Narrative
Full Description
Project narrative
In 2018, ICBC Financial Leasing Co., Ltd. (ICBCFL; ICBC Leasing) — a Chinese state-owned leasing company and wholly-owned subsidiary of the Industrial and Commercial Bank of China (ICBC) — entered into leasing contracts worth $600 million USD with Silversea Cruises Ltd. — a Bahamas-incorporated Monaco-headquartered ultra-luxury and expedition travel brand operating cruise ships — for two new ferries.
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. In June 2018, Royal Caribbean Cruises purchased a majority stake in Silversea Cruises Ltd. from its owner Manfredi Lefebvre d'Ovidio, Italian-born Monegasque billionaire. The sale was completed in July 2018. It is unclear whether the ICBC lease occurred prior to or after the purchase. For the time being, as the sale was completed in July 2018 (i.e. more than halfway through the year), AidData has treated it as having not gone through prior to the lease, and has coded the Origin accordingly. The issue merits further investigation.