Capital in Motion: Structuring and Governing Finance for Aviation and Maritime Assets

Our experts

Ylva Cornelia Axelsen

Head of Capital Markets, Norway, CSC

Diederik de Jonge

Director of Business Origination EMEA, Trust and Agency, and Capital Markets, CSC

Paul Farrell

Associate Director, Trustee Services, Capital Markets, Ireland, CSC

Anne Flood

Head of Capital Markets, Ireland, CSC

Sven Haase

Senior Director of Business Origination EMEA, Trust and Agency and Capital Markets, CSC

Ian Hancock

Executive Director, Head of Capital Markets, Hong Kong, CSC

The capital behind global mobility

Aviation and maritime finance are among the largest and most established global markets for specialized assetbacked capital. They are deep, international, collateraldriven markets with large-ticket assets, liquid secondary markets, specialized lenders and lessors, capital markets structures, and institutional capital. While the assets differ, both sectors rely on long-term financing structures that must remain effective across multiple jurisdictions, market cycles, and regulatory changes while protecting investors and lenders when conditions change.

Both markets depend on continuous refinancing because the assets are long term, but the funding periods are shorter. In aviation, leasing plays a major role, and industry estimates describe large annual financing needs driven by continuous aircraft deliveries and fleet renewal. CSC’s Head of Capital Markets, Norway Ylva Axelsen notes that, “Commercial ships and aircraft may have an operating life cycle of more than 30 years whereas the financing itself will typically have a tenor of three to seven years. During the life cycle of a ship there will often be several refinancings and of course there is also a huge secondary market for trading in both assets and debt.”

Aviation and maritime finance highlights

Aviation and shipping finance primed for sustained growth

The global aviation finance market size reached $173.1 billion in 2024, reflecting robust activity across leasing, loans, and other financial instruments supporting the aviation sector. The market is projected to reach an estimated $277.7 billion by 2033, driven by the continuous expansion of global air travel, increased aircraft fleet modernization, and the rising adoption of innovative financing models.

Aircraft deliveries continue to lag behind demand, with the global backlog now estimated at approximately 17,000 aircraft, reinforcing long-term financing demand and sustaining elevated lease rates and asset values.

Petrofin estimates global ship finance at approximately $625 billion, spanning traditional bank lending, leasing structures, export credit, and alternative capital providers. Leasing is crucial to commercial aviation finance, with leased aircraft representing more than half of the global commercial fleet 3 , with lease terms ranging from short periods to more than a decade, while lessors manage key risks like airline credit, residual value, and remarketing when leases end.

According to IATA, global airline industry net profits are expected to reach approximately $39.5 billion in 2025 and should generate $41 billion in 2026.

The importance of leasing and alternative capital

In both aviation and maritime financing, the market has become more asset and security focused over time. In aviation, Anne Flood, head of Global Capital Markets, Ireland, points to a move back toward asset-backed structures, renewed use of finance leases, ABS, and institutional capital alongside more caution around sanctions, geopolitics, and airline credit. “Sanctions, export controls, and geopolitics have had a massive impact on airline financing. Transactions are further complicated by incorporating enhanced KYC sanctions compliance, jurisdictional risk buffers, and more robust legal opinions. Supply chain disruption has also kept aircraft values high and supply constrained.”

Ylva describes a parallel reordering in shipping, noting that traditional banks have stepped back, partly under climate-related portfolio pressures, and other financing sources such as private credit, lease structures, and bond markets have filled the gap with tailored, covenant-heavy structures. The common denominator is a broader shift toward structures that rely less on assumptions about market cyclicality and balance sheet lending and more on hard security, tighter controls, and documentation that can withstand rapid and unexpected changes in underlying fundamentals.

