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Overview

CDB Aviation Lease Finance leases one Airbus A321-200 aircraft to Asiana Airlines for sub-lease by Air Seoul

Commitment Year•2017Country of Activity•KoreaDirect Recipient Country of Incorporation•KoreaOverseas Jurisdiction•IrelandSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Dec 18, 2017
Start (actual)
Dec 18, 2017
End (actual)
Dec 18, 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

  • CDB Aviation Lease Finance DAC

Receiving agencies

Private Sector

  • Air Seoul, Inc.
  • Asiana Airlines, Inc.

Loan description

CDB Aviation Lease Finance leases one Airbus A321-200 aircraft to Asiana Airlines for sub-lease by Air Seoul

Interest type•Unknown

Narrative

Full Description

Project narrative

On December 18, 2017, financial close was reached on a deal in which CDB Aviation Lease Finance DAC — the wholly-owned Ireland-based subsidiary of China Development Bank Financial Leasing Co., Limited (CDB Leasing) — entered into a lease agreement with Asiana Airlines, Inc. — a South Korea-incorporated airline headquartered in Seoul and listed on the Korea Exchange with KUMHO Industrial Co., Ltd. as its largest shareholder (33.47% stake at the time of the lease) — for one Airbus A321-200 aircraft. The aircraft would be an operating lease. Asiana Airlines then entered into a sub-lease agreement with Air Seoul, Inc. — a South Korean low-cost carrier based Incheon International Airport in Seoul and wholly-owned by Asiana Airlines — for the aircraft. CDB Aviation delivered the aircraft on December 18, 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.