Japanese operating lease products (JOLCO * 1, JOL * 2) for Japanese SME's
We sell investment products to Japanese corporations. Our products are generally known as "Japanese operating leases" which combines a form of silent partnership stipulated by the Japanese Commercial Code with operating lease.
[Overview of Japanese Operating Leases]
Investors will invest in the operating lease business of investment products such as aircraft and take on the business profits and losses during the lease period. This enables the efficient use of funds. There is also the possibility of capital gains by selling the leased property at the end of the lease period.
- *1
- JOLCO (Japanese Operating Lease with call option)
JOLCO is an operating lease which gives the lessee an option to purchase the asset at the end of the lease, or at some point during the lease period, at the purchase price determined at the commencement of the lease.
- *2
- JOL (Japanese Operating Lease)
JOL is an operating lease funded by the equity investment from Japanese investor(s) and non-recourse debt from financial institution(s). This structure is used mainly in the aviation industry to provide airlines with 100% financing of aircraft. The lease rates are competitive and attractive for airlines. The equity investor(s) will enjoy tax benefits from the JOL structure and exposed to the residual value risk at the end of the lease. Therefore, the JOL should be structured by the experts of aircraft leasing in order to minimize the residual value risk.
[Main structure diagram of Japanese Operating Leases]
