UK asset finance grows by over a third in December 2013

UK Finance & Leasing Association (FLA) members report that asset finance new business grew by 34% in December 2013 to £2.2bn, the strongest monthly rate of growth for almost six years.

The commercial vehicle finance sector reported another “robust performance”, with new business up 74% compared with the same month in 2012 to £618m. Strong growth in the commercial vehicle finance market was in part the result of new EU emission rules for trucks registered after 31 December 2013.

The full year figures for 2013 show that new business for asset finance deals of up to £20m grew by 4%, making it the fourth consecutive year of growth in the sector. There were positive figures across the market, with growth of 14% in IT equipment finance and 9% in commercial vehicle finance, compared with 2012. Modest growth was also reported in business car finance, plant and machinery finance, and business equipment finance with increases of 1%, 4% and 1% respectively.

Geraldine Kilkelly, Head of Research and Chief Economist at the FLA said: “The asset finance market reported its highest level of new business for three years in December, suggesting the long-awaited recovery in business investment may well have begun.

“The recovery in the UK economy so far has been driven by the services sector and supported by almost £15bn of asset finance provided to businesses in that sector last year.”