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Maybe the economy isn't as soft as it seems. New business volume in the equipment finance sector in May increased 6.5 percent compared with May 2007's total, according to the Equipment Leasing and Finance Association's (ELFA) monthly leasing and finance index.
 
The index factors in economic activity for the $650 billion equipment finance market, reflects the levels of equipment financed and complements other relevant economic indices, ELFA said.
 
May originations remained flat vs. April, stabilizing at $7.2 billion. But receivables in the less-than-30-day category reached 97 percent in May, up slightly from April's level. Credit approval ratios (at 76.2 percent) increased 2.3 percent compared with April's total.
 
"Those expecting to see evidence of an overall slowdown in commercial equipment finance activity ... as a result of the mortgage crisis, rising energy and food prices or a general economic slowdown may be surprised by this report," said William Verhelle, chief executive officer of index participant First American Equipment Finance, in a prepared statement. "Only in specific segments, such as trucking, real estate and among some small businesses, is there evidence of significant increased delinquencies and reduced new equipment financing activity."
 
Businesses are financing more capital equipment acquisitions to preserve cash, thereby accounting for a continued strong level of equipment loan originations, he said.