European leasing market - ALB
European leasing market - ALB
European leasing market - ALB
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A Look at the <strong>European</strong> Leasing &<br />
Consumer Credit Markets<br />
Richard Knubben<br />
Automotive Affairs Adviser<br />
<strong>ALB</strong> National Conference,<br />
Bucharest<br />
12 November 2009
Agenda<br />
About Leaseurope<br />
Leaseurope Work Streams<br />
Leasing Market Figures:<br />
- In the EU and beyond<br />
- <strong>European</strong> Leasing Market in 2008 & H1 2009<br />
About Eurofinas<br />
Eurofinas Work Streams<br />
Consumer Credit Lending:<br />
- In the EU and beyond<br />
- <strong>European</strong> CC Market in 2008 & H1 2009
About Leaseurope<br />
The voice of <strong>leasing</strong> and automotive<br />
rental in Europe<br />
It brings together 47 Member<br />
Associations<br />
In turn representing more than 2 000<br />
finance <strong>leasing</strong> firms & more than 1 100<br />
short term rental companies<br />
Leaseurope represents ~95%of the<br />
<strong>European</strong> <strong>leasing</strong> <strong>market</strong><br />
Leaseurope members
Leaseurope Work Streams<br />
Prudential supervision – focus on <strong>leasing</strong> specific issues<br />
¬ CRD Review<br />
• In particular, technical amendments to the CRD<br />
¬ Forthcoming issues<br />
• Changes to the <strong>European</strong> financial supervision system<br />
• Monitoring of any initiatives in the field of non-credit institutions<br />
providing mortgage credit<br />
Taxation<br />
¬ VAT for financial services<br />
Legal<br />
¬ Anti-Money Laundering<br />
¬ Insurance mediation directive<br />
¬ Credit intermediation<br />
¬ CCD and <strong>leasing</strong><br />
¬ Product tying
Automotive issues<br />
Leaseurope Work Streams<br />
¬ Block exemption regulation<br />
¬ Cross border restrictions on car rental<br />
¬ Scrappage schemes<br />
¬ Vehicle re<strong>market</strong>ing<br />
¬ Environmental concerns<br />
Other issues<br />
¬ Debtors’ assets transparency<br />
¬ Leasing by the public sector<br />
<strong>European</strong> level <strong>market</strong> data<br />
¬ Annual survey of <strong>European</strong> <strong>leasing</strong><br />
¬ Ranking of top <strong>European</strong> <strong>leasing</strong> firms
Lease accounting<br />
Leaseurope Work Streams<br />
¬ IASB/FASB are proposing a new lease accounting model -<br />
right of use approach (final standard – Q2 2011)<br />
• Lessees will be required to recognise all leases on their balance<br />
sheets<br />
• The current finance/operating lease distinction will no longer exist<br />
• The new rules will require complex assessments regarding the<br />
lessee’s most likely lease term, contingent rental and residual value<br />
guarantee payments<br />
¬ The Discussion Paper published in March 2009 did not<br />
address lessor accounting<br />
• However, the Boards are working on a performance obligation<br />
approach to lessor accounting<br />
• They have yet to confirm whether lessor accounting will be in an<br />
exposure draft standard (Q2 2010)
Leaseurope Work Streams<br />
Lease accounting<br />
¬ Leaseurope has been instrumental in encouraging<br />
stakeholder reactions<br />
• The Boards have received 300 comment letters<br />
¬ Our own response focused on the unnecessary<br />
complexity of the new proposals:<br />
• IASB/FASB have to conduct a cost/benefit analysis<br />
• The new approach should be proportionate not<br />
overshadow the true economic benefits of the product<br />
• Leaseurope has also raised due process issues<br />
