SMBC Aviation Capital chief executive Peter Barrett has highlighted the potential offered by South Korean and Taiwanese capital as sources of aircraft finance.
"We've invested quite a bit of time in the Korean market over the last number of years, including investor conferences and generally helping that whole education curve in that market, and what you see is a market with a lot of funding available for these types of assets," said Barrett during a panel discussion at the ISTAT Americas conference in Phoenix on 1 March. "They’re probably cash-long and opportunity-short."
However, Barrett cautions that that "this is not something that's going to happen over two or three or four years", and cites the example of Japan, which "has been involved in the aircraft leasing industry for decades" during which it "started from small things and has grown into much bigger things".
He acknowledges that Japan is differentiated by tax benefits available there, but is unequivocal that South Korea "has the potential to be an important market".
Nor is South Korea alone as an Asian nation that could serve as a contributor of aviation capital. Having noted the emergence of China as "a very important market" for leasing and financing, Barrett zeroes in on Taiwan and that nation's "big pool of dollars".
He adds: "Aircraft have gone from being a niche, off-piste investment to being much more mainstream, and I think that reflects very well on the experience of people investing in aircraft.
"When I started in the business 25 years ago, it was seen as a high-risk industry, whereas it's now seen as very stable and a consistently performing industry, and that's the story we're selling to investors in places like Korea and Taiwan."
Source: Cirium Dashboard
