Korean Air Lines (KAL) securitized $300 million of its passenger ticket sales predominately on its North America routes.
It is the issuer's first U.S. dollar-denominated securitization of passenger ticket recivables. Standard Chartered Bank acted as the sole arranger and lead manager for the transaction, which was closed on Nov. 22.
The notes, issued through KAL ABS 8 Cayman Limited, mature on October 2014 and have a floating rate coupon of 200 basis points over one-month U.S. dollar Libor, according to a press release issued by Standard Chartered.
The notes have been rated 'A1' by Moody’s Investors Service based on the credit facility and an interest rate swap provided by Korea Development Bank.
“Given KAL’s leading position in the trans-Pacific routes and robust transaction structure, we were able to achieve a very competitive pricing despite the continuing market turmoil,” said Warren Lee, global head of structured financing solutions at Standard Chartered.
KAL has been active in the cross-border securitization market. This is the airline company's sixth such transaction. As of June 30 2011, it has a fleet of 135 aircraft, with passenger and cargo routes to 103 cities in 35 countries.