Monthly Confidence Index Shows Slight Increase
Posted 06/30/09
The Foundation recently launched a new Monthly Confidence Index for Equipment Finance industry (MCI-EFI). Debuting in May, the Index was developed to give a quick, one-number look at the equipment finance sector’s confidence in business, helping industry outsiders gain greater understanding of the sector and its dynamics. The May 2009 Index showed a confidence rating of 49.20 on a 100 point scale. The June 2009 Index rating increased slightly with a score of 51.8, showing that perhaps a light at the end of the tunnel exists.
Just over 68 percent of respondents also responded that their business conditions will remain the same over the next four months, an increase from the 44.7 percent that agreed with this consistency in May. Also, 26.3 percent believe business conditions will get better over the same time period versus 36.2 percent for May 2009.The June index also showed that a full 50 percent of survey respondents believe the U.S. economy will get better over the next six months, compared to 44.7 percent from May 2009.
Elaine Temple, President, BancorpSouth Equipment Finance, said, on the middle market segment, “I am confident that the industry will continue to play a vital role in the economy. The industry will continue to have difficulty with existing workout loans but overall the industry will thrive and provide much needed services to our clients.”
From the small ticket market, Dave Schaefer, President, Orion First Financial, LLC said, “I feel positive about the long-term but we must focus on getting through the here and now. Portfolio performance is still stressed, demand for equipment financing is off 50 to 75 percent and access to capital is restricted.”
The MCI-EFI uses the same pool of 50 organization leaders to respond monthly to ensure the survey's integrity, and the results provide a complementary data point to ELFA’s Monthly Leasing and Finance Index (MLFI-25). Each month, a new index rating will be issued, and is expected to show a consistent barometer of the industry's overall confidence.
The MCI-EFI is posted on the Foundation’s website. To see the results and comments, please visit the website at www.leasefoundation.org.
