New Delhi: State Bank of India, the country's biggest lender is evaluating options to enter the aircraft leasing business after the government, in the Union budget for 2021-22, had announced incentives for aircraft leasing companies to open offices in the Gujarat International Finance Tec-City (Gift City), an international financial services centre, near Ahmedabad.
“We are evaluating options to handle aircraft leasing business in Gift City subject to regulatory approvals and viability,” the Economic Times quoted Ashwini Tewari, managing director – international banking, technology and subsidiaries, at SBI as saying.
As the state-owned lender does not have any expertise in running an aircraft leasing business, it is looking for a foreign partner for the proposed venture, the publication mentioned citing people familiar with the development.
“SBI does not have the expertise of running an aircraft leasing business and the bank is looking for a foreign partner that has the expertise in the sector,” the business daily quoted an unnamed person as saying.
The leading public sector bank’s entry into the business is on the lines of Bank of China, which entered the market as part of a plan by the Chinese government to develop China as a leasing hub for aircraft.
Worth mentioning here is that Bank of China has become one of the largest aircraft leasing companies in the world and is also the third-largest in India in terms of the number of aircraft leased. The company has leased more than 25 aircraft to various airlines in India.
With the announcement of incentives, at least five companies have shown interest in opening aircraft and helicopter leasing companies at Gift City, the ET report said.
International aircraft asset management company Acumen Aviation and Mumbai-based aviation service firm Vman Aero are said to be setting up an aircraft leasing shop. To start with, these companies will look at Indian airlines for business, the publication mentioned citing sources. They have about 1,000 aircraft on order and currently lease planes through leasing firms based out of Ireland, Hong Kong and Singapore among others.
01/03/21 ETNowNews.com
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