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Overview

BOC Aviation enters into a sale-and-leaseback agreement with Czech Airlines (ČSA) for two Airbus A319 aircraft

Commitment Year•2008Country of Activity•Czech RepublicDirect Recipient Country of Incorporation•Czech RepublicOverseas Jurisdiction•SingaporeSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jun 16, 2008
Start (planned)
Jan 1, 2009
Start (actual)
May 1, 2009
End (planned)
Dec 31, 2010
End (actual)
Mar 1, 2010

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

Private Sector

  • České aerolinie, a.s. (ČSA)

Loan description

BOC Aviation enters into a sale-and-leaseback agreement with Czech Airlines (ČSA) for two Airbus A319 aircraft

Interest type•Unknown

Narrative

Full Description

Project narrative

On or around June 16, 2008, BOC Aviation entered into a sale-and-leaseback agreement with České aerolinie, a.s. (ČSA), or Czech Airlines — then, an independent Czech airline and flag carrier of the Czech Republic — for two Airbus A319 aircraft. The planes were scheduled to be delivered in 2009 and 2010, respectively. The planes were delivered on schedule, with A319-112 (OK-OER, msn 3892) delivered in May 2009 and A319-112 (OK-PET, msn 4258) delivered in March 2010.

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.