China Construction Bank establishes $500m aircraft leasing business in Dublin
A unit of China Construction Bank is establishing its $500m aircraft leasing business in Dublin. It also plans to expand its new Irish base to eventually handle shipping and other leasing operations.
CCB Leasing International (CCBLI) currently has just 17 aircraft in its portfolio, but aims to grow that to about 200 within the next five years.
There’s intense interest among Chinese investors in aircraft leasing, with significant increases in air passenger travel forecast in the region in coming years.
China’s Bohai Leasing recently agreed to buy Dublin-based aircraft lessor Avolon, which was co-founded by Domhnal Slattery. Bohai is majority-owned by China’s state-owned HNA Group. Avolon is listed on the New York Stok Exchange and the transaction places an enterprise value of $7.6bn on the Irish company. It has about $5bn of debt.
State-owed China Construction Bank launched the leasing business in Dublin this morning.
“Ireland is an ideal launch pad for European, African and American markets and we aim to expand into shipping and other leasing activities from our Irish base in the future,” said Hongzhang Wang, chairman of China Construction Bank.
He added that international expansion of CCBLI’s aircraft leasing division is “integral to the development” of its transport portfolio and will help establish CCBLI as a “world leader in (the) leasing business”.
At the ceremony in Dublin’s Shelbourne Hotel this morning, CCBLI and IDA Ireland signed an official memorandum of understanding.
“The Memorandum of Understanding signifies our already strong relationship with the IDA and our commitment to Ireland,” said Jingpu Gu, chairman of CCB Financial Leasing.
In a bilateral meeting with Minister for Business and Employment Ged Nash following the ceremony, Mr Wang and senior China Construction Bank officials discussed CCBLI’s performance strategy and outlined their growth plan for Ireland.
Mr Nash pointed out that half the world’s commercial aircraft fleet is now managed out of Ireland, and that the leasing sector employs 1,200 people here.
Martin Shanahan, the chief executive of IDA Ireland, said that the leasing arms of five of the top six Chinese banks now have operations in Ireland.
“Attracting investment from Asia is an important part of IDA’s global strategy and China is a key strategic market for us,” he said.