Bancherul - BANCI / ENGLISH / Financial Leasing industry in Romania as of end of March, 2011

Bucharest, July 6 , 2011

New financed volume in the financial leasing

In the first quarter of 2011, the ALB members financed assets amounting at 261.07 million of Euros (92%) while and the non-affiliated companies reached an estimated value of 23.5 million of Euros (8%) so that the total of the contracts signed by the ALB members and the non-affiliated companies in this period (based on the value of the financed new assets) amounted at 284.57 million of Euros. The granted financings covered various fields, namely 21% (60.2 million of Euros) the industrial equipment, 16% (45.5 million of Euro) the real estate field and 63% (178.87 million of euro) the transport field. The biggest market quota is registered by the banks’ subsidiaries companies, with 58% out of the total, followed by the captive companies with 23% and by the independent companies with 19%.

In the transport field, the evolution of the financings in the first quarter of 2011 indicates a constant weight related to the vehicle categories, namely: the cars have a 55% quota, the heavy commercial vehicles 31% and the light commercial vehicles cover 14% out of the total.

In the mentioned period for the equipment financing it is interesting to mention that the weight of the construction field is increasing from 15% to 17%, the agricultural segment from 10% to 20%, whereas the financing of the other economic sectors has still a weight relatively constant (15% medical care equipment, 4% food industry, 8% for equipment in the metallurgic industry, 4% wood processing industry, 4% IT and software equipment) as well as other sectors.

The crisis period between 2008 and 2011 indicates new trends in the real estate financing considering the weight of the real estate categories. An increasing from 23% to 45 % related to the industrial buildings, from 2% to 3% of land financing and from 0% to 2% of hotel financing. On the contrary, the financing of the retail outlet area decreased from 21% to 1%, the financings of the offices areas class A, B and C decreased from 50% to 16% and the financing of the residential building drop from 4% to 1%. A cause of this evolution is represented by the financings based on the “sale and lease back” contracts as solutions aiming to obtain necessary liquidities in the crisis period by the clients of the financial leasing contracts.
The corporate clients attracted the largest part (92%) of the total financings, followed by the retail (6%) and the public sector (2%). Despite the last years model and as a solution offered for the clients under crisis situation the most frequent period of the leasing contracts is 2-3 years (23%) and 4-5 years (23%), followed by over 5 years (21%), 3-4 years (20%), 1-2 years (8%) and 1 year (5%).

The value of the goods under a repossession procedure is of 7% out of the total portfolio of the ALB members. The average duration of the forced execution trial concerning the bad-paying clients refusing to return the goods is between 3 to 9 months based on the ALB’ s estimations.

“The evolution of the first quarter presents recovery signs of the financial leasing, namely the financings are re-oriented towards those Romanian economic sectors that proved to be solid and resisted during the financial crisis period. We therefore do hope that as of the end of 2011 we will have a 10-15% increasing of the volume of new financings based on financial leasing contracts as well as an amendment of the legal procedures concerning the recovery of the goods in case of the bad payers clients” declared the ALB president, Mrs. Antoaneta Curteanu, CEO of UniCredit Leasing Corporation IFN SA.

Based on the ALB and NBR statistics, ALB is representing 92% of the financial leasing market and 63% of the NBFI consumer credit total market in Romania.

ALB is member in the Board of Directors of the European Federation of the Leasing Companies Association – Leaseurope - and member of the Consumer Credit Federation in Europe – Eurofinas.

Leasing Council of ALB Romania
ADRIANA AHCIARLIU
ALB Secretary General