Equipment finance originations jump 17% YoY
Average delinquency rate dropped 40 basis points in June
Equipment finance originations picked up last month as data center development and rebounding demand for transportation assets outweighed macroeconomic pressures.
New business volume in the industry totaled $10.5 billion in June, rising 2.5% month over month and 17.2% year over year, according to the Equipment Leasing and Finance Association‘s CapEx Finance Index released today. That breaks a four-month streak of MoM declines.
Through midyear, new business volume increased 11.2% YoY and is projected to hit a record $129 billion in 2026.
The spike in originations last month came despite Middle East tensions, tariffs, high energy prices, growing consumer debt and concerns about potential interest rate hikes, Kyin Lok, chief executive of Dext Capital, stated in the report. He also is an ELFA board member.
“Even so, customer health remains steady, portfolio performance remains solid, and the booming stock market reflects continued economic confidence and resilience in a new reality where change is the only constant,” he said. “Over the next three to six months, we expect healthy equipment finance demand, led by accelerating AI data center investment and a gradual rebound in specialty transportation.”
The average credit approval rate in equipment finance rose 60 basis points MoM in June to 79.5%, according to the report. The average delinquency rate fell 40 basis points to 1.7%, while charge-offs ticked up 5 basis points to 0.54%.
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