Jetrader - Summer 2018 - 43

you see it in terms of bonds secured/
unsecured? Will you go for an investment grade rating? How do you see CDB
Aviation funding itself going forward?
PC: Currently, we really have two platforms in terms of funding. We have one
in China and onshore because we have
50 aircraft. And for placement into the
Chinese jurisdiction, naturally we go to
Tianjin, we go to Shanghai, we'll go to
Xiamen  - where the funds are raised
onshore. In terms of offshore, we think
we currently are basically 70/30 - 70 percent unsecured. We have a very fortunate
situation where we have a strong mothership. We have no reason to tap into a lot
of other markets.
But we have so many other more pressing things to do. We will probably table
the processes for investment grade for the
time being, only because we don't see any
practical reasons why we need to do it.

you think the greatest challenges facing
the industry are, and what keeps you
awake at night for CDB Aviation as you
try and grow the platform?
PC: I think one of the big things for
the industry is education. I went to a
[Guinness Peat Aviation] reunion a month
ago, and we all toasted happily that the
alums from GPA were on the senior level
of our industry by a significant percentage. That, to me, is an indication that we
really haven't had a platform of education that has the right architecture to

continue to develop the leadership for
the next generation.
As I said, we've been very fortunate to
be able to recruit well, but I don't think
that's the norm. I think we were just
lucky. As an industry, we all need to chip
in and do something large and small to
recognize this issue and to keep a higher
awareness where we will have a mechanism
that will  continue  to  generate the next
generation of managers for our business.
I think that's probably the biggest industry challenge.

JM: And the HNA group, I believe, and
your bank and your own company has
quite a few aircraft. They seem to be
making strides in terms of raising finance
and in other parts of their business. How
are you finding the process there?
PC: The biggest mystery to the HNA
group is transparency, so I don't know.
I don't know if anybody knows. We have
some exposure there as a lessor  -
though not the biggest; I think we rank
sixth or seventh last time I checked the
list. I think that it will be a process. We
look at it very closely; we have daily contact with them and we just we just have
to manage.
I think in the end, the airline itself is
going to be fine. They have a scale where
if you just carve out the airline operation
itself, it's well managed and is a profitable
business. It has a very strong positioning in
the China market, and they have their weaknesses, of course. They have their troubles
such as in Hong Kong and so on. But by
and large they are a healthy operation. So
I think we're going to find that we will go
through a period like we're going through
right now. The question is, once we get
into the tunnel, at what point do we get
out? Those are the things we've paid a lot
of attention to.
JM: In general for the industry - how it's
changed and where it's going - what do
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Jetrader - Summer 2018

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