Asian banks are expected to fund more non-Asian carriers over the next three years, according to delegates at the International Society of Transport Aircraft Trading (ISTAT) conference in Tokyo last week.
An estimated 42% of the delegates said Asian banks will increase their exposure to non-Asian airline names. Still 37% of the audience expects lending to be "about the same" while the remaining 21% anticipates less lending through 2016.
An estimated 59% of the delegates said that 2013 will see an increase in lending compared with last year.
About half the voting audience expects "more lending" this year while another 12% expects bank to lend "much more" in 2013. Still about a third of the audience says banks will lend as much as in 2012 while only 9% expects a decrease in lending in 2013.
Commonwealth Bank of Australia executive vice president Nick Fletcher says bank capital is "north of $35 billion" in the $100 billion required in financings this year for new commercial aircraft.
He sees the European banks coming back in the market place. "We see signs of some resurgence of European banks but I am not sure whether it is durable," he comments.
"There is not much evidence of Asian banks leveraging outside domestic markets as lenders. Clearly some are more active in the European context but the broad base of Asian market is not participating or filling the vacuum the European banks have left."
About 46% of the audience expect loans to value and advance rates in 2014 to stay at the same level. Another 42% expect them to go up while the remaining 12% anticipates a drop in loans to value and advance rates next year.
An estimated 60% says capital markets will not challenge bank lending in Asia in 2014. While more non-US carriers enhanced equipment trust certificates (EETC) transactions are on the cards in the second half of this year, half the ISTAT audience in Tokyo did not expect an Asian carrier to tap the EETC market. However 22% said one carrier could issue debt in the form of a EETC, while another 21% expects two carriers to tap the market. Another 6% anticipate more than two carriers in the EETC market this year. Prospects for next year's EETC issuance in Asia are more spread. One in three attendees at ISTAT anticipate two carriers to issue a EETC in 2014, while another 23% expects one carrier to tap the market.