Nils Hallerstrom
Discussion Notes
January 2020
In these notes, I discuss how aircraft loan, lease, and portfolio Net Present Value can be analyzed as probability distributions rather than static numbers, accounting for default, aircraft value, and interest rate risks, thereby calculating risk and return measures to structure and price transaction. The notes address the analytical framework for measuring effects of diversification and cross-collateralization, as well as subordination. Other risk factors such as market cycle, prepayment, operational, currency and jurisdictional risks are also discussed.
