Asset finance new business grew by 9% year-on-year to reach almost £8bn (€9.4bn) in Q1, according to the Finance and Leasing Association’s (FLA) results.
Direct finance was the most popular channel, increasing by 8% year-on-year to reach £3.82bn in the first quarter of this year.
Broker-introduced finance saw the largest percentage increase when compared to other channels, rising 25% to £1.47bn, while sales finance rose 6% to £2.35bn over the same period.
Lease and hire purchase was the most popular product in Q1, reaching £4.15bn, increasing by 14% on last year’s figure. Operating leasing rose by 10% to £1.78bn in the first quarter of 2017, and finance leasing increased slightly, up 1% from last year’s figure to £933m.
Other finance experienced a decline, down 3% year-on-year in Q1 2017 to £1.12bn. This follows the 30% year-on-year fall other finance experienced in March 2017 alone.
By asset, aircraft, ships, and rolling stock finance saw the greatest increase, more than doubling to £168m in Q1, while plant and machinery finance recorded a 20% increase to £1.7bn over the same period.
Geraldine Kilkelly, head of research and chief economist at the FLA, said: “The strong growth in asset finance new business in the first quarter of 2017 was above expectations, and reflects the improved outlook for business investment reported by the Bank of England in its May 2017 Inflation Report.”