EX-IM BANK SUPPORTS BOEING 747 SALE TO PHILIPPINES
The Export-Import Bank of the United States (Ex-Im Bank) is financing the $119 million lease of a Boeing 747-400C aircraft to Philippine Airlines Inc. (PAL). The aircraft will service the airline's popular Manila-San Francisco and Manila-Los Angeles routes with nonstop flights.
The transaction is part of an aggressive fleet modernization program by the privatized Philippine flag carrier that could lead to substantial follow-on business. The 747-400C can be configured to handle various mixes of passenger and cargo service. Initially it will be used in an all-passenger configuration.
PAL's earlier lease of three Ex-Im Bank-financed 747-400s turned the Los Angeles and San Francisco routes into profitable ones for the airline. The fourth B747-400 will make PAL even more competitive on those routes by enabling it to provide daily non- stop flights to Manila from both Los Angeles and San Francisco on new aircraft.
Ex-Im Bank is providing a $98 million guarantee of a loan by Chase Manhattan Bank, NY. Additional commercial lending and Japanese equity will complete the funding for the deal. The Ex- Im Bank transaction is an asset-based financing in which the aircraft serves as collateral. The financing is structured as a leveraged lease with a Japanese special purpose company as lessor of the aircraft.
The Philippines is one of Ex-Im Bank's largest Asia markets. The Bank's current exposure in the Philippines totals $1.9 billion.
Ex-Im Bank is an independent government agency that helps finance and promote the sale of U.S. goods and services around the world.