S&P Global Ratings has upgraded SMBC Aviation Capital's credit and unsecured ratings after the company received $1 billion combine equity and debt.

The Dublin-based lessor is now holds an "A-" issuer rating and a "BBB+" senior unsecured rating, S&P writes in a report on 29 November, citing "debt-to-capital declined to the high-60% area from the high-70% area" as a reason for the upgrades. The rating agency notes that the the "debt–to-capital ratio had been weaker than that of other aircraft lessors with similar businesses".

The "stable outlook reflects our expectation that the company's EBIT interest coverage and FFO to debt will remain fairly consistent through 2020", adds S&P.

On 28 November, SMBC Aviation Capital shareholders Sumitomo Mitsui Finance and Leasing (SMFL) and Sumitomo Mitsui Banking Corporation (SMBC) finalised a deal first announced 12 months ago to recapitalise the lessor, together providing $700 million in preferred equity capital, while SMBC has also extended a $300 million subordinated loan.

Fitch Ratings also gives SMBC Aviation Capital an "A-" for its credit and senior unsecured ratings, last affirming its view on 17 July.

Source: Cirium Dashboard

Topics