Regional equipment financiers face new capital challenges

Regional equipment finance companies are once again feeling pressures wrought by tightened credit markets and increased regulation following Silicon Valley Bank’s collapse last March.  

New York Community Bank’s ongoing capital requirement woes and a deteriorating commercial real estate portfolio rattled investors this morning, causing the KBW Nasdaq Regional Banking Index to drop by as much as 2.5% in the early hours of trading today to $94.34. NYCB acquired equipment financier Signature Financial  last March in a $2.5 billion transaction. 

The index, comprised of 50 components, including NYCB, was down 0.13% to $96.47 as of market close today, but has slid more than 20% since March 2023. 

The five other regional banks with equipment finance operations listed in the index are:  

First Commonwealth Financial Corp. 

• Headquarters: Indiana, Pa.  
• Services: First Commonwealth finances a range of equipment, including trucks, construction and machining equipment, medical equipment, farm tools and general office equipment.  
• Stock: After dropping 0.46% at market open today, First Commonwealth’s stock [NYSE: FCF]  was down 0.83% to $13.19 per share at publication time. The stock has dropped 11% in the last month. 

Atlantic Union Equipment Finance  

• Headquarters: Richmond, Va. 
• Services: Atlantic Union finances specialty vehicles, manufacturing equipment, construction and industrial equipment, corporate aircraft, rail cars, buses, trucks and trailers.  
• Total assets: $834 million as of year-end 2022, according to Monitor 100. 
• Stock: Following a 2.6% drop at market open, Atlantic Union’s stock [NYSE: AUB] was up 0.51% to $33.36 at publication. The stock has dropped 1.39% in the last month.  

Eastern Funding  

• Headquarters: Boston 
• Services: Eastern Funding lends to small and medium-sized businesses nationwide and provides startup capital, equipment loans and commercial real estate financing.  
• Total assets: The financier was the 50th– largest equipment lender in 2022 with $1.3 billion of managed assets, according to the Monitor 100.   
• Stock: Parent company Brookline Bancorp’s [Nasdaq: BRKL] stock hit a low point shortly after market open today, down 3.6%, but leveled out slightly. At publication, it was down 1% to $9.84 per share. The stock is down 7.5% in the last month.  

Frost Equipment Leasing & Finance 

• Headquarters: San Antonio 
• Services: Frost Equipment Leasing and Finance finances computers, medical equipment, construction and manufacturing machinery . It services loans of $50,000 or more, according to its website.  
• Total assets: The lender has less than $308.3 million in managed assets, according to the Monitor 100. In 2021, it ranked as the 66th– largest equipment financier by managed assets.  
• Stock: Parent Cullen/Frost’s stock [Nasdaq: CFR] was down 1.7% this morning after market open. At publication, it was down .29% to $101.21 per share. In the last month, the stock is up 3.6%.  

Hancock Whitney Equipment Finance  

• Headquarters: New Orleans  
• Services: Hancock Whitney provides financing for equipment, including aircraft, transportation, work boats and municipal leases.
  Total assets: $1.7 billion  
• New business volume: $708 million  
• Stock:  Hancock Whitney’s stock [Nasdaq: HWC] hit a low point after market open today, down 2.9%. At publication, the stock was up 1.28% to $42.60 per share. In the last month, Hancock Whitney’s stock is down 8.6%.  

Registration is now available for Equipment Finance Connect. The dealer-centric equipment lending and leasing event of the year offers opportunities for dealers to learn new strategies, foster valuable partnerships and emerge with ideas to immediately apply to their businesses. Learn about free dealer registration at EquipmentFinanceConnect.com.