Banks probed on HNA exposure; New Head of Aviation at DVB

Eleanor Steed
By Eleanor Steed June 27, 2017 09:48

Banks probed on HNA exposure; New Head of Aviation at DVB

Earlier this month, the China Banking Regulatory Commission (CBRC) ordered all domestic banks to assess their exposure to five Chinese companies that had been particularly acquisitive overseas. The five companies identified in the media include HNA Group, which owns an array of aviation companies including: Hainan Airlines Group, Swissport, Gategroup, and Bohai Leasing, which purchased Avolon.

News reports state that the regulators were only factfinding at this stage to assess if there would be any systemic risk for the domestic financial system presented by these highly-leveraged companies, which have been raising finance for international acquisitions and working capital, if they were to default on loans.

Zhou Xiaochuan, the central bank governor said that to prevent financial crises, “we cannot tolerate phenomena such as heavy leverage, low capital and non-performing loans.”

There is no indication or suggestion of wrongdoing on the part of these five companies but the issue raises the concern for over-levered companies in a jittery financial environment. (See our earlier article on the Chinese Black Swan for more on the issues facing China.)

Meanwhile, DVB Bank has appointed Eelco van de Stadt, the bank’s current Head of Aviation Finance North & South America, as Global Head of Aviation with effect from 1 August 2017. He will replace David Goring-Thomas who was recently appointed to join DVB’s Board of Managing Directors.

Eelco van de Stadt will relocate to DVB London Branch to assume his new position, from New York where, for the past eleven years, he has been leading DVB’s Aviation activities in the Americas.

David Goring-Thomas described his successor as having been a “key advocate for the establishment and growth of the full range of aviation activities which we offer our customer base: comprising investment management, asset management, advisory, research and, most recently, debt funds, in addition of course to our core structured finance/lending business.”

Eelco van de Stadt said: “I’m very pleased to be taking on this new challenge to lead DVB aviation in the years ahead. With airlines generally performing well, our market today is attracting an unprecedented level of bank, lessor and investor interest. This presents competitive challenges, but also fresh opportunities, as many of the new entrants look to benefit from our deep industry knowledge, global market coverage and range of services. With the industry constantly at risk of geopolitical events and other external factors, or should I say “shocks”, we will continue to position and develop our business so as to be equally effective in the good times we experience today, as well as through more volatile periods.”

Eleanor Steed
By Eleanor Steed June 27, 2017 09:48