before tax for Q3 2008 of €17m (£13.8m) for its worldwide
operations, compared with a profit of €191m (£155m) in the same
period a year ago.
The consumer financing and leasing arm of carmaker BMW said that
falling sales, plummeting residual values and higher levels of bad
debt had all taken their toll, resulting in an additional risk
provision expense, totalling €477m (£387m) for the nine months to
September 30 2008. “Alongside these negative factors, refinancing
conditions also deteriorated as a result of wider credit spreads on
the capital markets,” the captive added.
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The profit before tax for the nine months to September 30 2008,
at €131m (£106m), was also “well below” the figure for the same
period a year ago (see table) – down 76.7 per cent.
On a brighter note, BMW Financial Services grew the number of
lease and finance contracts in place with dealers and retail
customers by 17 per cent in the nine-month period to September 30
2008 to just under 3m, with new contracts during Q3 2008 growing by
14.7 per cent year on year to 313,173.
The total business portfolio as of September 30 2008 grew by
17.1 per cent compared with the same date in 2007 to €57.9bn
(£47bn). “This increase was mainly due to the integration of the
vehicle portfolio of an external leasing company which had included
a part of the leasing business for Germany,” the captive finance
house said.
Leasing business grew by 4.2 per cent during the first nine
months of the year while credit financing increased by 21.4 per
cent. “Leasing business and credit financing accounted for 34.3 per
cent and 65.7 per cent respectively of new contracts signed,” the
captive reported.
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By GlobalDataUsed car financing volumes grew by 26.4 per cent during the nine
months to September 30 2008, with nearly two-thirds of used car
finance agreements relating to buyers of pre-owned BMWs and
MINIs.
Penetration rates for the Financial Services division among
buyers of BMW vehicles also performed well, up 3.3 points to 48 per
cent during the first nine months of the year.
