NBAD arranges $400 million loan for Kuwait Airways

The facility comprises an eight-year term loan secured on the five aircraft and is currently in syndication, with an expected closing at the end of May.

By Staff Report

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Published: Mon 25 May 2015, 11:30 PM

Last updated: Fri 26 Jun 2015, 12:24 AM

Abu Dhabi: The National Bank of Abu Dhabi (NBAD) along with Arab Banking Corporation, was mandated by the International AirFinance Corporation (IAFC) as underwriters, book runners and lead arrangers on a $400 million senior secured Murabaha loan transaction.

The deal, which is IAFC’s inaugural syndicated loan, will finance the provision of five A330-200 aircraft on an operating lease to Kuwait Airways.

The facility comprises an eight-year term loan secured on the five aircraft and is currently in syndication, with an expected closing at the end of May. The borrower is a 100 per cent owned subsidiary of a fund managed by IAFC.

Vasgen Edwards, the global head of aerospace and transport at NBAD, said that this unique transaction also highlights “our expertise and expanding foothold in the Islamic finance segment.”

He added that the aviation industry is one of the fastest growing industries in the West-East corridor and one of the five top priority sectors for the firm’s wholesale banking activity.

Earlier this year, NBAD co-structured a $913 million UKEF-backed sukuk closed by Emirates Airline, making it the first time that a sukuk has been used to pre-fund the acquisition of aircraft.

IAFC is the first Shariah-compliant aircraft leasing fund dedicated to Airbus aircraft and seed funded by Airbus and Islamic Development Bank.

The fund is looking to target GCC, Mena, CIS and Southeast Asian airline carriers.

haseeb@khaleejtimes.com



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