Search
 
Alexander Hamilton Awards

Cash Pooling Takes Flight at a Midsize Aviation Business

Congratulations to Goshawk on winning the 2022 Alexander Hamilton Small Company Excellence Award in Treasury Transformation!

Goshawk: Winner of a 2022 Alexander Hamilton Small Company Excellence Award!

The airline industry is complex, with many different providers working together to ensure the smooth movement of passengers, planes, and goods across the globe. Every airline requires a fleet of airplanes—each worth tens of millions of dollars—as a necessary component of day-to-day operations. Goshawk, as an aircraft-leasing company, helps airlines reduce the capital burden of acquiring those assets.

“Consider a bank that is lending an airline $50 million to buy an aircraft,” says Damian Howley, head of treasury for Goshawk. “That creates a $50 million exposure to that one company and one aircraft, and the interest charges imposed are going to reflect that risk. Alternatively, if a leasing company like Goshawk borrows $50 million, the bank’s credit exposure is diversified across a range of airlines and aircraft around the world. There are exceptions, but typically this risk diversification allows Goshawk to raise debt at a lower cost than most airlines, so we can offer them attractive financing on the aircraft they need.”

A leasing arrangement with a company such as Goshawk can also increase the airline’s business agility. “Suppose an airline buys an aircraft to fly between London and Paris,” Howley says. “If something changes and that route no longer makes sense for some reason, the airline is stuck with the aircraft and no route to fly it on. However, with leasing, the airline can return the aircraft at the end of its lease. This gives airlines more flexibility in managing their fleets over a long-term period.”

Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.

Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical Treasury & Risk information including in-depth analysis of treasury and finance best practices, case studies with corporate innovators, informative newsletters, educational webcasts and videos, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM websites including PropertyCasualty360.com and Law.com.

Already have an account?

Meg Waters

Meg Waters

Meg Waters is the editor in chief of Treasury & Risk. She is the former editor in chief of BPM Magazine and the former managing editor of Business Finance.

More from this author

 

Recommended Stories

Treasury & Risk

Join Treasury & Risk

Don’t miss crucial treasury and finance news along with in-depth analysis and insights you need to make informed treasury decisions. Join Treasury & Risk now!

  • Free unlimited access to Treasury & Risk including case studies with corporate innovators, informative newsletters, educational webcasts, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM publications including PropertyCasualty360.com and Law.com.

Already have an account? Sign In Now
Join Treasury & Risk

Copyright © 2023 ALM Global, LLC. All Rights Reserved.