Development Bank of Japan Inc. (“DBJ”) and Sompo Japan Nipponkoa Insurance (“SJNK”; Keiji Nishizawa, President and CEO) have extended financing to EL AL Israel Airlines Ltd. (“EL AL”) for the purchase of aircraft through the Aircraft Finance Insurance Consortium (“AFIC”) made available by Marsh, the world’s leading insurance broker and risk adviser. This is the first project in Japan to finance an aircraft purchase through AFIC. EL AL will use the funds from this financing project for the purchase of Boeing 787-9 aircraft.
AFIC is a finance instrument developed to meet the rising global demand for aircraft. Under the scheme, major overseas insurance companies insure aircraft purchases by airlines and leasing companies to cover defaults on principal and interest payments. By providing insurance to the AFIC scheme ? a first for a Japanese insurance company ? SJNK has created a system that facilitates participation by Japanese financial institutions.
With this scheme, DBJ and SJNK will contribute to the development of the aviation industry by offering airlines and leasing companies a new method of procuring funds. Equally important, the scheme will stimulate Japan’s financial markets by offering new opportunities for aircraft finance to regional banks and other institutions seeking to expand their cross-border financing.
Expanding its involvement in aircraft finance is in keeping with DBJ’s corporate philosophy: “Applying financial expertise to design the future: By opening up new frontiers, we resolve the issues of our clients and society for the sustained development of Japan and the world.”
Corporate Finance Department, Division4 +81-3-3244-1640
DBJ Extends Aircraft Financing to EL AL in Collaboration with Sompo Japan Nipponkoa InsuranceJapan’s First Aircraft Finance Scheme to Employ Insurance
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