Insurers bulked up on airline risk as export credit agencies pulled out

(Global Capital, London, 2 April 2020) Private sector insurance companies have written extensive guarantees for the purchase of new aircraft from Boeing and Airbus in the past two years, filling a gap in the market left by the retreat of US Eximbank and European export credit agencies. But with aircraft around the world grounded and airlines slashing capital expenditure, these insurance firms could be stuck with the risk. The Airbus CEO told employees last week that the company’s survival was in question without immediate action and told RTL Radio that there was a need for export financing support. Export credit agencies played a key role in keeping deliveries moving during the 2009 financial crisis, but their role has since diminished. European nations withdrew their support during most of a four-year corruption investigation culminating in a record 3.6-billion-euro fine against Airbus in January.