Raiffeisen Leasing to double growth in 2006

Raiffeisen Leasing, a member of the Raiffeisen group, estimates it will double the growth in its financing in 2006, as a result of introducing new products and an increased importance of equipment leasing as a proportion of total financing. For this year the company is expecting contracts with a total value of 130-135 million euros, 10-15% more than last year. For 2006, Raiffeisen Leasing is looking to a 22-27% surge in financing volumes to 165 million euros.

“Next year we will increase financing for equipment and real estate leasing, since we don”t think the car market will see the same growth as in 2005. By the end of the year, we will add real estate leasing to our portfolio, aimed at big industrial projects and office buildings,” said Mihaela Mateescu, the company”s marketing manager.

In the first nine months of the year the company sealed 5,500 contracts worth 95 million euros. Of this value, 83% represents car financing, with the remaining 17% destined to equipment leasing contracts.

“One of the reasons equipment leasing is not very well developed in Romania is the lack of a secondary market for equipment,” says Mateescu. “On the other hand, most leasing firms are reluctant to grant financing because the risk calculation procedure is much more complex and takes into account a high number of factors – from analysis of the business plan, to the liquidity of the goods at the moment the contract is signed.”

In 2006, the company plans to boost equipment leasing to 20% of its total financing.

The average duration of contracts in the company”s portfolio is 38-42 months, while in the car segment there is a tendency to extend this to 5 years, says the Raiffeisen Leasing representative.

The company does not include any operational leasing products in its portfolio, since it only operates in the domain of financial leasing. The company mainly secures financing from Raiffeisen Bank.

marius.anton@zf.ro