FOR IMMEDIATE RELEASE March 27, 2005
Linda Formella (202) 565-3200
WASHINGTON, D.C.: The Export-Import Bank of the United States (Ex-Im Bank) is providing a loan guarantee of approximately $40 million from Standard Chartered Bank in New York, N.Y., to support the export of a Boeing 737-800 aircraft with two installed CFM International engines to Oman Air, based in Muscat, Oman. Oman Air took delivery of the aircraft on Friday, March 25, 2005, in Seattle, Washington.
This is the second aircraft delivered to Oman Air, an Omani flag carrier, to be financed with Ex-Im Bank support. The airline qualified for a reduced exposure fee in this transaction based on Ex-Im Bank's policy to reduce the exposure fee by one-third on financings of new U.S.-manufactured large commercial aircraft for buyers in countries that adopt and implement the Convention on International Interests in Mobile Equipment and the accompanying Protocol on Matters Specific to Aircraft Equipment. This international treaty, known as the Cape Town Treaty, will facilitate asset-based financing and leasing of large commercial aircraft and aircraft engines. Ex-Im Bank's exposure fee is the amount that Ex-Im Bank charges for its transaction risk.
On Monday, March 21, 2005, the Sultanate of Oman completed the final steps for adopting and implementing the Cape Town Treaty by depositing the necessary instruments with UNIDROIT, an international organization based in Rome, Italy, that is the official depository of the Cape Town Treaty and the related aircraft protocol. Oman is the sixth country to adopt and implement the Cape Town Treaty and the related aircraft protocol, which will become effective when eight countries have ratified or acceded to these agreements. The United States completed the ratification process for the treaty and the aircraft protocol in October 2004.
Ex-Im Bank is pleased to support the export of this Boeing 737-800 aircraft to Oman Air and to be able to offer the airline a reduced exposure fee, which reflects the improved risk profile of the transaction. By ratifying the Cape Town Treaty, Oman has taken a leadership role to encourage other countries in the Middle East and throughout the world to adopt the legal framework that will facilitate large commercial aircraft transactions, said Ex-Im Bank Chairman Philip Merrill.
The management of Oman Air is proud that Oman took the lead in ratifying the Cape Town Treaty, a treaty that reduces the risk for financiers and establishes a transparent legal mechanism for financing aircraft. The combined effect of Oman's ratifying the Cape Town Treaty, coupled with Ex-Im Bank's guarantee, ensured that Oman Air could obtain the lowest possible financing cost for this transaction, said Oman Air's Chief Executive Officer Abdulrahman Al Busaidy.
Ex-Im Bank, the official export credit agency of the United States, is in its 71 st year of helping finance the sale of U.S. exports, primarily to emerging markets throughout the world, by providing loan guarantees, export credit insurance and direct loans. In fiscal year 2004, Ex-Im Bank authorized nearly $4.2 billion to support the export of U.S.-manufactured, large commercial aircraft to 12 airlines in 12 different countries. For more information, visit www.exim.gov.