NEW YORK (Reuters) - A measure of business activity improved in June as companies borrowed more to replace equipment, a lender group said on Tuesday.
The Equipment Leasing and Finance Association (ELFA) said U.S. businesses originated $7.3 billion in loans, leases and lines of credit in June for investment in everything from industrial equipment to computer systems and office furniture,
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The figure was up 33 percent from a year earlier and up 30 percent from May. So far this year, new borrowings are up 28.5 percent from the year-earlier period.
ELFA, which reports economic activity for the $521 billion equipment finance sector, measures some of the same trends as the government's durable goods report and the Institute of Supply Management index, but it precedes them by a few days.
Confidence about the direction of the leasing industry is higher, according to the survey. The monthly confidence index rose almost 7 percent to 56.2.
ELFA Chief Executive William Sutton said although the number of transactions submitted for approval decreased during the month, the number of approvals shot up.
"We may have had a real increase in quality," Sutton said.
CREDIT QUALITY IMPROVES
The group, which represents the lenders that finance half of the capital investment in the United States each year, said 2.5 percent of borrowers were delinquent 30 days or more, down from 2.9 percent in May.
Credit approvals in June increased to 79 percent from 76 percent in May.
ELFA members include Bank of America Corp <BAC.N>, and financing affiliates or subsidiaries of Canon Inc <7751.T>, Caterpillar Inc <CAT.N>, Dell Inc <DELL.O>, Siemens AG <SIEGn.DE> and Verizon Communications Inc <VZ.N>, among others.
(Reporting by A. Ananthalakshmi; Editing by Steve Orlofsky)