Walkers advised Aircraft Finance Insurance Consortium on several transactions
The Marsh-sponsored Aircraft Finance Insurance Consortium (AFIC) has been the buzz of the air finance community since officially launching almost a year ago. The AFIC product is a non-payment insurance product designed for banks and capital markets investors that are funding new aircraft purchases from Boeing. The product is underwritten by four global insurance companies: Allianz, AXIS Capital, Sompo International (formerly Endurance) and Fidelis.
AFIC was created to fill a gap left by the reduced activity of export credit agency (ECA) and US EXIM Bank financings. AFIC has exceeded expectations by closing approximately US$1.5 billion in financing on 16 Boeing aircraft in its first year. In the recently announced 2017 Airfinance Journal Awards, two AFIC financings received recognition, including for Overall Deal of the Year and Tax Lease Deal of the Year.
Walkers has represented clients in a number of AFIC structured transactions. Walkers was Irish counsel on Intrepid Aviation’s closing of its first AFIC backed financing for one 747-8 Freighter, and is significant as it is the first non-payment insurance backed financing ever closed by an operating lessor.
Walkers also acted as Cayman Islands legal counsel on Norwegian Air Shuttle’s AFIC backed-bonds financing six Boeing 737 aircraft. As well as legal counsel, Walkers Professional Services acted as fiduciary advisor providing SPV and director services to the aircraft owning SPV. Norwegian is the first airline to use this finance structure to purchase Max 8 aircraft, and is the first AFIC transaction in the Cayman Islands.
With AFIC already mandated on 14 aircraft in 2018, and a goal of up to 60 more, we expect the acceleration of AFIC to continue well into the coming months. Given Walkers’ expertise with this novel product from a legal and SPV services perspective, do please reach out to Walkers if we can assist with any of your AFIC needs.
Walkers advised Aircraft Finance Insurance Consortium with a team including James Burch (Picture), Paul Osborne, Edward Rhind, Steven Manning, Elaine Anderson, David McGovern, Eoin O’Connor, Ken Rush and Fiona de Lacy.
Involved fees earner: James Burch – Walkers Global; Paul Osborne – Walkers Global; Edward Rhind – Walkers Global; Steven Manning – Walkers Global; David McGovern – Walkers Global; Eoin O’Connor – Walkers Global; Ken Rush – Walkers Global; Elaine Anderson – Walkers Global; Fiona de Lacy – Walkers Global;
Law Firms: Walkers Global;
Clients: Aircraft Finance Insurance Consortium;