Willis Lease Finance Corporation (WLFC) has marketed WEST IX, its $392.9 million aviation asset-backed securitisation (ABS) deal yesterday (December 10).
The deal marks the engine lessor’s 10th aviation asset-backed securitisation (ABS) transaction and the second of 2025.
WEST IX’s A tranche amounts to $337.4 million, while the subordinate B note holds the remaining $55.5 million. The notes have an anticipated repayment date of December 2031, with a legal final maturity date of December 2050.
The A tranche has an initial loan to value (LTV) ratio of 73% and is expected to be rated A by KBRA and Fitch.
The B tranche has an LTV of 85% and is expected to be rated A- by Fitch, with no preliminary rating assigned by KBRA to the tranche.
Proceeds will be used to refinance its existing WEST III and WEST VII transactions, as well as acquire a portfolio of 49 assets.
The portfolio consists of 46 narrowbody engines, one regional jet engine, and two narrowbody airframes on lease to 19 lessees across 14 jurisdictions.
The weighted average remaining term of the initial lease contracts is around 2.5 years, according to KBRA. This includes off-lease assets in the mix. The portfolio has an initial value of around $462.3 million.
A $2.6 million security deposit will be funded at closing and ongoing targeted amounts will be based on the amount of leases expiring within four months, KBRA said. The transaction’s structure also includes a liquidity facility sized to nine-months of interest due on the notes.
The structure includes a minimum number of assets test, requiring Willis Lease to use excess cash to fully pay down the notes in the event that it owns less than eight assets and note principal falls below one-third of its scheduled level.
The portfolio’s engine assets include 15 CFM56-7B engines, 11 PW1100G engines, nine CFM56-5B engines, nine V2500-A5 engines, two LEAP-1B engines, and one CF34-10E engine. The two airframes are one A320ceo and one A320neo.
The transaction contains two PW1100G engines subject to a finance lease with VietJet as opposed to typical aviation ABS deals that usually comprise of assets on operating leases.
The top three lessees include Delta, VietJet, and Air India which hold 11.2%, 9.5%, and 8.9% of the portfolio by value, respectively.
Joint structuring agents and joint lead bookrunners were Bank of America and BNP Paribas. Bank of America is also the liquidity facility provider. US Bank National Association is acting as trustee.