The aircraft finance industry, in a rut unlike any seen in the last 10 years, needs more than structural changes to right itself, according to U.S. regional airlines equity analyst Robert Ashcroft, a director at UBS, offering his conference summation remarks. Rather than focusing on structural topics that dominated the day, Ashcroft provided his thoughts on disclosure regarding aircraft values, fleet-lease rates and aircraft re-marketability that pose risks that structure has proven unable to mitigate.

"The nondisclosure of the ease of re-marketability to investors within a prospectus is a material omission," Ashcroft stated. He did concede that investors have become more aware of these details since September 11.

Instead of the current appraisal standard for valuing aircraft, Ashcroft preferred that a current market value be reported to investors, rather than the "base value" currently in prospectuses. The current appraisal system is insufficient, he added, because "the aircraft's base value is rarely realized."

He defined the base value as "the value of the aircraft in an ideal situation." Ashcroft suggested that the rating agencies require confidential access to the purchase price of EETC-financed aircraft to incorporate within EETC ratings.

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