CDB Aviation, a wholly owned Irish subsidiary of China Development Bank Financial Leasing (CDB Leasing), has released that the lessor entered into its inaugural sustainability linked loan (SLL) on December 1, 2023, anchored with a US$625 million (£496 million) syndicated term loan facility.
“This innovative facility marks a landmark transaction for the aviation finance space,” underscored Jie Chen, CDB Aviation’s Chief Executive Officer. “We’re thrilled to have leveraged our comprehensive sustainability strategy, with a particular focus on the activities across the environmental and social aspects of our operations, to secure this first major sustainability-linked loan syndicated facility among aircraft lessors.”
The SLL parameters of the facility are contingent on the satisfaction of sustainability performance targets (SPTs), based on the lessor’s three key performance indicators (KPIs), including two strong environmental and one social KPI related to reducing the carbon intensity of the CDB Aviation’s fleet, focusing on the most fuel-efficient aircraft; increasing the share of new-generation aircraft in the lessor’s fleet, pursuing its target to reach 60% of new-generation aircraft (by number of aircraft) by the end of 2025 and increasing the level of diversity, equity and inclusion (DEI)-related training for the workforce.
Moody’s Investors provided the second-party opinion as to the appropriateness of the KPIs and SPTs, confirming the conformity of the facility with the sustainability linked loan principles (SLLPs), with a best-in-class SQS2 rating.
The facility was financed by a group of MLA banks, including: Crédit Agricole Corporate and Investment Bank, BNP Paribas, The Hongkong and Shanghai Banking Corporation Limited, Natixis Corporate & Investment Banking, China Minsheng Banking Corp., Ltd. Hong Kong Branch, China Guangfa Bank Co., Ltd. Shenzhen Branch and China Construction Bank Corporation London Branch.
