Issue price - Newspaper Kommersant No. 50 (7495) dated 03/24/2023

Issue price - Newspaper Kommersant No. 50 (7495) dated 03/24/2023


One of the key trends in the leasing market last year was the growing concentration of new business on the largest lessors. The share of the top 10 companies in the volume of new business increased to an all-time high of 75%. Banking subsidiaries continue to pull the blanket over themselves, whose share in the new business has grown from 52% to 62%.

The departure of foreign businesses from Russia, which began to actively sell their leasing companies, also had a significant impact on the growth of market concentration. Basically, such transactions occur at a large discount to the real value of assets, which increases their attractiveness for potential investors. Such lessors are mainly owners of foreign property, which has risen in price significantly due to its shortage on the market.

Despite the fact that over the past year the volume of business of foreign companies has noticeably dipped, their value lies in a high-quality client base. Interest in companies is fueled by the systems of risk management and business processes built by them, as well as teams of specialists with good competencies and experience.

The negative effect of concentration risks can be clearly demonstrated on distressed assets concentrated mainly in companies with a corporate business model. Such players work with capital-intensive segments and, as a rule, have a high concentration of the portfolio on lessees - large corporate clients, and also demonstrate a high risk appetite in SMEs.

At the same time, big business today is subject to the negative influence of geopolitics, since it functions to a greater extent in the international space or is involved in the external economy. This put significant pressure on the financial performance of lessors. The share of overdue debt in net investment in leases (NIL) exceeded 20% in the first half of 2022, which led to the formation of significant reserves. An improvement in the financial condition of large lessees should not be expected in 2023 due to the protracted nature of the problems that their clients have formed.

At the same time, leasing companies with a retail and universal business model, specializing in working with highly liquid assets in the SME sector, showed more stable financial metrics. The share of CHILs with overdue debts of more than 90 days amounted to about 3% in the first half of 2022. At the same time, the return on equity of these models is maintained at a level of over 20%.

The increased shortage of new leasing items and, as a result, the growth of their cost stimulated clients to continue making payments under agreements. The advantages of retail lessors include the fact that the default of individual lessees does not have a significant impact on the financial condition of leasing companies due to the low concentration on customers and the high degree of equipment liquidity.

At the same time, the share of leasing companies with retail and universal business models in the market still exceeds 70% in the total volume of new business. Players with such business models will be able to continue to maintain the quality of the portfolio at an adequate level due to the presence of accumulated competencies in working in the SME segment, as well as a diversified leasing portfolio both by types of leased items and by lessees.

Zoya Sovetkina, Director for Ratings of Credit Institutions, Expert RA

Foreign participants surrender the market in favor of private companies

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