Natixis, BPCE and J.P. Morgan co-arrange Turkish Airlines’ purchase of two B787-9 aircraft
Natixis, BPCE and J.P. Morgan co-arranged the financing of the loans guaranteed by the Export-Import Bank of the United States (EXIM) for Turkish Airlines’ purchase of two Boeing B787-9 aircraft, which were delivered in September and October this year. Natixis, BPCE and J.P. Morgan were lenders in the facility, which was combined with a French Lease for which Natixis and BPCE acted as lease arrangers.
In July 2020, the Export-Import Bank of the United States (EXIM) Board of Directors approved the loan guarantee to support these exports of Boeing airframes with engines manufactured by General Electric Company, Inc. This is the first long-term aviation transaction undertaken with EXIM support since 2015. The quorum on EXIM’s Board of Directors was restored by the U.S. Senate in May 2019, and the agency was reauthorized by the U.S. Congress for a record seven years in December 2019.
With an innovative structure embedding an EXIM guarantee coverage, a competitive overall cost of financing has been obtained by Turkish Airlines.
Gareth John, Global Head of Aviation, Corporate & Investment Banking at Natixis said: “Structuring and delivering this innovative solution, combining a French Lease with EXIM, is a testament to our strong relationship with Turkish Airlines and the successful cooperation between our client, EXIM, Natixis, BPCE and J.P. Morgan. This is the second deal that Natixis has closed for Turkish Airlines this year, underlining our capabilities as Lease Arranger and ECA Lender, as well as our commitment to supporting our clients during this challenging environment.
John Meakin, Global Head of Export Finance at J.P. Morgan, said: “This innovative structure has been collaboratively designed to meet our client’s financing priorities. It represents the first EXIM fronted large aircraft financing approved since 2015 and is a significant transaction at a time when support for our clients is most critical. We expect others to follow where Turkish Airlines has led – EXIM and ECA supported structures will be a key financing tool during an increasingly challenging time for the aviation sector”.
“The Export-Import Bank of the United States is focused on supporting American companies and workers—including those that make up very important U.S. supply chains. Because of President Trump’s leadership and Congress’ bipartisan support in fully reopening and reauthorizing EXIM for an historic seven years, the United States has necessary tools, such as loan guarantees, to help our great companies compete and win in the global marketplace. This authorization is a prime example of delivering on that mandate, and I congratulate all involved for their hard work and Turkish Airlines for choosing ‘Made in the USA’ aircraft and parts,” said EXIM President and Chairman Kimberly A. Reed.
Norton Rose Fulbright from its Paris offices advised the Lease Arrangers.
Established in 1933 with a fleet of five aircraft, Star Alliance member Turkish Airlines has a fleet of 360 (passenger and cargo) aircraft flying to 324 worldwide destinations as 272 international and 52 domestic, in 127 countries as of 30 September 2020. More information about Turkish Airlines can be found on its official website www.turkishairlines.com or its social media accounts on Facebook, Twitter, YouTube, LinkedIn, and Instagram.
J.P. Morgan’s Corporate & Investment Bank is a global leader across banking, markets and securities services. The world’s most important corporations, governments and institutions entrust us with their business in more than 100 countries. With $28 trillion of assets under custody and $634 billion in deposits, the Corporate & Investment Bank provides strategic advice, raises capital, manages risk and extends liquidity in markets around the world. Further information about J.P. Morgan is available at http://www.jpmorgan.com
EXIM is an independent federal agency that promotes and supports American jobs by providing competitive and necessary export credit to support sales of U.S. goods and services to international buyers. A robust EXIM can level the global playing field for U.S. exporters when they compete against foreign companies that receive support from their governments. EXIM also contributes to U.S. economic growth by helping to create and sustain thousands of jobs in exporting businesses and their supply chains across the United States. Since 1992, EXIM has generated more than $9 billion for the U.S. Treasury for repayment of U.S. debt. For more information, visit www.exim.gov.
Groupe BPCE, with its business model as a universal cooperative bank represented by 9 million cooperative shareholders, is currently the 2nd largest banking group in France. With its 105,000 employees, it serves a total of 36 million customers – individuals, professionals, corporates, investors, and local government bodies – around the world. It operates in the retail banking and insurance sectors in France via its two major Banque Populaire and Caisse d’Epargne banking networks, along with Banque Palatine. With Natixis, it also runs global business lines specializing in Asset & Wealth management, Corporate & Investment Banking, Insurance and Payments. Through this structure, it is able to offer its customers a comprehensive, diversified range of products and services: solutions in savings, investment, cash management, financing, and insurance. The Group's financial strength is recognized by four financial rating agencies: Moody's (A1, outlook stable), Standard & Poor's (A+, outlook negative), Fitch (A+, outlook negative) and R&I (A+, outlook stable).
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About Groupe BPCE
Groupe BPCE is the second-largest banking group in France. Through its 100,000 staff, the group serves 35 million customers – individuals, professionals, companies, investors and local government bodies – around the world. It operates in the retail banking and insurance fields in France via its two major networks, Banque Populaire and Caisse d’Epargne, along with Banque Palatine and Oney. It also pursues its activities worldwide with the asset & wealth management services provided by Natixis Investment Managers and the wholesale banking expertise of Natixis Corporate & Investment Banking. The Group's financial strength is recognized by four credit rating agencies with the following senior preferred LT ratings: Moody's (A1, stable outlook), Standard & Poor's (A, stable outlook), Fitch (AA-, negative outlook) and R&I (A+, stable outlook).
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