Growing role of non-bank capital

Across both aviation and maritime finance, non-bank capital is taking a larger role as traditional lenders become more selective and asset owners seek greater flexibility. In aviation, where leasing already supports more than half of the global commercial fleet, institutional investors are expanding funding capacity and speeding execution through leasing platforms and sale-and-leaseback structures. In shipping, bank lending remains important, but leasing and other non-bank funding sources are becoming more prominent. The result is a broader capital base, but also a shift in governance, as different providers bring different expectations around reporting, controls, and exit options.

Historical commercial aviation financing by channel, $billion (2016-2025)

Aviation financing volumes have fluctuated sharply over the past decade, reflecting changing delivery levels, capital market conditions, and extraordinary events such as the COVID-19 pandemic. Industry estimates indicate that aviation debt financing volumes reached historically elevated levels of approximately $276 billion in 2020 as airlines and lessors raised record liquidity through secured loans, capital markets issuances, governmentsupported facilities, and other emergency financings during the pandemic. By 2025, annual financing volumes had normalized to approximately $65 billion, reflecting lower aircraft delivery volumes, higher interest rates, and continuing Original Equipment Manufacturer (OEM) supply-chain constraints, although market conditions have gradually improved alongside recovering passenger demand and renewed lending and capital markets activity. Capital markets and commercial bank lending have continued to represent the majority of aviation debt funding throughout the cycle.

In shipping, Ylva notes that bank retrenchment has created a financing gap increasingly filled by private credit, direct lending, and a stronger bond market, often through more tailored and individually negotiated structures. “That has left a financing vacuum, which private credit has increasingly filled through direct lending and more bespoke, complex structures.” Ylva also notes there has also been a change in structuring and approach, as financing is now more individually negotiated.

“Norway’s bond market has for decades been an important source of capital for maritime companies, and those bonds are increasingly being structured more like traditional bank debt, with tighter covenants, security packages, and other lender protections,” Ylva adds. Overall, she says, maritime finance is evolving unevenly across segments, with sectors like offshore energy, container, and bulk being affected differently by geopolitical events like wars and trade tariffs, regulatory changes, and decarbonization pressures, but the direction is clear. Capital sources for the maritime industry, and how deals are being structured, are gradually being reshaped.

"One of the biggest shifts in shipping and offshore finance has been the withdrawal of traditional banks, largely because of climate and emissions requirements, increased geopolitical and security risks such as wars, sanctions and chokepoints, and geoeconomic risks like tariffs, trade fragmentation, and industrial policy."
-Ylva Cornelia Axelsen
Head of Capital Markets, Norway

When transaction assumptions meet commercial reality

Aviation and shipping may operate differently, but they share a core financing challenge: structuring around mobile, highvalue assets with tangible cash flow generation capabilities in ways that can endure long holding periods, multiple jurisdictions, shifting capital sources, regulatory change, geopolitical disruption, and rising compliance demands. In both sectors, closing is only the starting point; the real test is whether a structure can continue to function coherently as asset values, counterparty strength, and external risk conditions evolve over time.

Ylva says, “The market is deeply international, layered with sanctions, regulatory and contractual frameworks, and jurisdictional complexity, so financings must be able to function across wide set of legal and operational variables. The points of strain differ in form, but both sectors are vulnerable where mobility, cash flow timing, and legal complexity intersect.”

How financing structures break down under pressure

Both aviation and maritime financing structures may become impaired or require restructuring under stress when real-world operating conditions diverge from the model built at closing. In practice, long-life asset financings tend to be tested less by wholesale structural change than by how effectively stakeholders respond when conditions deteriorate, says Ian Hancock, executive director, head of Capital Markets, Hong Kong.

The pressure points are familiar across transport assets: delayed or missed payments, requests for lease extensions, asset redeployment, and the need to act quickly when enforcement or protective action is required. That’s why experience, speed, and informed agency matter. Ian notes, “Resilience doesn’t come from assuming risks can be fully predicted at closing, but from all parties understanding the asset and the market, and having the ability to make fast, disciplined decisions when circumstances change.”

