The company expects the number of vehicles repossessed from customers having trouble paying instalments to double compared with last year, which will lead to rising provisions.
Afin Leasing, the captive company of the importer of Iveco commercial vehicles and the fourth player on the leasing market, estimated its business would shrink to around a third against last year, with the projected value of financed goods standing at 80-100m euros, as the market was declining, stated Fabio Razzetto, a CEO with Afin Leasing.
In 2008, the company financed goods worth 307m euros, up from 110m euros in the previous year, with the increase standing at 179%. Of this sum, 217m euros account for commercial utility vehicle financing, while the rest of 90m euros are sums granted to Iveco dealers to finance their inventories.
"We're a captive company, meaning that our main target is to help promote Iveco brand, not just be profitable. Captive companies are increasingly more important in this period, amid customers' tight access to financing," Razzetto told ZF in an interview. Razzetto, 34, came at the helm of Afin Leasing in November 2007, after having joined Fiat Italian group Iveco is part of in 2002.
Afin last year ranked fourth, after not being among the top ten players in 2007. The company almost doubled its financing volume, to 410m euros. Starting the last months of 2008, leasing firms' portfolio quality started to deteriorate amid a rising number of customers having trouble in paying their instalments.
Afin works only with legal entities and in the second half of 2008 repossessed 322 vehicles, compared with 103 in the first half. In January and February 2009, the number of repossessed vehicles amounted to 111. "There's an acute liquidity crisis on the market and our main target in 2009 is risk control (...)". The biggest number of vehicles are repos
