SOVEREIGN DEBT RESTRUCTURING | MASTERCLASS

A deep dive masterclass on sovereign debt restructuring, to be conducted virtually by Asian high yield bond expert Florian Schmidt.

30 June 2022 (Thu), 5pm Singapore/HK time

Seven aircraft leasing companies have raised $14.9bn this January thus far, given the confidence in robustness of the travel sector, as per data from Dealogic. “Out of the whole travel sector they are probably one of the better positioned…It’ll be a while before anything normalises but the types of planes they have will remain out there. The terms they have with the airlines, they can withstand the expected downturn” said Monica Erickson, head of IG at DoubleLine Capital. Companies like Aircastle, AirLease and AerCap have raised a combined $2.5bn through 7Y, 3Y and 5Y bond issues respectively. Since lessors have long lease tenors, the main risk they face is airlines being unable to pay lease commitments or going bankrupt. Now that airline companies have raised capital after the pandemic broke out, leasing companies have been further reinforced. With vaccine rollouts and lower rates, borrowing costs have also dipped – for example, AirLease issued a 10Y bond with a coupon of 3.13% in November and the yield is currently at 2.75%.

Aircastle’s 4.25% 2026s were down 0.5 to 107.35, yielding 2.73% and AerCap’s 5.875% 2079s were up 0.3 to 102.28, yielding 5.19%.

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