Jetrader - January/February 2012 - 9

Deutsche Bank’s Moody on early 2012 deals…
“For the ﬁrst half of 2012, most borrowers would have completed their ﬁnancing plans, with most deliveries likely mandated. That said, there is a difference between mandating a party and actually funding upon delivery, and this is something that borrowers are increasingly paying more attention to. For the second half of 2012 and into 2013, the ﬁnancing outlook is less clear, but the expectation is that we will see increased levels of ECA support, although this still needs to be funded, and capital markets issuance will almost increase to ﬁll the funding gap caused by the ﬁnancial stress to the traditional European ECA providers.”

interested in buying EETCs from non-U.S. airlines. We deﬁnitely think there’s a lot of interest and they’re ready. From an airlines perspective, increasingly more and more airlines are going to be ready and interested in doing it. We’re starting to hear more from airline management teams outside the U.S. that they know they need to study the EETC because they see, as we do, that traditional forms of ﬁnancing are becoming more expensive. Ultimately it will result in a situation where ﬁnancing globally is more readily available to more players but probably at a higher priced point than four years ago when relationship bank money costs were at a very low-cost level.”

charge on aircraft ﬁnancing dial down their participation, who’s going help the regional players understand and get comfortable with risk? European and U.S. banks should continue to assume a leadership role and continue to partner with local institutions, but the challenge remains how to get the regional capital flows to become more international, and ﬁnance outside their traditional geographic footprint.”

And Moody on secondary market conditions…
“Capital in this industry is not only reserved for new aircraft deliveries. Capital also gets deployed for reﬁnancing of older aircraft and, in addition, there are currently a number of bank debt portfolios on the market where investors can also put their money to work. Therefore with these opportunities where yields may be more attractive, this could impact the amount of primary liquidity available as investors do have a choice as to where to deploy capital.” Thanks to Boeing for coordinating the panelists’ responses and supplying related editorial content.

Goldman’s Lee on the global markets’ readiness to accept new cap market structuring…
“I’ll answer that from two perspectives; one is the perspective of investor. They are deﬁnitely ready for it. We think that what has limited EETC issuance outside the U.S. has been supply, not demand. Big institutional investors have always been

Deutsche’s Moody on the role of regional banking…
Regional airlines generally tend to be able to attract ﬁnancial support locally, where there is some sort of government ownership involved. European banks have historically taken a more global approach to aircraft ﬁnancing and have generally tended to partner with local institutions. If these banks leading the international

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Jetrader - January/February 2012

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