CJI REPORT
AVIATION LENDERS
CJI REPORT • AVIATION LENDERS
Financing f light
Business jet financiers around the world are seeing the same key trends – younger buyers, new entrants – and plenty of opportunities. Words: Rob Hodgetts, Fayaz Hussain and Yves Le Marquand
Financing f light
Business jet financiers around the world are seeing the same key trends – younger buyers, new entrants – and plenty of opportunities. Words: Rob Hodgetts, Fayaz Hussain and Yves Le Marquand
Financiers focus their thoughts
Hover over the cirlces to reveal their details
Financiers focus their thoughts
Vivek Kaushal, CEO, Global Jet Capital
Steven Hawkins, international head of Speciality Lending, JP Morgan Private Bank
Sarah Lim, executive director at UBS
Michael Thompson, vice president, JetLoan Capital
Andrew Blundell, MD, Aviation and Marine Finance, Close Brothers
Christopher Lee, president of Aircraft Financing Division, 1st Source Bank
Mark Bearden, senior vice president, First American
GREENBACKS. BUCKS. Dough. Ask any aircraft financier who their biggest competitor is and they will never mention another bank or finance company. The answer is always the same.
“Our biggest challenge is – and likely will always be – cash,” says Vivek Kaushal, CEO, Global Jet Capital, which is active worldwide. “As finance specialists, we work to help clients understand and evaluate the trade-off between using their own cash or credit lines to finance a depreciating asset versus using ours to preserve liquidity and putting their money to work. It’s about maximising efficiency and return on their capital.”
Andrew Blundell, MD, Aviation and Marine Finance, a specialist division of Close Brothers, a UK bank, agrees that “cash is king” for some potential owners, many still prefer to take out finance to “maintain liquidity” for their next business opportunity.
His bank will finance both new and pre-owned aircraft and will also consider refinancing already-owned aircraft to release capital for other purposes, including overhauls, upgrades or rebuilds.
Clients, predominantly based in the UK and Ireland, are high-net-worth individuals and their families, as well as operators and corporate businesses.
There is another truism that financiers also often say: every deal is different.
“It’s a common saying, but also incredibly accurate,” says Blundell. “With the number of variables involved, like loan size, aircraft type and the client’s credit profile, it’s impossible to have a typical deal.”
But while those two rules remain, financiers are seeing their clients for longer.
Getting younger
Unlike the the old joke about policeman getting younger, this is a definite trend with aircraft buyers.
“With the great wealth transfer going on, we expect to see younger travellers enter the market and are optimistic about the next five years and beyond,” says Mark Bearden, senior vice president, First American. The organisation has been a subsidiary of City National Bank since 2012, which itself was acquired in 2015 by Royal Bank of Canada (RBC). “As a private, entertainment, commercial and corporate bank, we serve clients with close ties to private aviation. It is both a substantial and growing part of our overall portfolio, especially in the past five years.”
The rise of younger buyers is a global trend. Jetcraft, the global broker dealer, says that the number of its customers under 45 has nearly doubled in the last decade to a record 29% in 2024.
“It’s no longer rare to see Millennials or even Gen Z becoming ‘new tech’ billionaires, selling companies in their 20s or inheriting family investments younger as part of the ‘Great Wealth Transfer,” said Jahid Fazal-Karim, owner and chairman of the Board, Jetcraft, when publishing its annual survey. “Greater numbers of entrepreneurs under 45 are turning to business aviation to run their companies and support their lifestyles, drawn by the appeal of privacy, security and efficiency. With changing demographic comes increased diversity – 42% of our younger buyers are from the entertainment industry and 29% are women.”
Private banks are also seeing this. “We have observed a growing interest from younger entrepreneurs and tech founders, particularly in Asia, India and the Middle East,” says Sarah Lim, executive director of Aviation & Yacht Finance at UBS. “The role of women in aviation finance will also be more prominent, contributing diverse perspectives to strategy and innovation.”
UBS has established itself as one of the leading global players providing tailored financing solutions for business jets, especially following the merger with Credit Suisse. The company’s Aviation and Yacht Finance Division is 25 years old with representatives spread across Singapore, Hong Kong and Zurich. This global team manages transactions from origination to structuring and continuing management.
“Geopolitical instability and market volatility are key concerns. However, by maintaining robust financing structures during uncertain times, we are well-prepared to navigate these challenges,” says Lim.
As well as getting younger, UHNWIs are also moving across borders. Henley & Partners, an international investment migration advisory firm, expects a record 142,000 millionaires to relocate in 2025. It forecasts that the UK will lose 16,500 millionaires and China 7,800.
“Our clients are becoming truly global, and we are unwavering in our commitment to support their evolving needs, especially as their residencies shift, requiring adaptable aviation assets,” says Steven Hawkins, international head of Specialty Lending, JP Morgan Private Bank.
Shutterstock
“42% of our younger buyers are from the entertainment industry and 29% are women.”
