New leasing business in Europe grew by 9.4% in the second quarter of 2015 compared to the same period last year, according to Leaseurope’s quarterly survey.
The eighteenth edition of the survey featured a larger sample, as the number of firms which participated increased from 17 to 23.
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The survey showed that new business volumes stood at 23.7bn in Q2 2015, up from 21.7bn in Q2 2014.
The portfolio of outstanding contracts declined by 1.3% year-on-year, while risk-weighted assets increased by 2.4%. This was the first time in three years that the risk-weighted assets increased. According to Leaseurope the increase reflected an "increasingly stringent regulatory environment."
Total pre-tax profit increased by 52.7% for the 23 respondents in Q2 2015 compared to the same period in 2014, reaching 1.16bn.
The average profitability ratio also increased from 37.8% in Q2 2014 to 45.5% in Q2 2015 in the same period, the highest on record in the survey’s history.
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By GlobalDataCompared to the same period a year ago, operating income increased (8%), while operating expenses increased by a lesser amount (3.7%). This resulted in a further improvement of the average cost/income ratio in Q2 2015 to 43.6%, which was the lowest level of this indicator ever recorded by the Index.
Loan loss provisions decreased "substantially" in Q2 2015 compared to the same period of the previous year, the survey reported a 30.6% fall. This development led to the average annualised cost of risk declining in Q2 2015 to another record setting low for the Index of 0.5%.
Return on assets (RoA) and return on equity (RoE) both increased significantly in Q2 2015 compared to Q2 2014, reaching 2.0% and 227 respectively. This is the first time in the index that the RoA figure has breached the 2% level, while the gains made in RoE are even more impressive, improving a lot on the already high level seen in Q1 2015.
Enrico Duranti, chief executive officer of Iccrea BancaImpresa and chairman of Leaseurope, said: "Looking at the Q2 2015 results, I see that our industry is starting to return to pre-crisis level KPIs. After many difficult years, to see such strong performance across the board, from profitability to cost of risk, is extremely encouraging and cements our position as a reliable and important form of finance for the European economy. One area of risk going forward could be weak portfolio growth, particularly in light of increasingly tight regulatory requirements. However, as new business growth remains strong and domestic demand continues to firm, I expect continued good performance for the leasing business over the second half of the year."
