Airbus seeks better control over financial supply chain via bank acquisition
Formation of Airbus Group Bank is pending regulatory approval, as the group follows in the footsteps of Siemens, Daimler, BMW and Peugeot by establishing an in-house bank to improve financial flexibility. February 20, 2014 | Magessan RajIn the wake of tighter credit conditions following the 2008 and Eurozone financial crises, aerospace and defence company Airbus Group unveiled plans to acquire Germany’s Salzburg Muenchen Bank, as it seeks to further financing options. Having agreed to the purchase with the Raiffeisenverband Salzburg cooperative, the deal is currently subject to regulatory approval, with Airbus planning to create an in-house bank that will allow it to offer loans and guarantees to suppliers, as European banks continue to scale back on non-core business activities, such as aircraft financing, to better cope with shrinking revenues and tougher regulations. Formerly known as European Aeronautical Defense & Space Co., Airbus Group has yet to disclose financial details of the deal, but has revealed that it would rename the entity as Airbus Group Bank, and aims to complete the acquisition by this year. The group chose to purchase Salzburg Muenchen Bank due to its reputation as a “conservative and well-managed existing banking platform”. The bank currently has about $478 million in total assets and 50 employees. Following in the footsteps of other European industrial heavyweights such as Siemens, Daimler, BMW and Peugeot in forming its own in-house bank, the jet manufacturer initially explored the possibility of setting up a bank in 2012 to protect its own access to credit and that of its customers, with Europe’s financial upheaval showing little signs of recovery then. “In the coming years the whole group can benefit through increased financing flexibility,” said Harald Wilhelm, chief financial officer at Airbus Group. A recently issued statement from the company read, “The main purpose is to increase finance flexibility, facilitate financing of non-controlled joint ventures and offer attractive conditions based on the Airbus Group rating.” The planemaker is currently rated A2 by Moody’s Investor Service and the equivalent... Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
Categories: Trade Finance, Transaction BankingTrade Finance,Transaction Banking, Trade Finance,Transaction Banking, Keywords:Airbus Group Bank, Salzburg Muenchen Bank, Harald Wilhelm, Boeing Airbus Group Bank, Salzburg Muenchen Bank, Harald Wilhelm, Boeing
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