The assumptions that prove most fragile are also notably similar. Ian notes that the greater risk is often not that parties made the wrong forecast, but that they could not fully foresee the event that would matter most, the pandemic, sanctions, airspace closures, lease repudiation, sanctions-driven repossession constraints, and crossborder enforcement delays. Residual value, maintenance cost and timing, airline credit, tax stability, interest rates, and regulatory change are also potential challenges.

In the shipping market, Ylva says, similar considerations are made when parties evaluate potential risks. The challenge is often to find the right balance between flexibility and predictability when structuring and documenting deals. Across both sectors, there’s a common theme: long-life asset finance is not undone only by poor underwriting, but by optimistic assumptions about stability itself. Structures become stressed when regulatory, geopolitical, or operational conditions evolve differently than the original documentation or economics anticipated.

In these scenarios, the effectiveness of the governance framework becomes critical. In our experience, the difference between a manageable situation and a valuedestructive outcome often lies in the quality of execution. Quality of execution requires efficient communication through experienced agents or trustees, clear procedures and instructions for decision making, and effective SPV governance maintained across jurisdictions.

Solid structure offers lenders confidence

What gives lenders and advisors confidence, is not simply the quality of the asset in isolation, but the resilience of the legal and governance framework around it. Anne says, “A structure holds up when it has a predictable legal environment, tested structural components, strong counterparties, and an asset that retains value. The aviation industry’s highly standardized documentation and reliance on global conventions—paired with decades of precedent—provides lenders and advisors a high degree of comfort.” She also stresses that durable jurisdictions and robust documentation reduce the risk of unpleasant surprises mid-transaction. Confidence comes from a well-managed operator with a credible track record, and experienced parties who understand how the structure behaves in practice.

Ylva notes that as financing sources diversify and are tailored to specific deals, structures increasingly need adapted covenants, enforceable security packages, and local execution capabilities across jurisdictions. In addition, the more diversified lender and investor landscape means bespoke intercreditor arrangements are increasingly important. Over time the asset and the supporting structure become inseparable. This is where experienced trustees, agents, and SPV providers make a measurable difference, particularly in preserving lender protections and maintaining structural integrity as conditions evolve. In stressed scenarios, the question may be whether the structure is strong enough to preserve asset value and lender options when events move against the deal. Both for borrowers and lenders, having a professional and experienced agent or trustee to manage communications, reporting, amendments and voting mechanics in complex financing structures is advantageous, in particular where unexpected events occur that call for rapid decisions.

This is why governance roles become more important as transactions age. Anne says, “Governance only increases in relevance over time, particularly in preserving bankruptcy remoteness, maintaining separateness covenants, and ensuring enforceability of security and cashflow waterfalls as operational, legal, and credit issues arise. At closing, governance matters such as ensuring security is perfected, filings are made, and collateral packages are enforceable are very important. And, establishing reporting standards, cashflow monitoring processes and covenant tracking from day one is critical.” Over time, those same mechanisms become the infrastructure through which a transaction is managed. Reserve sufficiency is tested, technical events are overseen, payment disruptions are handled, conflicts are managed, and enforcement pathways are preserved.

Ian adds that when payments fail or security must be enforced, the trustee or agent becomes most visible because action must be taken quickly and precisely. In a cross-border context local agents, security trustees, compliance, and filings across multiple jurisdictions are part of what keeps a structure functional. For long-life, mobile assets, these roles are not administrative add-ons. They are the continuity layer that allows the structure to keep working even if the original assumptions begin to fray.

What puts financing structures under pressure?

Shipping and aviation structures tend to come under pressure when the assumptions built into the original deal stop matching commercial reality. That could mean refinancing events, changes in asset values, shifts in operator or borrower credit quality, regulatory and sanctions developments, and wider geopolitical disruption. The long asset lives and crossborder use in these sectors add further strain because assets, counterparties, and legal risks can move across jurisdictions while the financing structure remains fixed.

