S&P Global Ratings has raised its ratings on four American Airlines enhanced equipment trust certificates (EETCs).
The following EETC issue-level ratings have each been raised by one notch:
- American Airlines Inc., 2016-1A to 'BBB+' from 'BBB';
- American Airlines Inc., 2016-2A to 'BBB+' from 'BBB';
- American Airlines Inc., 2019-1A to 'BBB+' from 'BBB'; and
- American Airlines Inc., 2021-1B to 'BBB+' from 'BBB'.
In a statement, S&P said the higher ratings reflect updated valuation appraisals and most recent principal outstanding used to derive its loan-to-value (LTV) calculations and collateral credit assessments.
S&P has affirmed its ratings on AAL’s remaining EETCs, and its issuer credit rating on parent company American Airlines Group remains unchanged at B+, as affirmed in May this year.
“The upward revision to these ratings reflects lower-than-previously expected LTVs, which we derive from the latest available collateral appraisals,” said S&P.
"The value of the diversified mix of aircraft that serve as collateral for these EETCs has been more resilient than we had anticipated and all include Airbus A321, Boeing 737-800, and Boeing 787-8 aircraft (which range in age from approximately 4 to 11 years).
“The resulting decline in LTVs, inclusive of a steady semiannual debt amortization schedule, have improved collateral credit and ratings noted above.”