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Tax leasing is one of the most attractive sources of funding for airlines, who are keen to take advantage of 100% funding at sub-Libor rates whenever possible. Top-tier airlines have regularly turned to Japanese leasing as a financing tool since the 1980s, and there are no signs of this changing in...

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Bibliographic Details
Published in:Asset Finance International 2003-06, p.1
Main Author: Garton, Steve
Format: Article
Language:English
Subjects:
Aircraft
Airline industry
Equipment financing
Equity
Equity financing
Funding
Leasing
Operating leases
Polls & surveys
Severe acute respiratory syndrome
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Summary:Tax leasing is one of the most attractive sources of funding for airlines, who are keen to take advantage of 100% funding at sub-Libor rates whenever possible. Top-tier airlines have regularly turned to Japanese leasing as a financing tool since the 1980s, and there are no signs of this changing in the near future. With an unstable economy and volatile exchange rate, Japan may seem an unlikely source of tax equity. But even after a round of high-level bankruptcies, investors are still keen to be involved in the airline industry. Equity investors, despite a necessary long-term strategy, are understandably fickle. Elsewhere, there is no doubt that leasing deals are in short supply. Where tax equity is available, regulations have closed the jurisdiction to all but the bravest of investors.
ISSN:1367-8086