By Scott Malone
BOSTON, March 22 (Reuters) - U.S. businesses cut back on borrowing to finance new investment in equipment in February, while the number of bad industrial loans rose slightly, according to a trade group for lenders.
The Equipment Leasing and Finance Association told Reuters the overall volume of financing to fund equipment purchases dropped to $3.2 billion in February, down 3 percent from the same month a year earlier and down 6 percent from January.
U.S. companies have been reducing the amount of money they borrow to finance capital spending since mid-2008, as a global economic downturn made them leery of taking on more debt and soft demand for many categories of merchandise left many companies reducing their production.
While down, February's 3 percent year-over-year decline was more moderate than the 24 percent drop recorded in January.
'We still have a long way to go in the economic recovery,' Thomas Jaschik, president of BB&T Equipment Finance and an ELFA member, said in a statement. 'Businesses continue to lack the confidence to make substantial investments in capital equipment.'
The percentage of charge-offs rose to 1.89 percent of financings in February from 1.68 percent in January.
ELFA, which provided the data to Reuters on Monday, said construction and trucking stood out as the weakest sectors.
ELFA's members finance half the capital equipment spending in the United States. They include Bank of America Corp , Canon Inc's Canon Financial Services, Caterpillar Inc's Caterpillar Financial Services Corp, CIT Group Inc, Dell Inc's Dell Financial Services, Deere & Co's John Deere Credit Corp, Siemens AG's Siemens Financial Services, and Verizon Communications Inc's Verizon Capital Corp.
More than half the money invested in plants, equipment and software in the United States in any given year is financed with loans, leases and lines of credit.
(Reporting by Scott Malone; editing by John Wallace) Keywords: ELFA/ (Boston.Newsroom@thomsonreuters.com; +1 617-856-4342; Reuters Messaging: scott.malone.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
BOSTON, March 22 (Reuters) - U.S. businesses cut back on borrowing to finance new investment in equipment in February, while the number of bad industrial loans rose slightly, according to a trade group for lenders.
The Equipment Leasing and Finance Association told Reuters the overall volume of financing to fund equipment purchases dropped to $3.2 billion in February, down 3 percent from the same month a year earlier and down 6 percent from January.
U.S. companies have been reducing the amount of money they borrow to finance capital spending since mid-2008, as a global economic downturn made them leery of taking on more debt and soft demand for many categories of merchandise left many companies reducing their production.
While down, February's 3 percent year-over-year decline was more moderate than the 24 percent drop recorded in January.
'We still have a long way to go in the economic recovery,' Thomas Jaschik, president of BB&T Equipment Finance and an ELFA member, said in a statement. 'Businesses continue to lack the confidence to make substantial investments in capital equipment.'
The percentage of charge-offs rose to 1.89 percent of financings in February from 1.68 percent in January.
ELFA, which provided the data to Reuters on Monday, said construction and trucking stood out as the weakest sectors.
ELFA's members finance half the capital equipment spending in the United States. They include Bank of America Corp , Canon Inc's Canon Financial Services, Caterpillar Inc's Caterpillar Financial Services Corp, CIT Group Inc, Dell Inc's Dell Financial Services, Deere & Co's John Deere Credit Corp, Siemens AG's Siemens Financial Services, and Verizon Communications Inc's Verizon Capital Corp.
More than half the money invested in plants, equipment and software in the United States in any given year is financed with loans, leases and lines of credit.
(Reporting by Scott Malone; editing by John Wallace) Keywords: ELFA/ (Boston.Newsroom@thomsonreuters.com; +1 617-856-4342; Reuters Messaging: scott.malone.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.