Narrative
Full Description
Project narrative
On June 23, 2023, BOC Aviation (USA) Corporation — a Nevada-incorporated wholly-owned subsidiary of BOC Aviation Limited, a Singapore-based Chinese state-owned leasing company — entered into a finance lease agreement worth an estimated $314 million USD with JetBlue Airways Corporation — a Delaware-incorporated American major airline headquartered in Long Island City, in Queens, New York City and traded on Nasdaq Stock Exchange — for two Airbus A321NEO aircraft and five A220-300 aircraft. The lease was secured by (i.e. collateralized against) against the seven aircraft. The seven aircraft are each equipped with Pratt & Whitney GTFTM engines. The finance lease of the first Airbus A220-300 aircraft closed on June 23, 2023, with the finance leases of the remaining aircraft scheduled to close in 2023.
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. $314 million USD was assessed by industry media sources to be the value of this finance lease agreement.