Brazil’s state bank to finance Embraer aircraft exports to SkyWest

RIO DE JANEIRO, Oct 10 (Reuters) – Brazil’s state-owned development bank BNDES and aircraft manufacturer Embraer SA (EMBR3.SA) have reached an agreement allowing the lender to finance exports of six E-175 jets to the U.S. airline SkyWest Inc (SKYW.O), the bank’s chief executive told Reuters.

Bruno Aranha said in an interview that the loan was modeled as a post-shipment export credit, whereby BNDES will finance the exports and SkyWest will assume the debt.

It has also involved four private insurers – AXA XL, Axis Capital (AXS.N), Sompo International (8630.T) and Fidelis Insurance – Aranha said, as the public bank seeks to increase transactions secured by private companies.

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“We think that might be a trend going forward,” he said, noting that they could often be used for Embraer’s high-value shipments.

The last loan will mature in 12 years, according to Embraer. Financial details of the transaction were not disclosed.

Aranha said the bank could also help finance exports of Embraer’s KC-390 military aircraft, while noting that such deals could take longer to complete as they would involve foreign countries and their public sectors. .

“But we can be a tool to support KC’s exports to other countries, just like we do with jets,” he said.

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Reporting by Rodrigo Viga Gaier

Our standards: The Thomson Reuters Trust Principles.

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