Lead Manager

SECTION 3
BUSINESS OVERVIEW
Key drivers
The key driver of this business is the creativity and expertise of the Special Products team, which comprises a
core team of senior professionals, with average experience in the structured finance industry of in excess of
17 years. A significant portion of activities involve cross-jurisdictional elements.
A key distinguishing characteristic of Babcock & Brown in this market has been its ability to present a client with
a unique and well developed transaction structure, together with the ability to arrange the funding associated
with such structures on a multi-jurisdictional basis if so required.
Key risks
Changes in accounting, tax law and other regulations are the principal areas of risk to products created by the
Special Products team. Such changes, however, also provide significant additional structuring and product creation
opportunities.Traditionally, most products have had a lifecycle of up to five years with new products replacing
previous ones on a regular basis.The ability to create new products to address the prevailing market conditions
and regulatory environment is therefore a critical part of this business, and an area in which Babcock & Brown
has been consistently successful over the long term.
Finance Leasing
Finance Leasing is Babcock & Brown’s longest-standing Business Unit with a 27-year operating history. Its core
activities are lease advisory work (for both lessees and lessors) and the arrangement of complex leasing
transactions, including the placement of tax-enhanced equity and secured debt.The Business Unit is focused
primarily on “big-ticket” leasing such as aircraft, power-related assets and rail.
Aerospace Finance Leasing
Overview
The aerospace sector is a key area of focus for the Finance Leasing business. Babcock & Brown’s activities in this
area revolve principally around finance leasing (primarily “leveraged leasing”) of aircraft; and include:
• Financial advisory services to aircraft lessors and lessees
• Private placement of US tax lease equity in leveraged-lease financings and secured long-term debt financing
of commercial aircraft for both major and regional US airlines and international carriers
• Financial advisory services in connection with lease restructurings, bankruptcies and private-equity capital
placements
Babcock & Brown has established a reputation as the leading advisor and arranger of commercial aircraft privately
placed lease financings. More recently, it has also become involved as an advisor in several major restructurings,
and Chapter 11 filings including advising United Airlines, the US’ second largest international carrier.
In addition to these core activities, the Group has begun acquiring corporate jet aircraft for short-term resale
typically after adding value through refurbishment.This activity has been established in conjunction with a
leading broker of corporate jet aircraft with whom Babcock & Brown has a long-established relationship.This
activity is similar to the asset trading activities of BBAM, Babcock & Brown’s aircraft operating leasing business.
78