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Turkish Airlines becomes first airline to use new insurance-backed aircraft financing product

Posted 21 March 2019 · Add Comment

Turkish Airlines has become the first airline to use the brand new insurance-backed aircraft financing product “Balthazar” combined with French lease, with the financing of its A321 NEO aircraft arranged by BNP Paribas.

 

The product was developed by Airbus with the cooperation of an insurance consortium consisting of several highly-rated insurance companies to address the need of new products in the aircraft financing market. Turkish Airlines successfully combined a French lease advantage in this 12-year transaction together with insurance cover, leading to an innovative and cost-effective product that contributed significantly to the overall competitiveness of its aircraft financing portfolio.

BNP Paribas, a leading bank in aircraft financing with an international reach and a long-term financing partner of Turkish Airlines, committed a financing amount of up to 225 million USD for five A321 NEO aircraft to be delivered in 2019. In managing a large number of stakeholders and under various roles, BNP Paribas played an instrumental role in handling this first-of-a-kind transaction on behalf of Turkish Airlines.

Turkish Airlines has had very innovative and first-of-a-kind financing models rewarded by ‘Jane's Transport Finance’, ‘Global Transport Finance’, ‘Airline Economics’, ‘Airfinance Journal’, and ‘Bonds, Loans & Sukuk Turkey’ in respect of its financing models put in practice since 2008. Turkish Airlines has crowned its success in this regard, as having won 23 international aircraft finance awards in the last ten years for its successful financing performance amounting to 15 billion USD.

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