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Turkish Airlines records $12bn aircraft financing deals in 10 yrs, bags 21 awards

Turkish Airlines has crowned its success with 21 international finance awards in the past 10 years for raising $12 billion with three new awards for its successful aircraft financing models.

The three new awards won at Bonds & Loans Awards Night and which brought the number of awards on its financial models to 21 include “Transport Finance Deal of the Year”, “Trade and Export Finance Deal of the Year” and “Structured Finance Deal of the Year”.

Turkish Airlines has been awarded as the runner up in “Trade and Export Finance Deal” category by Bonds & Loans for its brand new B777-300ER aircraft delivered in September 2015.

The total financing builds up to 16,8 billion Japanese Yen and the structure is a combination of an innovative, complex and unique U.S. Ex-Im Guaranteed French Tax Lease.

This structure has been successfully implemented by Turkish Airlines by placing the financing in Japanese Yen rather than placing the predominant currency in aircraft finance which is American Dollar.

The structure was arranged by BNP Paribas, where tax leverage is achieved in this deal together with Ex-Im Bank Guarantee coverage, enabling Turkish Airlines to use the advantages of both export guarantee and tax leverage leading to a low cost of financing for the subject aircraft.

Turkish Airlines has been awarded as the runner up in the “Structured Finance Deal of the Year” category as well by Bonds & Loans for its brand new 3 A321-200 aircraft delivered between September and November 2015.

Turkish Airlines’ primary goal was to obtain a long-term and diversified cheap funding source. Accessing to the Japanese capital markets have added another source together with the banking market and contributed to diversify the geographic exposure.

Moreover, this transaction has also achieved an attractive 100% LTV financing at low cost by combining with Japanese equity. This deal is the first-ever JPY denominated EETC for aircraft financing in the world, which has established a brand new financing structure by integrating conventional EETC with JPY capital markets.

This fully worked-out structure put multiple aircrafts into multiple classes and provided liquidity support from a Japanese bank, which boosted the acquisition of higher rating than the obligor‘s credit.

Flag carrier has also been awarded as the finalist in the “Transport Finance Deal of the Year” category by Bonds & Loans at the awards ceremony held in İstanbul, for its brand new 1 B777-300ER and 8 B737-800 aircraft delivered between May and August 2016.

The total financing builds up to 430 million Euros and the structure is a combination of an innovative, complex and one-of-a-kind U.S. Ex-Im Guaranteed format French Tax Lease with Bridge Loan.

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