Investors cool on aircraft ABS as sector feels late cycle pressures

fotolia_planes
By Jennifer Kang
05 Sep 2019

Once highly prized for the attractive yields on offer, investors say they are backing away from aircraft ABS as heightened competition and one-off deals with weak collateral shine a light on late cycle behaviour in the asset class.

Despite consistent year on year issuance increases in the esoteric ABS sub-sector and strong demand from buyers, aircraft ABS investors say cracks are beginning to show.

“Several aircraft ABS transactions have been underperforming their original underwriting,” said Mario Rivera, managing director of the Fortress credit funds business. “People have been ...

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