regarding lessor accounting with the governing body of<br />
the IASB
Global Leasing Markets in 2008<br />
Leaseurope<br />
US<br />
ELFA<br />
138 bil€<br />
Brazil<br />
ABEL<br />
11 bil€<br />
330 bil€<br />
of which<br />
equipment &<br />
vehicles:<br />
294 bil€<br />
Japan<br />
Australia<br />
AELA<br />
23 bil€<br />
JLA<br />
42 bil€<br />
New equipment <strong>leasing</strong> volumes; ELFA figures do not include passenger car <strong>leasing</strong><br />
Source: Leaseurope 2008 Annual Survey, local <strong>leasing</strong> associations, Leaseurope estimates
<strong>European</strong> Leasing Market Evolution<br />
<strong>European</strong> <strong>leasing</strong> <strong>market</strong> - new volume growth<br />
(% YoY)<br />
25%<br />
15%<br />
5%<br />
-5%<br />
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008<br />
-2.4%<br />
-5.0%<br />
-15%<br />
-21.6%<br />
-25%<br />
Total volumes Real Estate Equipment (incl vehicles)<br />
€330.1 bil €36.1 bil €293.9 bil<br />
Growth rates are calculated based on a homogenous sample of members reporting<br />
from year to year & are not adjusted for exchange rate fluctuations<br />
Source: Leaseurope Annual Surveys<br />
New<br />
volumes<br />
2008
<strong>European</strong> Leasing Penetration<br />
Leaseurope penetration rate (1999-2008)<br />
25%<br />
20%<br />
15%<br />
20.9%<br />
14.4%<br />
10%<br />
5%<br />
2.0%<br />
0%<br />
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008<br />
Total Equipment (incl vehicles) Real estate<br />
2008 penetration<br />
for the 30<br />
members in 23<br />
countries for<br />
which data was<br />
available<br />
PR are based on a homogenous sample of members reporting in Leaseurope’s<br />
Annual Statistical Enquiries, Eurostat
Performance of <strong>European</strong> Leasing Markets<br />
New volume growth per region in 2008<br />
(%YoY)<br />
-25.0% -15.0% -5.0% 5.0% 15.0% 25.0% 35.0% 45.0% 55.0%<br />
Nordic<br />
07-08<br />
2.4%<br />
11.4%<br />
06-07<br />
CEE<br />
12.2%<br />
50.1%<br />
AT, CH, Benelux<br />
4.7%<br />
14.3%<br />
Med<br />
-23.8%<br />
16.7%<br />
IT<br />
-18.5%<br />
1.6%<br />
FR<br />
3.6%<br />
10.2%<br />
UK<br />
-15.2%<br />
3.6%<br />
DE<br />
6.4%<br />
1.8%<br />
Growth rates are calculated based on a homogenous sample of members reporting from<br />
year to year & are not adjusted for exchange rate fluctuations<br />
Source: Leaseurope 2008 & 2007 Annual Surveys
<strong>European</strong> Leasing Market in H1 2009<br />
Growth<br />
H1’09/H1’08<br />
-36%<br />
UK €17 bn<br />
DE €20 bn<br />
IT €13 bn<br />
FR €13 bn<br />
-39%<br />
-23%<br />
-57%<br />
-52%<br />
ES €4 bn<br />
PL €2 bn<br />
CZ €0.8 bn<br />
-57%<br />
-25%<br />
-41%<br />
Source: Leaseurope’s member associations data
<strong>European</strong> Leasing Market in H1 2009<br />
Growth<br />
H1’09/H1’08<br />
UK €17 bn<br />
DE €20 bn<br />
IT €13 bn<br />
FR €13 bn<br />
ES €4 bn<br />
PL €2 bn<br />
CZ €0.8 bn<br />
Source: Leaseurope’s member associations data<br />
Adjusted for exchange rate fluctuations:<br />
-33%<br />
-57%<br />
-30%<br />
-25%<br />
-23%<br />
-41%<br />
-54%<br />
-38%
<strong>European</strong> Leasing Market: CEE<br />
Growth of new <strong>leasing</strong><br />
volumes H1 2009<br />
> 10 %<br />
0 - 10 %<br />
- 10 - 0 %<br />
< - 10 %<br />
GDP growth<br />
> 5 – 10%<br />
0% – 5%<br />
-5% – 0%<br />
< -5 %<br />
CEE cluster: 12.2%<br />
On average, CEE<br />
<strong>leasing</strong> still performs<br />
well in 2008<br />
26%<br />
-22%<br />
-42%<br />
9%<br />
-2%<br />
41%<br />
15%<br />
19%<br />
-2% 23%<br />
