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Overview

CDB Aviation signs sale-and-leaseback agreement with Oman Air for five Boeing 737 MAX 8 aircraft

Commitment Year•2022Country of Activity•OmanDirect Recipient Country of Incorporation•OmanOverseas Jurisdiction•IrelandSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jan 6, 2022
End (actual)
Mar 1, 2023

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned companies

  • CDB Aviation Leasing

Receiving agencies

State-owned companies

  • Oman Air

Loan description

CDB Aviation signs sale-and-leaseback agreement with Oman Air for five Boeing 737 MAX 8 aircraft

Interest type•Unknown

Narrative

Full Description

Project narrative

On January 6, 2022, CDB Aviation Lease Finance Designated Activity Company (CDBALF or CDB Aviation) -- China Development Bank's (CDB) wholly-owned aircraft leasing subsidiary -- signed a sale-and-leaseback agreement with Oman Air for five new 162-seat Boeing 737 MAX 8 aircraft equipped with Leap 1B27 engines produced by CFM International. Under the terms of the agreement, Oman Air agreed, among other things, to assign to each of CDBALF or certain subsidiaries or nominees of CDBALF, respectively, Oman Air’s right to purchase and take delivery of each of five new Boeing 737-MAX8 aircraft from Boeing pursuant to an original purchase contract between Oman Air and Boeing. Such purchased aircraft were to be leased back by CDBALF or certain subsidiaries or nominees of CDBALF as lessor, respectively, to Oman Air under an operating lease agreement upon delivery. The last of the five aircraft was delivered on March 1, 2023.

Staff comments

1. Sale and leaseback (or sale-leaseback) agreements are generally considered to be off-balance-sheet hybrid debt products. 2. Muscat-based Oman Air is the national airline of the Sultanate of Oman and majority-owned by the Omani Government. 3. CDB Aviation Lease Finance Designated Activity Company (CDB Aviation) is an Irish subsidiary of China Development Bank Financial Leasing Co., Limited (CDB Leasing) that manages, leases, and owns commercial aircraft. CDB Leasing is a wholly-owned subsidiary of China Development Bank (CDB).