Paul Farrell, associate director, Trustee Services, Global Capital Markets, Ireland recalls the impact of COVID-19 on the aviation industry, which led to an unprecedented global grounding of aircraft. “When aircraft aren’t flying and aren’t generating revenue for the lessee, the structure quickly comes under pressure. In many cases, lessors were required to enter lease amendments and agree to deferrals of lease payments, which further tested the robustness of aircraft leasing structures as lease receivables were delayed and defaults emerged.”

While pandemics, sanctions, and geopolitical events put financing structures to the test, Anne notes that “It’s usually more prosaic events such as delivery delays, maintenance events, lessee stress, redelivery, remarketing, and enforcement that distort expected cash flows in aviation.”

Ian underscores the point from the trustee and agency side, “The first visible breakdown is usually in payments, whether because the asset is not operating, the airline is delaying lease payments, or the underlying economics have weakened.”

How trustee, agent, and SPV mandates are shaped

Lender and adviser influence on formal appointments

In aviation and maritime transactions, the formal appointment of a trustee, agent, or SPV provider may sit with the borrower, but influence over that choice is often exercised elsewhere. Director of Business Origination EMEA, Trust and Agency and Capital Markets Diederik de Jonge notes that who influences the appointment of trustees, agents, or SPV providers in transactions is usually not clear cut. In practice, he says, lenders typically have the strongest voice, particularly where the role is tied to the protection of lender interests. “It’s peculiar, in that the party that will eventually be paying us is the borrower. But, especially in agency roles, we hold security rights for the lenders granted by the borrower. So, it is essentially the borrower that we contract with, but the appointment is more in the hands of the lenders than in the hands of the borrower.”

Sven Haase, senior director of Business Origination EMEA, Trust and Agency and Capital Markets adds, “A key reason the lenders are probably in the driving seat is that the law firms draft the documentation, the banks advise on the structuring side, and there are other advisors. There will also be key influencers depending on who has more experience in that particular transaction—they may be calling the shots.” The appointment of a provider often comes through advisers, particularly law firms, structuring banks, and financial advisers who help frame the structure, obtain quotes, and present options to decision-makers. The result is that these mandates are often a matter of lender comfort and adviser confidence.

CSC’s combination of deep aviation and shipping finance experience and consistently diligent execution is what sets the team apart. And our cross jurisdictional reach is one of the biggest assets we have—a client might be talking to Ian in Hong Kong, Ylva in Norway, Anne in Ireland, or one of our colleagues in the Americas. The reality of it is that we are incredibly agile across the globe.
-Paul Farrell
Associate Director, Trustee Services, Global Capital Markets, Ireland

Execution readiness is critical when appointment comes late

Selection of a provider often comes later in the transaction than might be expected. Appointments are commonly finalized once the financing structure, lender group, and execution timetable are already substantially in place. “The appointment of trustee or agent roles often occurs towards the end of the transaction because in many cases the work of putting a transaction together takes months, if not quarters, and sometimes up to a year, depending on how complex it is,” notes Sven. He says that by then, the need for an SPV, trustee, or agent is no longer theoretical; it’s a practical requirement for closing. The timing places a premium on execution readiness. Providers are often introduced into a process where the core documentation and commercial terms are already well advanced, so responsiveness, familiarity with deal mechanics, and the ability to integrate quickly become critical.

When advisers and capital providers assess potential providers, they usually prioritize proven capability over initial cost. The key considerations are typically sector expertise, execution capacity, and a demonstrable track record on comparable transactions. Aviation and shipping are both specialized financing environments, and decisionmakers place high value on providers that understand the underlying structures, the relevant counterparties, and the practical demands of managing these arrangements over time. Price is relevant, but rarely decisive on its own. More often, it functions as a threshold issue. The fee must be credible and commercially reasonable, but the primary concern is whether the provider can execute reliably and support the structure over its life. “The service itself is difficult to differentiate, so the track record of expertise associated with a certain sector is critical,” says Sven. “Decision-makers are looking for a partner that has worked on a number of transactions in shipping and aviation—that’s what helps them reach a decision.”

