Raiffeisen Leasing expects the leasing market to rise by 30% in 2008, with car, equipment and real estate financing to be the most dynamic segments this year.
Estimated at 4.2bn euros in 2007, the financial leasing market will see further growth in 2008, but its advance could slow down due to rising inflation, macroeconomic deficits, and the higher interest rate.
"This will be a challenging year not only for the financial leasing industry, but for the overall national economy. Besides the higher benchmark rate, widening inflation and the current account deficit will have an impact on financial leasing in 2008. I believe a 20-30% market advance can be achieved this year, with lower growth on the car segment and higher growth on the equipment and real estate segments," says Mihaela Mateescu, Raiffeisen Leasing chairman.
At present, companies that are part of major banking groups dominate the financial leasing market, led by UniCredit Leasing Corporation, BCR Leasing and Porsche Leasing.
With financed goods worth 261m euros, Raiffeisen Leasing is among the ten biggest players on the market, with a 6.2% market share.
"The domestic market may see mergers and acquisitions. While so far the number of such deals has been quite small, being largely the result of some mergers at the level of parent companies, I believe we may witness such deals this year," says Mateescu, adding that she does not rule out the arrival of some new players targeting certain market niches.
The company has an active portfolio worth 306m euros and 14,000 contracts in progress, while its customers are mainly legal entities, such as SMEs, multinationals and municipalities. Individuals account for less than 2% in the company's portfolio, while around 15% are customers from the parent group.
Raiffeisen Leasing's biggest customer is Continental hotel chain, with which the company is set to sign a sale &lease back contract worth around 10m euros, by the end of the first quarter.
In 2007, the financing granted for the acquisition of commercial vehicles accounted for the largest volume in the company's portfolio, namely 74%, while equipment leasing came second with 17%.
The minimum value of an equipment-financing contract stands at 20,000 euros, with the average value standing at 50,000 euros. The increase in the value of released financing depends not just on companies' retooling needs, but also on customers' repayment capacity, believes Mateescu.
"Equipment leasing will be one of the most dynamic market segments in the coming years, followed by real estate financing," she adds.
Set up in 2002, the company has branches in 16 cities and plans to double personnel in territorial branches.
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