Advertisement - article continues below
Hawkins’ team serves private clients across the world with tailored aircraft financing solutions, whether that is the purchase of a new or pre-owned aircraft, refinancing an existing one, or releasing capital for other investments. Each solution is designed to support their clients’ long-term wealth objectives.
The bank’s aircraft financing specialists collaborate with the client’s private bank team to negotiate the nuances of a transaction and structure the loan accordingly.
“We offer flexible options that allow clients to access potential liquidity without disrupting their investment portfolios,” adds Hawkins.
He says the bank sees “strong growth” in the private aircraft market. A recent Market.us report from April 2025 suggests a compounded annual growth rate of 6.7% over the next decade, from $26.6bn in 2024 to $80.8bn by 2034.
Hawkins agrees that the growth being experienced isn't limited to the traditional large markets like the US and Europe. He says it is “increasingly fuelled” by aircraft ownership in emerging markets, particularly Latin America.
First-time buyers
The post-Covid boom saw a raft of new buyers. Financiers say this trend is continuing. “Business aviation finance is on the climb”, Michael Thompson, vice president at JetLoan Capital tells CJI. “That’s particularly true of first-time buyers who are entering the market as they recognise the productivity and benefits of aircraft ownership.”
Founded in 2017, JetLoan Capital provides aircraft and yacht financing, using a network of more than 200 banks, credit unions, leasing companies and private equity sources. The Florida-based company provides what it calls a “full spectrum” of aviation finance solutions, including loan origination, refinancing and structured financing for piston, turboprop and jet aircraft.“What distinguishes JetLoan Capital is our independence and breadth of relationships,” says Thompson. “We are not tied to a single institution, which allows us to shop each transaction across our network.”
Thompson says renewed bonus depreciation legislation is also encouraging new and existing owners.
Bearden agrees, saying First American has seen an influx of potential buyers getting more serious about making a purchase before the end of the year.
“For many, bonus depreciation pulled them squarely off the fence and moved them into investing the time and energy to find the right asset and pair it up with financing through First American,” he explains. “The pipeline and conversations, while not at the same level as 2021-2022, have been noticeably different than the prior two years. Because of this promising activity, we expect the portfolio to grow in the quarters ahead.”
Moving from ownership
One trend that is harder for some banks is the move away from whole ownership. Before the global financial crisis, many banks offered non-recourse fractional share financing, but few continued offering it after incurring losses during the downturn.
First American is one of a few lenders that likes financing fractionals. In 2015, Bearden initiated the practice at First American, requiring guarantees, a down payment, amortisation to prevent large final payments and active loan management. “We expect to see that segment continue to capture more market share as providers look to find different ways to better serve clients,” says Bearden.
While many US financial institutions have offered operating leases for a long time, Global Jet Capital has pioneered the product internationally and is seeing increased demand.
“Our sense is that as the industry continues to mature, more businesses and HNWIs are recognising the value of operating leases, including better leverage for their cash or banking lines, predictable expenses, reduced residual value risk, and certitude at time of disposition,” says Kaushal, who joined Global Jet Capital in 2015, when it acquired the GE Corporate Aircraft Finance portfolio first as chief risk officer, then as president and chief operating officer.
“If the aircraft is a key element of your operational environment, why take on the full capital risk when a lease can provide efficiency and flexibility?,” he says. “As clients increasingly prioritise capital efficiency and risk mitigation, leasing will continue to grow in relevance.”
“Greater numbers of entrepreneurs under 45 are turning to business aviation to run their companies and support their lifestyles ....”
Jahid Fazal-Karim, Jetcraft
Advertisement - article continues below
Optimistic outlook
The collapse of Lehman Brothers may have been 17 years ago, but memories of the Global Financial Crisis are still fresh. No financiers are getting carried away.
“We are seeing a steady demand for finance and are not seeing evidence of market oversupply or stressed selling,” says Close Brothers’ Blundell. “Macroeconomic factors weigh on customers’ decisions for high-value purchases, but most are experienced business owners who have traded through economic cycles before and will continue to steer a steady course.”
Another financier excited about new aircraft is Christopher Lee, president, Aircraft Financing Division, 1st Source Bank. “We also see potential in financing newer aircraft types that emphasise safety and efficiency, as well as in providing flexible solutions for operators adapting to evolving regulatory and tax environments,” adds Lee, who is an active aircraft owner and commercial pilot.
UBS says the business aviation finance market is in a growth phase despite uncertainties surrounding trade and tariffs. “We anticipate business aviation finance to be in the climb in the near future. While the second quarter of 2025 was marked by the uncertainties of the new US tariff landscape, we still saw a healthy business aviation market with about 7% of the global fleet on sale,” Lim tells us. That compares with a benchmark of 10%.
Despite this excitement around potential growth, UBS says challenges remain. “Geopolitical instability and market volatility are key concerns. However, by maintaining robust financing structures during uncertain times, we are well-prepared to navigate these challenges,” she says.
And some things will never change. Blundell adds: “Ultimately, it’s still people dealing with people and personal relationships will continue to be critical.”
Operating leases are set to grow in popularity, says Vivek Kaushal.
