ABSTRACT
This chapter describes the securitisation of aircraft and similar financing structures, which may have important implications for the long-term financing of the industry. They also provided one of the means for Guinness Peat Aviation (GPA) to recover from near bankruptcy. The equipment trust certificate (ETC) is often described as a securitisation. A modified version of the ETC is the enhanced equipment trust certificate (EETC), which looks more like the aircraft securitisations, and is further to the right in terms of relying more on asset risk. It evolved following the success of the international ALPS 92-1 securitization. ALPS 96-1 was the refinancing of the original ALPS 92-1 securitisation which resulted in the withdrawal of GPA and GECAS. Possible disadvantages of securitisation are a weakening of the relationship between the lessee and the lessor, as well as the additional workload imposed on the airline as a result of the increased number of parties involved.
