Details of Aviation Lessor Settlements With Russia Over Trapped Planes

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Aircraft leasing firms have struck settlements with Russia totalling around $2.7 billion for over a quarter of the roughly 400 aircraft stuck in the country since Moscow’s invasion of Ukraine in 2022.

In return, international lessors handed ownership of the planes to state insurance company NSK, which transferred them to Russian airlines.

Lessors have been suing dozens of insurers over losses of at least $8 billion over the trapped planes.

Some of the world’s largest aircraft lessors faced off against their insurers in a Dublin courtroom last week at the start of a months-long battle over around 2.5 billion euros ($2.7 billion) of insurance claims related to the jets.

A similar case is scheduled for London in October. Some cases are also due to be heard in U.S. states.

Below are details of settlements reached between lessors and Russia.

AERCAP

Ireland-based AerCap, the world’s largest lessor, said in September 2023 it had received $645 million from NSK in a settlement over 17 jets and five spare engines leased to state-controlled airline Aeroflot and its subsidiary Rossiya.

In December 2023, the lessor reached a second settlement worth $572 million over 47 aircraft and five spare engines leased to JSC Ural Airlines and JSC Siberia Airlines (S7).

AerCap has sued insurers such as AIG and Lloyd’s of London for $3.5 billion over the loss of 116 aircraft and 23 aircraft engines in London’s High Court under its all-risks policy.

AIRCASTLE ADVISOR

Aircastle said in January 2024 it had received in a settlement relating to four aircraft formerly on lease to two Russian airlines.

Aircastle filed a claim in New York against more than 30 insurers in October 2022 over nine aircraft and other equipment stranded in Russia.

Aircastle said in 2022 it had booked $252 million in impairment losses for the jets.

AIR LEASE

Air Lease said in December 2023 it had received about $64.9 million in cash as part of an insurance claim settlement for four Airbus jets it had leased to S7 Airlines. The settlement does not include five other aircraft previously leased to S7.

BOC AVIATION

BOC Aviation received $219 million in October 2023 for nine aircraft leased to Aeroflot subsidiaries Pobeda and Rossiya and $50 million in December 2023 for three aircraft leased to S7, out of a total of five aircraft leased to S7, according to court documents presented at the Dublin trial, where BOC is suing insurers.

Singapore-based BOC recognized an $804 million asset write-down in August 2022 relating to 17 aircraft in Russia.

CDB AVIATION

Irish-based lessor CDB Aviation, owned by the China Development Bank, said in October 2023 it had settled for 1.417 billion yuan ($195 million) over four planes and in December 2023 said it had settled for 145 million yuan for one plane.

The first settlement was for planes leased to Aeroflot and the second for a plane leased to S7, according to Dublin court documents.

CDB Aviation recognized a 747 million yuan asset write-down in August 2022 but said this was not the full value of the jets.

DUBAI AEROSPACE

Dubai Aerospace Enterprise (DAE) said in December 2023 it had received a cash settlement totalling around $118 million for seven aircraft previously leased to Aeroflot.

It wrote off almost $600 million for 19 aircraft stuck in Russia in 2022. DAE and its subsidiary Falcon are suing 11 insurers for $900 million in London over 21 aircraft and equipment.

GA TELESIS

GA Telesis said in December 2023 it had received an insurance settlement for two planes previously leased to Rossiya. It did not provide financial details.

SMBC AVIATION CAPITAL

Irish-headquartered SMBC, owned by a consortium including Japan’s Sumitomo Corp. and Sumitomo Mitsui Financial Group, said in October 2023 it had received a settlement of $710 million for 16 aircraft and their engines previously leased to Aeroflot.

SMBC fund GAEL received $18 million in September 2023 for one aircraft leased to Aeroflot, according to Dublin court documents. SMBC also received $46 million in December 2023 for three aircraft leased to S7, out of a total of 10 aircraft leased to S7, according to the documents.

SMBC recorded an impairment of $1.6 billion in 2022 to cover the full financial impact of having 34 jets stuck in Russia.

($1 = 0.9321 euros)

($1 = 7.2604 Chinese yuan renminbi)

(Compiled by Carolyn Cohn, Padraic Halpin, Conor Humphries, Kirstin Ridley and Gleb Stolyarov; editing by Mark Potter)

Topics Aviation Russia

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