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Bank of Communications Financial Leasing opened a new source of funding on Monday with a $300m securitization of loans backed by aircraft assets. Not only was this one of the few internationally marketed structured finance transactions out of Asia, it also marked the return of a rare credit support structure last seen publicly in 2014.
For BoCom Leasing, this transaction was more about diversifying its funding channels and trying out different structures having already ventured into the international debt market three times this year.
All three deals had their own variations. The A2/A-/A rated issuer raised $1bn in March with two-tranches of senior unsecured notes that were backed by a guarantee from BoCom Macau.
That was followed by a privately placed $300m 2.54% 2019 that was secured on a loan to BoCom Leasing Hong Kong and was backed by a cross-border guarantee from the company.
And in October, it fetched $1.5bn from another dual-tranche offering. But unlike its March outing, it was the first time BoCom Leasing sold senior unsecured notes without a guarantee from parent BoCom, relying solely on its standalone credit rating instead.
"The Chinese financial leasing industry is undergoing a huge expansion drive at the moment, so this is a company that has a lot of funding needs not just for this year, but also for the future," a DCM banker who worked on the sale said.
Because of...