ABS: Aviation ABS Global Rating Methodology

Executive Summary

This report describes the Kroll Bond Rating Agency, LLC and its rating affiliates (collectively, “KBRA”) rating methodology for rating commercial aircraft and engine leasing asset backed securities (ABS) transactions (together, referred to as “Aviation ABS”).

KBRA views the following factors as key determinants in the rating process of an Aviation ABS transaction:

The composition and quality of the aircraft
The credit strength of the initial lessees
The operational abilities and financial strength of the servicer
Overall leverage and debt amortization profile relative to the projected values of the aircraft
Cash flows derived from lease payments and aircraft sales under stress scenarios
Structural enhancements including, but not limited to, overcollateralization, subordination, liquidity, maintenance reserves, early amortization and debt service cash trap triggers and cash deposits
Jurisdictional risks relating to…

KBRA is a global full-service rating agency with a mission to set a standard of excellence and integrity. Established in 2010, KBRA remains dedicated to the restoration of trust in credit ratings by creating new standards for assessing risk and by offering timely and transparent ratings. KBRA provides market participants with an alternative solution by delivering in-depth research across various sectors within the United States and European markets. We strive to provide the investment community with the products and tools needed to make informed investment decisions.