Standard Chartered has announced today that it intends to explore alternatives for the future ownership of its aviation finance business.
Standard Chartered’s aviation finance business, which includes Pembroke, is a global aircraft leasing and financing operation. It manages a modern fleet of aircraft and serves airline and financial institution clients across North America, Europe, Asia, Africa and the Middle East. The aviation finance business represents around 2% of total Group income and around 1% of Group risk-weighted assets (RWA).
Commenting on the announcement, Simon Cooper, Chief Executive Officer of Corporate, Commercial & Institutional Banking and Europe & Americas at Standard Chartered, said: “Our aviation finance business is an established global franchise with a differentiated track record of originating and servicing aircraft leasing and lending transactions, high-quality aircraft and loan portfolios, world-class airline relationships and a proven and respected management team. We believe that a new owner can drive the next phase of growth whilst we continue to focus on our commitment to improve shareholder returns and delivering on our 2024 targets.”
Standard Chartered is being supported by JPMorgan Securities as its financial advisor in connection with a potential transaction.
Standard Chartered commented that its decision to offload the aviation business was consistent with its business strategy outlined in February 2022, which outlines a commitment to boost its wealth management section, to support trade and retail businesses through the post-pandemic recovery, as well as a focus on sustainability - with a clear path to net zero by 2050 and a focus on sustainable finance. In its annual report published in February 2022, the bank noted that an improved operating performance in the aviation sector with a substantial reduction in "early alerts" back to pre-COVID levels. The bank noted that it was continuing to monitor its exposures in the aviation, as well as Metals & Mining and Oil & Gas sectors "particularly carefully, given the unusual stresses caused by the effects of COVID-19".