GE Capital survey shows low growth optimism in the economy
GE Capital came out with a survey, which shows that most CFOs of small to midsize companies see improved access to capital, low or moderate growth and healthy hiring.
CFO Survey Highlights:
- Worst of crisis is behind them
- Low-to-moderate growth in 2011, 2012
- Credit market conditions improving
- Stronger companies hiring at healthy rate
While maintaining a cautious tone, 84% of the CFOs said they expect the U.S. economy to be stable (47%) or improving (37%) over the near term, suggesting little chance for a double-dip recession in the months ahead.
“CFOs at middle-market companies, which are a significant engine for economic growth in America, believe the recovery will continue, if at a slower pace,” said Dan Henson, president and CEO of GE Capital, Americas. “Many companies that had been sitting on the fence before moving ahead on a major transaction, because of uncertainties in the economy and in credit markets, are now moving forward.
“We are seeing a healthy corresponding pickup in our commercial activity levels in the Americas,” Henson said. “Our corporate lending businesses are up dramatically with lending volume up 69% through the third quarter. Activity levels in our equipment finance businesses are growing but more modestly, up 10% in a market growing at about 5%.”
“None of the CFOs expect a double dip, and 84 percent see stable to improving” economic conditions, Dan Henson, who oversees GE Capital in the Americas, a unit of Fairfield, Connecticut-based General Electric Co., said in a telephone interview. “The picture has absolutely improved. You’ve got some moderate to decent growth.”
That’s in contrast to the survey GE Capital commissioned in the first quarter, in which about half of the CFOs queried said they were holding back from large capital purchases amid sluggish orders and stalled access to loans, Henson said.