59%<br />
Source: Leaseurope and Eurostat
<strong>European</strong> Leasing Market: CEE<br />
Growth of new <strong>leasing</strong><br />
volumes H1 2009<br />
> 10 %<br />
0 - 10 %<br />
- 10 - 0 %<br />
< - 10 %<br />
-75%<br />
-65%<br />
GDP growth<br />
> 5 – 10%<br />
0% – 5%<br />
2009 outlook for<br />
CEE is very different<br />
-54%<br />
-38%<br />
-42%<br />
-70%<br />
-70%<br />
-76%<br />
-74%<br />
-5% – 0%<br />
-2%<br />
< -5 %<br />
-74%<br />
Source: country estimates, national <strong>leasing</strong> associations and Eurostat,<br />
ING Lease calculations; adjusted for currency fluctuations
<strong>European</strong> Leasing Market Growth<br />
<strong>European</strong> new <strong>leasing</strong> volumes per asset type in 2008 (% YoY)<br />
Machinery ICT CVs Cars Big/other<br />
5%<br />
5%<br />
Total<br />
Real estate<br />
5%<br />
Movables*<br />
0%<br />
-5%<br />
+5%<br />
-2%<br />
-2%<br />
0%<br />
-5%<br />
-10%<br />
-5%<br />
0%<br />
-5%<br />
-10%<br />
-2%<br />
-10%<br />
-15%<br />
-20%<br />
-11%<br />
-11%<br />
-15%<br />
-15%<br />
-25%<br />
-20%<br />
-25%<br />
-20%<br />
-25%<br />
-22%<br />
* Decline of -1% if big/other excluded<br />
Automotive assets<br />
represent more than<br />
50% of all new leases<br />
Annual growth rates calculated based on a homogenous sample of members reporting<br />
in the previous year
<strong>European</strong> Car Leasing & Rental Market<br />
Cars purchased or financed by Leaseurope members in 2008<br />
# (mil)<br />
€ (bil)<br />
Cars financed/purchased<br />
Leasing ST Rental<br />
6.04<br />
0.98<br />
116.94<br />
20.14<br />
Portfolio/fleet<br />
Leasing ST Rental<br />
Total<br />
7.02<br />
137.08<br />
Total<br />
# (mil)<br />
16.05<br />
0.78<br />
16.83<br />
€ (bil)<br />
239.30<br />
NA<br />
NA<br />
Source: Leaseurope estimates based on data collected in its 2008 Annual Survey
Forecast 2009<br />
Following extremely weak H1, new volumes in Europe will be<br />
significantly lower in 2009<br />
Bil €<br />
400<br />
350<br />
300<br />
250<br />
200<br />
150<br />
100<br />
50<br />
20%<br />
15%<br />
10%<br />
5%<br />
0%<br />
-5%<br />
-10%<br />
-15%<br />
0<br />
2002 2003 2004 2005 2006 2007 2008 2009f<br />
-20%<br />
New volumes<br />
Annual growth<br />
Source: New volumes reported in Leaseurope Annual Enquiries; Leaseurope estimate<br />
based on H1 2009 data provided by main <strong>European</strong> <strong>market</strong>s
<strong>European</strong> Consumer Credit Market
About Eurofinas<br />
The voice of specialised consumer<br />
credit providers at <strong>European</strong> level<br />
It currently represents 17 Member<br />
Associations<br />
In turn bringing together more than<br />
1,000 finance and credit institutions<br />
Employing over 80,000 people<br />
Eurofinas members
Eurofinas Work Streams<br />
<br />
Eurofinas Working Priorities<br />
<br />
<br />
<br />
<br />
Responsible Lending and Borrowing<br />
Consumer Credit Directive<br />
Credit Standardisation & Disclosure<br />
Consumer Rights<br />
<br />
Other Initiatives of Interests<br />
Unfair Commercial Practices – Misleading Advertising – Distance Marketing<br />
Unfair Contractual Terms – Data Protection – Redress - Scoring<br />
Standardisation<br />
Alternative Dispute Resolution – Insurance Mediation –<br />
Financial Education – Scoring Transparency<br />
Interest Rates Restrictions – Anti-Money Laundering – Financial Inclusion –<br />
<strong>European</strong> Level Market Data
Eurofinas Market Evolution<br />
Total Eurofinas lending – period on period growth rates<br />
