Currency Risk


US 'white knights' reported as standing on sidelines ready to support aircraft funding
The Dow Jones said that notable U.S. banks that could pick up slack or buy any loan portfolios up for sale as a result of the euro funding crisis include J.P. Morgan Chase & Co, Wells Fargo & Co, Bank of America, and Citi. Societe Generale and BNP Paribas have been scaling back their aircraft financing business in the wake of the sovereign-debt crisis and the dollar shortage hitting European banks. "It's bad news given European aircraft manufacturer Airbus and U.S. rival Boeing Co. are funded in dollars and French banks arrange about 30 p.c.of financing", DJ said.


Modern treasury issues in aircraft finance
By deploying a suite of treasury tools including new instruments such as aircraft secured bonds and other new leasing options, as well as new and tried and trusted balance sheet hedging strategies, airlines can optimise their myriad of exposures to both P&L and balance sheet while ensuring the smooth daily operation of the carrier. We plan to explore all of these issues in greater detail in future editions of Aviation Finance, Joe Gill writes.

 

Opportunity for those with solutions as a new aircraft financing gap opens up
Amid the current financial uncertainty some very fundamental assumptions inherent to the nuts and bolts of how airline operational business models function and how their aircraft financing needs are addressed are being challenged. CIAN DOOLEY on the current financing landscape.


EADS move to price in euros rather than dollars
August 10th: EADS, The parent of Airbus, is reported to be in talks with airline customers about payments in euros as a hedge against US dollars. This is designed to assist Airbus in its hedging policies.

 

The Cutting Edge

GECAS highlights opportunities in Africa and launches aviation resource network