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Overview

BOC Aviation leases six Boeing 737-800 aircraft to Mukamalah Aviation Company

Commitment Year•2017Country of Activity•Saudi ArabiaDirect Recipient Country of Incorporation•Saudi ArabiaOverseas Jurisdiction•SingaporeSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Implementation

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jan 1, 2017
Start (actual)
Jan 1, 2017
End (planned)
Dec 31, 2017

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

  • BOC Aviation Limited

Receiving agencies

State-owned companies

  • Mukamalah Aviation Company

Loan description

BOC Aviation leases six Boeing 737-800 aircraft to Mukamalah Aviation Company

Interest type•Unknown

Narrative

Full Description

Project narrative

In 2017, BOC Aviation Limited — a Chinese state-owned aircraft leasing company and wholly-owned subsidiary of Bank of China (BOC) — entered into operating lease agreements with Mukamalah Aviation Company — a Saudi Arabian airline headquartered in Dammam and wholly-owned subsidiary of state-owned oil company Saudi Aramco — for six Boeing 737-800 aircraft. Prior to September 12, 2017, BOC Aviation had delivered three 2017-vintage aircraft to Mukamalah. On September 12, 2017, BOC Aviation delivered the fourth aircraft. Two new Boeing 737-800 aircraft were be delivered in 2017.

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.