10,00%<br />
Adjusted for exchange<br />
rate fluctuations<br />
5,00%<br />
0,00%<br />
déc-<br />
-5,00% 02<br />
-10,00%<br />
-15,00%<br />
-20,00%<br />
juin-<br />
03<br />
déc-<br />
03<br />
juin-<br />
04<br />
déc-<br />
04<br />
juin-<br />
05<br />
déc-<br />
05<br />
juin-<br />
06<br />
déc-<br />
06<br />
juin-<br />
07<br />
déc-<br />
07<br />
juin-<br />
08<br />
-10.1%<br />
-0.3%<br />
Xx<br />
déc- juin-<br />
08 09<br />
Xx<br />
Xx<br />
xx<br />
-2.7%<br />
-19.1%<br />
0.6%<br />
-15.6%<br />
Outstanding<br />
New Credit<br />
Includes mortgage lending and industrial credit<br />
Growth rates for new credit compare the first 6 months of the year for<br />
biannual figures, all other growth rates are annual growth rates<br />
Source: Eurofinas Annual & Biannual Surveys
Eurofinas Market<br />
Mil €<br />
400 000<br />
350 000<br />
300 000<br />
250 000<br />
200 000<br />
150 000<br />
100 000<br />
50 000<br />
0<br />
Total new credit<br />
415 Bil €<br />
205 769<br />
115 366<br />
-10.1%<br />
373 Bil €<br />
192 534<br />
101 922<br />
36 740 31 169<br />
57 079 47 471<br />
2007 2008<br />
Total new consumer credit by<br />
product type (2008)<br />
16%<br />
9%<br />
268 Bil €<br />
11%<br />
1%<br />
38%<br />
25%<br />
Mortgages<br />
Vehicle finance<br />
Industrial credit<br />
CC for pers consumption<br />
Personal loans<br />
Non-auto Pos<br />
Used car finance PoS<br />
Revolving<br />
New car finance Pos<br />
Other vehicle PoS<br />
Source: Eurofinas 2008 Annual Survey
Eurofinas New Consumer Credit Lending<br />
New consumer credit lending & <strong>market</strong> share per Eurofinas<br />
member in 2008<br />
120 000<br />
120%<br />
Mill of €<br />
100 000<br />
80 000<br />
60 000<br />
40 000<br />
20 000<br />
40%<br />
51%<br />
95%<br />
37% 39%<br />
17%<br />
29%<br />
36%<br />
56%<br />
89%<br />
40%<br />
35%<br />
100%<br />
80%<br />
60%<br />
20%<br />
Eurofinas:<br />
43.7%<br />
0<br />
NO CZ SE PT NL FI BE DE ES FR IT GB<br />
0%<br />
Total consumer credit Total lending Local consumer credit <strong>market</strong> share<br />
Source: Eurofinas 2008 Annual Survey
Consumer Credit for Personal Consumption<br />
New credit – period on period<br />
growth rates<br />
New credit – annual growth<br />
per member (2008)<br />
13,00%<br />
8,00%<br />
60%<br />
40%<br />
3,00%<br />
-2,00% déc-<br />
03<br />
-7,00%<br />
juin-<br />
04<br />
déc-<br />
04<br />
juin-<br />
05<br />
déc-<br />
05<br />
juin-<br />
06<br />
déc-<br />
06<br />
juin-<br />
07<br />
déc-<br />
07<br />
juin-<br />
08<br />
-3%<br />
déc-<br />
08<br />
-4%<br />
20%<br />
0%<br />
-20%<br />
-40%<br />
NL CZ IT DE BE FI PT FR ES GB<br />
-12,00%<br />
Personal loans<br />
Non-auto PoS<br />
Revolving<br />
Overall<br />
-10%<br />
-60%<br />
Personal loans Revolving Non-auto PoS<br />
Growth rates for new credit compare the first 6 months of<br />
the year for biannual figures while they compare 12 months<br />
for annual figures<br />
Source: Eurofinas Annual & Biannual Surveys<br />
• DE & CZ only members to show growth<br />
in all 3 product categories<br />
• Decreases in UK (largest <strong>market</strong>)<br />
contribute significantly to overall Eurofinas<br />
decline
Consumer Credit for Personal Consumption<br />
New credit – period on period<br />
growth rates<br />
New credit – growth per member<br />
(H1 2009 vs H1 2008)<br />
15,00%<br />
10,00%<br />
60%<br />
40%<br />
5,00%<br />
0,00%<br />
-5,00%<br />
-10,00%<br />
-15,00%<br />
-20,00%<br />
déc- juin-<br />
-20%<br />
08 09<br />
déc-<br />
03<br />
juin-<br />
04<br />
