ALPS_EETC业务介绍

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1、tobepublishedinGUIDETOCAPITALMARKETS1998AircraftLeaseSecuritization:ALPStoEETCsby WilliamC.BowersSecuritizationsofaircraftleaseshavebecomeanimportantsourceofcapitalforU.S.airlinesaswellasforU.S.andnon-U.S.lessors.SuchfinancingprovidesaccesstotheU.S.andforeigncapitalmarkets,

2、openingupasignificantnewsourceofcapitalfortheairtransportationindustry.Therearetwobasicstructuresforsecuritizingaircraftleases:theenhancedequipmenttrustcertificate("EETC")securitizationandtheportfoliosecuritization.Thisarticlebrieflydescribesthesetwostructuresandthenconside

3、rstheirdevelopmentandthestateofthesecuritizationmarkettoday.EETCSecuritizationsAnEETCsecuritizationenhancesthecreditworthinessoftraditionalequipmenttrustcertificates("ETCs")securedbyleasereceivablesandtheleasedaircraftasfollows:First,theissueroftheEETCsisbankruptcyremote(an

4、dinsulatedfromabankruptcyofthelessee)tothesatisfactionoftheratingagencies.Second,theEETCsaretranchedtotakeadvantageoftheexpectedresidualvalueoftheaircraft,i.e.,thelowertheadvancelevel,thehighertherating.Third,aliquidityfacilityisprovidedtoensurethecontinuedpaymentofinterest

5、ontheEETCsduringtheremarketingperiodfollowingadefaultbythelessee.ThetermoftheliquidityfacilityinanEETCsecuritizationreliesontheabilityofalessortorepossessanaircraftfromabankruptlesseeundersection1110,ifthelesseedoesnotelecttoperform.TheprincipalissueindoinganEETCsecuritizat

6、ionwithanon-U.S.airlinewillbetheavailabilityof"section1110equivalent"repossessionrights,i.e.,theabilitytorepossessandremarkettheleasedaircraftinatimeframecomparabletothatallowedbysection1110.TheforegoingenhancementstotraditionalETCsallowEETCstohavecreditratingssignificantly

7、higherthanthecorporatecreditratingofthelessee,particularlyatloweradvancelevels.Thus,asub-investmentgradeborrowercanissueinvestmentgradedebt,andaninvestmentgradeborroweralsocanreduceitsborrowingcostswiththelowerpricingforhighergradesofdebt.PortfolioSecuritizationIncontrastto

8、theEETCstructure,aportfoliosecuritizationreliesonadiversifiedportfolioofaircrafton