Avation PLC (LSE: AVAP), the commercial passenger aircraft leasing company has successfully refinanced two leased Airbus A220-300 aircraft. The aircraft were previously financed in Avation’s floating rate warehouse finance facility and have now been refinanced with fixed rate term loans from a major Japanese bank. The loans, which have Euro and USD tranches, amount to approximately $43.7 million and the extended term of 8.5 years matches the lease duration.
Executive Chairman Jeff Chatfield said “Avation welcomes its first major Japanese bank as a lender. Avation has strategically lowered its floating interest rate risk by fixing these loans for a period of 8.5 years. Avation is now 94.8% hedged against interest rate increases in its loan book using fixed rate loans and interest rate swaps. We were also pleased to be able to lower the interest rate margin for these loans which we consider to be an excellent result in the current financial environment.”