déc-<br />
04<br />
juin-<br />
05<br />
Personal loans<br />
Non-auto PoS<br />
Revolving<br />
déc-<br />
05<br />
juin-<br />
06<br />
déc-<br />
06<br />
Overall<br />
juin-<br />
07<br />
déc-<br />
07<br />
-7.9%<br />
-13.4%<br />
-18.5%<br />
juin-<br />
08<br />
-13.8%<br />
-16.2%<br />
-19.8%<br />
20%<br />
0%<br />
-40%<br />
-60%<br />
-80%<br />
Adjusted for exchange rate fluctuations<br />
ES GB PT NO CZ SE FR BE FI IT<br />
Personal loans Revolving Non-auto PoS<br />
DE<br />
Growth rates for new credit compare the first 6 months of the year for biannual<br />
figures while they compare 12 months for annual figures<br />
Source: Eurofinas Annual & Biannual Surveys
Vehicle Finance<br />
Consumer car finance – new<br />
credit granted period on period<br />
growth<br />
Consumer car finance – annual<br />
growth per member (2008)<br />
12%<br />
100%<br />
7%<br />
80%<br />
60%<br />
2%<br />
40%<br />
-3% déc-<br />
03<br />
-8%<br />
-13%<br />
-18%<br />
juin-<br />
04<br />
déc-<br />
04<br />
juin-<br />
05<br />
déc-<br />
05<br />
juin-<br />
06<br />
déc-<br />
06<br />
juin-<br />
07<br />
déc-<br />
07<br />
juin-<br />
08<br />
-16%<br />
déc-<br />
08<br />
-8%<br />
20%<br />
0%<br />
-20%<br />
-40%<br />
-60%<br />
CZ FI SE PT NL BE FR NO DE IT GB ES<br />
New Cars<br />
Used Cars<br />
New Cars<br />
Used Cars<br />
Growth rates for new credit compare the first 6 months of<br />
the year for biannual figures while they compare 12<br />
months for annual figures<br />
Source: Eurofinas Annual & Biannual Surveys<br />
Approximately 74% of<br />
vehicle finance is to<br />
consumers
Vehicle Finance<br />
Consumer car finance – new<br />
credit granted period on period<br />
growth<br />
Consumer car finance –<br />
growth per member<br />
(H1 2009 vs H1 2008)<br />
12%<br />
60%<br />
7%<br />
40%<br />
2%<br />
-3%<br />
déc-<br />
03<br />
juin-<br />
04<br />
déc-<br />
04<br />
juin-<br />
05<br />
déc-<br />
05<br />
juin-<br />
06<br />
déc-<br />
06<br />
juin-<br />
07<br />
déc-<br />
07<br />
juin-<br />
08<br />
déc-<br />
08<br />
juin-<br />
09<br />
20%<br />
0%<br />
ES GB SE FI IT NO PT FR BE CZ<br />
-8%<br />
-13%<br />
-18%<br />
New Cars<br />
Used Cars<br />
-9.8%<br />
-13.9%<br />
-14.2%<br />
-20%<br />
-40%<br />
-16.1% -60%<br />
New Cars<br />
Used Cars<br />
DE<br />
Adjusted for exchange rate fluctuations<br />
Growth rates for new credit compare the first 6 months of the year for biannual<br />
figures while they compare 12 months for annual figures<br />
Source: Eurofinas Annual & Biannual Surveys
Consumer Credit Market in 2009<br />
Following the downward pressure in H1, new consumer credit<br />
volumes in Europe will be significantly lower in 2009<br />
However there are a few glimmers of hope: consumer confidence is slightly<br />
increasing, increased savings rates can be viewed as strong potential for future<br />
consumption<br />
Governmental support has been (unequally) available to<br />
encourage lending in an effort to boost investment & consumption<br />
Lending conditions have eased but lenders remain concerned<br />
about the economic outlook and creditworthiness<br />
At the same time, EU is launching its responsible lending initiative<br />
Currently unclear what this will entail but it should not impede<br />
lending to households at this crucial time
Leaseurope & Eurofinas Common Work<br />
Streams<br />
Collective Redress<br />
IMD<br />
Anti-discrimination<br />
Consumer Rights Directive<br />
Responsible Lending Initiative
Thank you...
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