance last year, with double-digit growth in new finance provided for construction and manufacturing equipment.”

Dec 2019

% change on prev. year

3 months to Dec

2019

% change on prev. year

12 months to Dec

2019

% change on prev. year

Total FLA asset finance (£m)

2,943

1

8,679

1

35,653

6

Total excluding high value (£m)

2,605

0

7,970

0

33,008

5

Data Extracts:

 

By asset:

Plant and machinery finance (£m)

530

-22

1,677

-9

7,320

5

Commercial vehicle finance (£m)

693

-2

2,186

-7

9,136

9

IT equipment finance (£m)

376

10

840

25

2,830

3

Business equipment finance (£m)

231

2

603

-9

2,465

-2

Car finance (£m)

754

8

2,382

4

9,998

4

Aircraft, ships and rolling stock finance (£m)

35

17

116

-5

566

88

 

By channel:

Direct finance (£m)

1,279

-5

3,987

-1

16,680

5

Broker-introduced finance (£m)

522

1

1,689

1

6,782

9

Sales finance (£m)

804

7

2,294

1

9,546

2

 

By product:

Finance leasing (£m)

339

-15

1,088

-8

4,378

3

Operating leasing (£m)

640

7

1,815

1

6,984

1

Lease/Hire purchase (£m)

1,458

-5

4,476

-4

19,305

6

Other finance (£m)

336

35

930

44

3,587

18