(Reuters) - U.S. companies’ borrowing to spend on capital investment rose 17 percent in November from a year earlier, the Equipment Leasing and Finance Association (ELFA) said.
Companies signed up for $7.5 billion in new loans, leases and lines of credit last month, up from $6.4 billion a year earlier. However, borrowing fell 11 percent from October.
“Despite a slight deterioration in credit quality, the industry appears poised to end the year on a high note,” ELFA Chief Executive Ralph Petta said.
“Time will tell if conditions favorable to business investment will remain in place in the coming year. We think so. Members typically look forward to a strong closing month and December looks to be no exception,” Petta said.
Washington-based ELFA, a trade association that reports economic activity for the $1 trillion equipment finance sector, said credit approvals totaled 73.6 percent in November, down from 74.6 percent in October.
ELFA’s leasing and finance index measures the volume of commercial equipment financed in the United States. It is designed to complement the U.S. Commerce Department’s durable goods orders report, which it typically precedes by a few days.
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 for December was 69.4, up from 67 in November.
A reading of above 50 indicates a positive outlook.
Reporting by Sanjana Shivdas in Bengaluru; Editing by Maju Samuel