ELFA Survey

The survey measures compensation rates for the 2009 fiscal year as reported by 50 equipment finance companies representing a cross section of the equipment finance sector, including small-ticket, middle-market, large-ticket, bank, captive and independent leasing and finance companies. The survey results provide market data for more than 90 management and staff positions in front-office, middle-office and back-office functions, as well as salary, bonus and commission data, broken out by company type, portfolio size, annual volume and ticket size.

Survey Highlights

• Declines Mirror Market Challenges: With the tightening of credit standards, rising defaults and a one-third decline in new business volume compared with 2008, total compensation declined across functions within the industry. However, the story varies across levels, firms and sectors.
• Total Compensation Declined At Senior Levels: Total compensation in 2009 declined as much as 25% for some originators at the manager and senior levels but also increased as much as 15% for some of the population, particularly at the senior and intermediate levels. An analysis of a consistent group of originators demonstrated that more than half saw a decrease in total compensation compared with 2008. Of those that did receive increases in total compensation, half of those saw increases between 0% and 20%, while the remaining population enjoyed increases of greater than 25%.
• Captives Trailed the Market: Originators at independent firms received the largest increases in 2009. Banks with originators at captive organizations received the smallest increases.
• Health Care and Technology Pay Highest: Pay in the health care and technology sectors was significantly higher than all other sectors, while pay in the industrial/construction sector ranked the lowest.
• Collections and Remarketing: Many firms identified collections and equipment remarketing as areas where there is a strong need for qualified professionals. The equipment remarketing function remained flat compared with 2008, with a 5% increase for senior employees. The collections function was flat to up to 5% at the median, yet increased 5-10% at the high end compared with 2008.
• Salaries: Salaries remained largely unchanged from historical levels, even for the heads of the business. The survey findings do not indicate significant jumps will occur in 2010/2011.
• Long-Term Awards: While the survey does not indicate an increase in the use of long-term awards yet, many firms continue to discuss the possibility of implementing a long-term component to pay. The survey does indicate that changes to incentive plans in 2011 could include a vehicle for aligning the pay schedule with the realization of profits.

Salaries in the equipment finance sector remained largely unchanged in 2009, while total compensation declined across functions within the industry, according to the Equipment Leasing and Finance Association's 2010 Equipment Finance Compensation Survey. More than half of the sales positions tracked in the survey saw a decrease in total compensation in 2009 compared with 2008.