S&P: BOC Aviation notes BBB-

Standard & Poor's said it assigned a BBB- long-term rating to a proposed dollar-denominated issue of senior unsecured notes by BOC Aviation Pte. Ltd. under the company's $5 billion euro medium-term notes program.

The rating is one notch below the corporate credit rating on BOC Aviation because the company's total secured debt exceeds the notching threshold of 20% of total assets, S&P said.

The proceeds for will be used for capital spending and general corporate purposes, the agency said.

The ratings reflect the company's good cash flow stability from long leases, sound competitive position and support from its 100%-owner, Bank of China Ltd., S&P said.

Tempering these strengths is BOC Aviation's moderately higher leverage than other rated peers, along with the company's exposure to the industry's cyclical demand and aircraft-lease rates, the agency said.

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