B&B Air Announces Debt Repurchase Transactions

DUBLIN, June 1 /PRNewswire-FirstCall/ -- Babcock & Brown Air Limited (NYSE:
FLY) ("B&B Air"), a global lessor of modern, fuel-efficient commercial jet
aircraft, today announced that it has repurchased $20 million principal amount
of its securitization notes for $10 million in a privately negotiated
transaction funded from the Company's available cash. Additionally, the
Company paid $7 million for an option to repurchase an additional $100 million
principal amount of its securitization notes for $48 million within the next
nine months.

"This debt repurchase of $20 million face value of notes for $10 million and
the option strategy used to acquire an additional $100 million of notes for
$48 million is further evidence of the Company's commitment to add value for
our shareholders in as many ways as we can and in line with the cash being
generated by B&B Air," said Colm Barrington, CEO of B&B Air. "By purchasing
these notes at such deep discounts to the par value of the securities, we
reduce our leverage, bolster our ability to refinance the portfolio and
increase the Company's net asset value per share."

B&B Air continues to generate strong cash flows from its portfolio of modern,
fuel-efficient aircraft, leased to 36 airlines in 19 countries. At the end of
March, before the debt repurchase transactions were completed, the Company's
unrestricted cash was $34.5 million.

About Babcock & Brown Air Limited

Babcock & Brown Air ("B&B Air") acquires and leases modern, high-demand and
fuel-efficient commercial jet aircraft under multi-year operating lease
contracts to a diverse group of airlines throughout the world. B&B Air is
managed and serviced by Babcock & Brown Aircraft Management ("BBAM"), the
world's fourth largest aircraft lessor. For more information about B&B Air,
visit our website at www.babcockbrownair.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains certain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements may be identified by words such as "expects,"
"intends," "anticipates," "plans," "believes," "seeks," "estimates," "will,"
or words of similar meaning and include, but are not limited to, statements
regarding the outlook for B&B Air's future business and financial performance.
Forward-looking statements are based on management's current expectations and
assumptions, which are subject to inherent uncertainties, risks and changes in
circumstances that are difficult to predict. Actual outcomes and results may
differ materially due to global political, economic, business, competitive,
market, regulatory and other factors and risks. B&B Air expressly disclaims
any obligation to update or revise any of these forward-looking statements,
whether because of future events, new information, a change in its views or
expectations, or otherwise.

Contact:

Matt Dallas
Babcock & Brown
+1 212-796-3918
matt.dallas@babcockbrown.com

SOURCE Babcock & Brown Air Limited

Matt Dallas of Babcock & Brown, +1-212-796-3918, matt.dallas@babcockbrown.com