Currently, the disadvantage of co-financing via leasing system is the short period of the contract -two years at most, which actually represents the implementation stage of a project. ALB representatives asked the Agriculture Ministry to extend the contract period to include the monitoring period so that the ownership can be transferred at the end of this period.
The monitoring period takes up to four-five years, therefore, ALB Romania proposed that the ownership transfer take place 60 days before the end of the monitoring period.
NBFIs are ready to set the program in motion in March, but the Agriculture Ministry has yet to work on related procedures.
Leasing companies had participated in co-financing programs until 2009 when they were excluded.
Romania’s leasing market grew 7% last year, to EUR1.32 billion, driven by a 14% growth on the auto segment, to EUR1 billion, while equipment leasing declined 11%, to EUR282 million, ALB Romania data showed Thursday.
Automotive leasing grew 14% last year, to EUR1 billion, equipment leasing declined 11%, to EUR282 million, and real estate leasing declined 17%, to EUR42 million. Vehicle financing accounted for 76% of the total, five percentage points higher than in 2013, equipment accounted for 21%, and real estate for 3%.
ALB represents 89% of Romania’s financial leasing market.