London, April 16^th 2021 – Falko Regional Aircraft Limited (Falko), a market leading aircraft operating leasing and asset management company focused on the regional aircraft sector, today announced that it has priced its inaugural aircraft securitization (“ABS”) financing transaction: Regional 2021-1. This is the first ABS transaction completed since the COVID-19 pandemic which is exclusively secured by regional aircraft assets. The deal is the core element to a refinancing package for an aircraft leasing portfolio funded by the Falko Regional Aircraft Opportunities Fund. Falko will act as servicer for the transaction.

“We are delighted to have completed this significant regional aircraft financing transaction” said Jeremy Barnes, Chief Executive Officer, Falko Regional Aircraft Limited. “We have worked with Citi and institutional investors to structure a transaction that helps address some of the market concerns resulting from the adverse impact COVID-19 has had on the aviation sector and airlines in particular.”

“The regional aircraft segment has demonstrated its resilience in the last year, which has grabbed the attention of investors; the recovery is being seen first in the domestic and short haul segments that are the core markets for regional aircraft. We feel that this deal reflects positively on the regional aircraft sector and Falko in particular as a proven servicer with a track record through a number of aviation cycles.”

Regional 2021-1 totals $255.0m of Class A asset-backed debt that will be used to finance a portfolio of 39 regional jet and turboprop aircraft on lease to up to 12 operators in 12 countries. The aircraft types include Embraer E190/E195, ATR 72 and Dash-8 Q400 with a weighted average age of 10.7 years.

Kroll Bond Rating Agency has indicated that the Class A tranche will be assigned a BBB+ rating.

Citi acted as the sole structuring agent and bookrunner. “We have partnered with Falko for some time on an investor education effort surrounding both Falko and regional aircraft assets” said Matt Simonetti, Managing Director, Citi.

“Falko’s expertise extends beyond regional aircraft leasing into spare engine leasing, part-outs and in-house MRO experience. This provides investors with confidence in their investment decision, especially when looking beyond the underlying assets and towards a brand and platform, such as Falko, that they trust to execute in a challenging environment.”

Sun Life Assurance Company of Canada is the liquidity facility provider and Canyon Financial Services Limited is the managing agent. Allen & Overy LLP acted as lead counsel to Falko with Maples Group and Alston & Bird providing local advice. PwC provided tax advice. The investors were advised by Milbank LLP as lead counsel.