Debt markets turn their attention to lessors

Barcelona
Source: Flightglobal.com
This story is sourced from Flightglobal.com

Open capital markets and bank interest beyond the European borders are responsible for a shift in the debt markets in last 18 months favouring operating lessors.

"The world changed for us in 2009 when ILFC provided investors with what they wanted: liquidity and scale, and that has been followed up by other larger leasing companies doing the same [in the capital markets],"said Aengus Kelly, chief executive officer of AerCap at the International Society of Aircraft Trading conference today.

ILFC's move created a "permanence to the markets that was never there before," he says.

Another development has been increased interest from global banks in the leasing market.

"These banks said right, I am not going to lend to the airlines, instead I am going to lend to one of the big leasing companies...due to the favourable risk reward scenario," he says.

Wells Fargo, the Royal Bank of Canada, Commonwealth Bank of Australia all have "exploited this huge gap", he says.

He adds: "So the opening of the capital markets and the emergence of these powerful banks outside of Europe mean the big operating lease platforms are here to stay."