Narrative
Full Description
Project narrative
On November 25, 2014, financial close was reached on a deal in which Sky High XXVII Leasing Company Limited — an Ireland-incorporated special purpose vehicle (SPV) of ICBC Financial Leasing Co., Ltd. (ICBCFL), a Chinese state-owned leasing company and wholly-owned subsidiary of the Industrial and Commercial Bank of China (ICBC) — entered into a sale-and-leaseback agreement with Norwegian Air Shuttle ASA — a Norwegian low-cost airline listed on the Oslo Stock Exchange — for one Boeing 737-800 aircraft.
Staff comments
1. A lease is a contractual arrangement calling for the lessee (user) to pay the lessor (owner) for use of an asset. The lessor is the legal owner of the asset, while the lessee obtains the right to use the asset in return for regular rental payments. Under a capital lease (a financial arrangement where the lessee/borrower uses an asset and pays regular installments plus interest to the lender/lessor), rental payments are usually classified as interest and obligation payments, similarly to a mortgage (with the interest calculated each rental period on the outstanding obligation balance). AidData codes capital leases as loans. 2. Sale and leaseback (or sale-leaseback) agreements are generally considered to be off-balance-sheet hybrid debt products. 3. In aviation finance, financial close typically occurs on or around the delivery date of the final aircraft. As financial close occurred on November 25, 2014, the aircraft was almost certainly delivered on or around that date. Thus AidData has coded the actual_implementation_start_date and actual_implementation_completion_date fields as November 25, 2014 and marked the actual_implementation_start_date_estimated? and actual_implementation_completion_date fields as True. 4. The commitment date for the sale-and-leaseback agreement is unknown. For the time being, AidData has coded the financial closure date, November 25, 2014, as the commitment date and marked the commitment_date_estimated? field as True.