Lessor SMBC Capital Aviation wrote off $1.6 billion due to aircraft stolen by Russia

aviation, airplane, air communication

SMBC Capital Aviation, one of the world’s largest aviation leasing companies, recorded a net loss of $1.1 billion in the last financial year, writing off $1.6 billion due to the termination of contracts with Russian airlines due to sanctions imposed against the Russian Federation in response to the full-scale war launched by Russia against Ukraine.

This is stated in the company’s message, Interfax-Ukraine reports.

“We are writing off the full value of all 34 aircraft remaining in Russia, as they are no longer under the company’s control,” the message said.

The company believes it is unlikely that it will be able to return the planes from Russia in the near future, or ever.

“Our advantage lies in our extensive insurance coverage, and we are confident that we will be able to recover a significant amount of write-offs,” SMBC Capital Aviation said in a statement.

The additional profit of the company without taking into account one-time factors according to the results of the fiscal year that ended on March 31 amounted to $336 million, which is slightly below the level of the previous year of 2019 ($364.5 million).

“Despite the ongoing challenges, the company’s business will benefit from the ongoing market recovery and increased interest from airlines and investors in our portfolio of high-quality assets,” said Peter Barrett, Chief Executive Officer of SMBC Capital Aviation.

In May, the company struck a deal to buy smaller competitor Goshawk Aviation for $6.5 billion and expects to close in the fourth quarter of this year.

SMBC Capital Aviation, registered in Ireland, is a privately held company owned by the Sumitomo Group.

Earlier it was reported that Russia may be expelled from the International Civil Aviation Organization (ICAO) due to aircraft theft.

It will be recalled that earlier the Russian Federation refused to return to the owners the planes used by Russian airlines under leasing conditions. For this purpose, the authorities of the Russian Federation have also adopted special legislation on the compulsory registration of aircraft in their registry, fearing that Russian airlines will not be able to fly without aircraft of global manufacturers. In particular, the sanctions prohibit operational leasing of aircraft in favor of Russian carriers. Therefore, the leasing contracts of more than 700 foreign aircraft were unilaterally terminated, while 78 aircraft of Russian carriers were arrested abroad.

At the same time, the aviation authorities of Bermuda and Ireland, where the most aircraft used by Russian airlines were registered, suspended their certificates, and the US Federal Aviation Administration lowered the flight safety rating for Russian airlines, considering that Rosaviatsia does not meet ICAO safety standards.

After the invasion of Ukraine, Great Britain, the United States, the European Union and other countries introduced restrictions on the flights of Russian airlines. The European Union also introduced a ban on the export to Russia of goods and technologies used in the aviation and space industry, as well as a ban on insurance and maintenance of goods related to these industries.

After that, the American aircraft manufacturer Boeing temporarily stopped maintenance and support of Russian airlines and supplying them with spare parts. The same restrictions were introduced by the European manufacturer Airbus. Джерело: https://biz.censor.net/n3352927


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