Lessor Receives $710 Million Payout Over Aeroflot Aircraft Leases

Aircraft lessor SMBC Aviation Capital has advised that it has settled with the Russian state-owned insurer NSK for $710 million for the sixteen aircraft and additional engines leased to Aeroflot.

Since the invasion of Ukraine, lessors have found it challenging to repossess aircraft from Russia. Given widespread sanctions, Aeroflot, amoung other Russian carriers, have resorted to cannabilizing their own fleet for parts, much to the lessors horror. This is where insurance have stepped in.

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For SMBC, the payout covered its aircraft and engines on lease to Aeroflot Group and stressed that the cash payment complied with the laws and sanctions against the Russian state.

Second recent claim

Irish lessor AerCap also recently reached an insurance agreement with Russia last month over the settlement of 17 aircraft and five leased engines on loan to Aeroflot and Rossiya; the value of this payout was expected to reach around $645 million.

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SMBC Aviation Capital

Confidently, one of the worlds largest aircraft leasing companies is headquartered in Dublin and owned by the Japanese Sumitomo Mitsui Banking Corporation. With a wide-ranging portfolio and a strong presence across Europe, the Middle East, and Europe, it has completed over 10,000 agreements across its 18-year history.

Considered Asia’s leading lessor and aviation finance company, its most prevalent markets are China, Singapore, Japan, and Europe. Alongside its Dublin headquarters, it maintains offices in Amsterdam, Beijing, Hong Kong, Kyiv, Moscow, New York, Seattle, Miami, Shanghai, Singapore, Tokyo and Toulouse.

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A big fleet

Given passengers at the airport are usually unsure if their aircraft is owned or leased by their operating carrier, it can be eye-watering to read how many SMBCs and other lessors own. It is estimated that over 40% of all aircraft are owned by lessors, which identifies just the market scale.

Looking at data retrieved from ch-Aviation, the lessor maintains a robust fleet of a wide range of aircraft. This includes over 300 Airbus A320/321 variants, 14 Airbus A350-900/1000, 174 Boeing 737-800/900, and 11 Boeing 787-8/9. This is separate from aircraft and is also managed by the lessor. In general, the average age of SMBC’s fleet is 6.8 years.

Photo: Joe Kunzler | Simple Flying

This is all shadowed by the world’s largest lessor, AerCap, also based in Ireland, sitting at approximately 1,800 owned aircraft, an additional 900 owned and managed engines, and many more on order with manufacturers. Not only does it deal with aircraft, but through its subsidiary, Milestone Aviation Group, you can add in another 355 helicopters.

Sources: ch-Aviation