December 20, 2016 / 8:14 PM / 2 years ago

U.S. business borrowing for equipment rises 5 percent in November: ELFA

U.S. dollar notes are seen in this November 7, 2016 picture illustration. . REUTERS/Dado Ruvic/Illustration/File Photo - RTX2V3PJ

(Reuters) - U.S. companies borrowing to spend on capital investments rose 5 percent in November, compared with a year earlier, the Equipment Leasing and Finance Association (ELFA) said.

Companies signed up for $6.4 billion in new loans, leases and lines of credit last month, the Washington-based trade group said on Tuesday. However, their borrowings were down 22 percent from October.

President-elect Donald Trump’s proposals to spend more on infrastructure, simplify regulations and reform the tax code could boost U.S. economic performance, ELFA Chief Executive Ralph Petta said in a statement.

Credit approvals for all applications submitted in November was 76 percent, compared with 77.3 percent in October, said ELFA, which reports economic activity for the $1 trillion equipment financing sector.

The trade group’s leasing and finance index measures the volume of commercial equipment financed in the United States. The index is designed to complement the U.S. Commerce Department’s durable goods orders report.

ELFA’s index is based on a survey of 25 members that include Bank of America Corp (BAC.N), BB&T Corp (BBT.N), CIT Group Inc (CIT.N) and the financing affiliates or subsidiaries of Caterpillar Inc (CAT.N), Deere & Co (DE.N), Verizon Communications Inc (VZ.N), Siemens AG (SIEGn.DE), Canon Inc (7751.T) and Volvo AB (VOLVb.ST).

The Equipment Leasing & Finance Foundation, ELFA’s non-profit affiliate, said its confidence index rose sharply to 67.5 in December from 54.6 in November.

The index is an indicator of the outlook for the equipment finance market, with a reading of above 50 suggesting a positive outlook.

Reporting by Radhika Rukmangadhan in Bengaluru

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