Where lender, advisor, and operator priorities converge

This is also where operator priorities most clearly converge with those of lenders and advisers. Across all three groups, there is a shared interest in providers that combine experience, dependable execution, practical judgement, and sufficient scale to support transactions across jurisdictions and over long asset lives. What clients ultimately value is confidence that the provider will not only help the transaction close but will remain effective when the structure begins to face real operational, legal, or commercial demands.

Control, clarity, continuity—why governance after closing matters

Governance matters after closing for the same reason it matters at origination. It preserves control when conditions shift. In long-dated aviation and shipping structures, Sven notes, “Good governance is for the vehicle to be in good standing from a compliance, tax, and regulatory perspective, that these things are squared off. Our role is to make sure that the client or sponsor has peace of mind with this over the course of the transaction. Yes, you need it at the beginning when you on board the transaction, review documents, and put teams together. But it’s critical over the life of the transaction.”

Diederik adds, “You may see mounting pressure in events of cash flow issues, defaults, or bankruptcies. And, specifically regarding shipping and aviation in the current climate, geopolitical, and regulatory issues can potentially create a variety of problems. For example, restraints due to sanctions, prohibited airspace or specific waters you can’t enter. For aviation and maritime financing deals this is relevant.”

Diederik makes the point that most issues can be managed, but the hardest problems arise when the core commercial terms of the deal start to break down. “Unexpected geopolitical shocks and their regulatory or operational consequences, as we noted previously, are particularly difficult because they sit outside the transaction’s control and cannot really be solved through the structure itself if not addressed in the transaction documentation.” Sven adds, “Ambiguity is especially problematic in stressed situations. When the documentation or instructions are unclear, agents and trustees lose the certainty needed to act cleanly within their mandate and risk being drawn into discretionary judgment—which we want to avoid at all costs.”

Having independent, professional directors on SPVs offers governance quality that lenders and rating agencies depend on by ensuring decisions align with fiduciary duties and not commercial bias, providing independence in enforcement or distressed scenarios, and ensuring clean separation of lessor or lender interests from SPV actions.
-Anne Flood
Head of Global Capital Markets, Ireland

Key governance roles in action

“Corporate services providers, trustees, and agents quietly carry a huge share of the operational, legal, and governance workload in aviation and maritime finance. When they do their job well, lessors and lenders barely notice them—which is exactly the point,” says Anne.

Post-closing developments often bring governance roles to the forefront, transforming them from behind-thescenes functions into critical pillars of order, fairness, and legal certainty. As circumstances evolve, these roles become indispensable in maintaining the integrity and function of financing structures.

Where amendments are required, SPV directors must understand the implications of what they are being asked to approve and sign.

Ensuring the validity and proper authorization of instructions, managing and facility agents administer agreements with precision and compliance.

Trustees operate within the terms of the documents while protecting the collective interests of secured creditors.

Providing a secure solution, escrow agents hold cash safely and securely on behalf of the escrow parties.

Built to perform over time

Aviation and shipping demonstrate that longterm asset finance is not defined at signing but shaped over time. The structures behind these transactions must remain credible through refinancing, market dislocation, regulatory change, counterparty stress, and geopolitical disruption. They must support refinancing, absorb market and regulatory change, and preserve lender protections as facts on the ground evolve. This is now the baseline expectation, not the exception.

For lenders, lessors, and investors, the question is not only whether a structure works at closing, but whether it will continue to perform under stress. That places increasing emphasis on governance, execution capability, and experienced counterparties.

CSC supports aviation and maritime transactions globally as SPV provider, trustee, agent, and independent director, bringing the technical expertise, jurisdictional reach, and execution discipline required to support structures over their full lifecycle while maintaining a balanced approach and strong ESG principles. For those structuring or refinancing transactions in these sectors, selecting the right governance partner is a critical component of long-term success.

If you are structuring or refinancing a deal, we would be pleased to share relevant transaction experience.