SH&E FEATURED PROJECT

Asset Management Services
SH&E’s Asset Management team recently provided specialist assistance to a leading investment bank in the preparation of a $750 million securitization financing. SH&E’s assistance was two-fold.

Firstly, we calculated the securitization trust’s liquidity requirements over the typical 20-year life of the financing in particular during the many default scenarios imposed by the rating agencies. This was done by rationalizing contingent cost estimates and by the development of a sophisticated computer model that predicts, for example, all maintenance expenses that the fund would face over the 20-year period. This estimate was compared to the predicted receipts of maintenance reserves and the resulting balance at any given time provides the liquidity requirements.

Secondly, SH&E prepared a comprehensive overview of the global commercial aviation industry that explained the relevance and relative importance of the drivers affecting aircraft values and rental rates.

This was the fifth recent assignment of this nature and, on each occasion, SH&E has materially assisted the investment banks in achieving investment grade ratings on the senior tranches by very significantly reducing the requirement to hold back rental revenue.