Wells Fargo forms aircraft leasing venture
Jan 17 (Reuters) - Wells Fargo & Co on Thursday said it is forming a new business that will lease airplanes as it looks for fresh ways to boost returns.
The No. 4 U.S. bank by assets is teaming with Irish aircraft leasing company Avolon to form a Dublin-based joint venture called Avolon Capital Partners that will buy new planes from airlines and lease them back.
The initial target for the aircraft portfolio is $500 million, Avolon said. Wells will be the majority shareholder and provide banking and debt financing for the business.
In a statement, Wells' head of asset-backed finance, Julie Caperton, said the bank was pleased to deepen its relationship with Avolon, a long-standing client. Since its start in 2010, Avolon said it has raised $3.7 billion of debt capital from a number of financial institutions, including Wells.
A year ago, Wells Fargo lost an auction to buy Royal Bank of Scotland's aircraft leasing business to Japan's Sumitomo Mitsui Financial Group and Sumitomo Corp. The San Francisco-based bank has been active in buying portfolios from European banks as it strives for more interest income.
The formation of the venture is subject to regulatory approvals.
- Target holiday cyber breach hits 40 million payment cards
- UPDATE 3-Saab wins Brazil jet deal after NSA spying sours Boeing bid
- Zuckerberg to sell Facebook shares worth about $2.3 billion
- Special Report: Why Ukraine spurned the EU and embraced Russia
- Facebook, Zuckerberg, banks must face IPO lawsuit: judge