U.S. business borrowing for equipment falls 6% in December - ELFA

Jan 25 (Reuters) - U.S. companies’ borrowings for capital investments fell about 6% in December from a year earlier, the Equipment Leasing and Finance Association (ELFA) said on Monday.

Companies signed up for $12.1 billion in new loans, leases and lines of credit last month, down from $12.9 billion a year earlier. Borrowings in December, however, rose 66% from the previous month.

ELFA Chief Executive Officer Ralph Petta said most equipment finance sector observers would consider a single-digit decline in year-over-year new business volume tolerable, given the optimism around new U.S. stimulus measures and COVID-19 vaccine distribution.

Washington-based ELFA, which reports economic activity for the nearly $1-trillion equipment finance sector, said credit approvals rose to 75.2% in December from 70.4% in November.

ELFA’s leasing and finance index measures the volume of commercial equipment financed in the United States.

The index is based on a survey of 25 members, including Bank of America Corp, CIT Group Inc and the financing affiliates or units of Caterpillar Inc, Dell Technologies Inc, Siemens AG, Canon Inc and Volvo AB.

The Equipment Leasing and Finance Foundation, ELFA’s non-profit affiliate, reported monthly confidence index of 59.6% in January, unchanged from December.

A reading of above 50 indicates a positive business outlook. (Reporting by Shreyasee Raj in Bengaluru; Editing by Ramakrishnan M.)