Chinese lessor CALC has launched a dollar-based asset-backed securitisation on the Shanghai Stock Exchange.
The company say this is both the first Chinese ABS denominated and settled in a foreign currency and the first aircraft-leasing-sector ABS in the public placement market.
Tianjin-registered China Asset Leasing Company Limited is the issuer of the ABS, which will have aircraft leasing assets as its underlying assets, says CALC. Huatai Securities Asset Management is the ABS manager.
CALC says the issuance "adds diversity to the types of financial products available in China, fills the void of ABS products in foreign currency, and provides an important investing and hedging tool for domestic investors".
It expresses its hope that the dollar-based asset pool "will gradually develop in mainland China, attracting more USD investment and helping investors to achieve stable returns and reduce the outflows of USD assets from China", adding: "Meanwhile, this will also serve as the price guidance for China's fixed-income products both short- and long-term."
CALC highlights the national priority attached to development of a diversified capital market. The lessor states that its ABS is "not only a meaningful implementation of the mandate from the 19th National Congress of the Communist Party of China, but also an important step by all parties involved in actively executing on the 'One Belt One Road' strategy and supporting the real economy in accordance with the national foreign exchange administration policies".
One Belt One Road – China's programme of infrastructural investments intended to boost Eurasian trade – requires "strong financing support... via multi-level financial instruments", says CALC, including "different options of financial and operating leasing to meet the growing demand for commercial aircraft to deliver the passenger traffic created from the construction of the OBOR".
The lessor's chairman Chen Shuang states: "As always, CALC will support the development of the Aviation Silk Road as part of China's One Belt One Road initiative."
Deputy chief Winnie Liu asserts that "since introducing the realisation of finance lease receivables into China in 2013", CALC has explored "a variety of products to meet investors' ever-changing demands".
Source: Cirium Dashboard
