A key feature of Emirates' recent enhanced equipment trust certificates (EETC) financing is the carrier's ability to tap the capital markets without a credit rating, according to Doric.
"We were able to attract a diverse investor base with focus on the US-rated EETC transaction without a rating of the airline," said Paul Kent, chief commercial officer of Doric, at the Ascend Finance Forum.
"We also created a benchmark structure for both airlines and lessors that will enable quick and efficient future access to the US capital markets," he adds.
As there is no rating requirement for the airline, Kent says there is "no rating maintenance going forward and no rating agency influence on the management strategy".
In June, Moody's Investors Service assigned "A3" and "Baa3" ratings, respectively, to the Class A and Class B certificates for Doric's second EETC, (DNA Alpha), that will fund the purchase of four new Airbus A380 aircraft on lease to Emirate.
"To successfully market a pure A380 transaction proves the US capital markets' acceptance of the aircraft type and enhances investor appeal," he says. The capital markets also offer an "alternative to the shrinking commercial bank debt market at comparable LTVs [loan to values] and pricing and significantly more size and liquidity," he says.
Both tranches on Emirates' first EETC have "traded up" since closing, demonstrating a liquid secondary market, he says.
Moody's Investors Service assigned "A3" and "Baa3" ratings, respectively, to the Class A and Class B certificates on the first EETC.