Citi Private Bank: Global aircraft lending for high-net-worth individuals

Citi Private Bank is an international lender with a specialist team in New York.

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With 90 offices, in more than 33 countries, Citi Private Bank prides itself on its global reach. The same is true for its aircraft finance team which is one of the few truly international business jet lenders. The key message from Mary Schwartz, head of aircraft finance in New York, is that the bank is just as keen to work with clients in Europe, Latin America or Asia as it is with ones in North America.

The team supports Citi Private Bank clients looking to finance aircraft or fractional shares. It will also advise on aircraft selection and fractional ownership.

“We are always happy to help clients decide on what they need. We often sit with them and discuss how often they fly and have advised clients not to buy but instead charter aircraft or use fractional ownership if it fits their needs better. Clients appreciate this honesty even if it means that we do not end up financing an aircraft,” says Schwartz.

Demand for aircraft finance has fallen in the last few years – both because of the economic downturn and perceptions of private jets – but Citi is starting to see a rise in interest. Historically most of its corporate jet business has been for US clients – where the private bank has over 20 offices alone – but Schwartz is seeing increased demand from international clients particularly in Asia and Brazil. “We have closed deals in Hong Kong, Singapore, Latin America, Middle East, Europe, India and Malaysia and are seriously looking at China now,” she says. Schwartz uses local offices and law firms to understand jurisdictions first so the bank can close deals as quickly as possible when clients contact them.

Citi Private Bank clients all work with individual private bankers when they first open accounts. While customers can call Schwartz directly, most deals come through private bankers whom bring in her team for advice when their clients are looking to finance aircraft. Citi Private Bank also has specialists offering a similar service in art finance. The bank uses local credit teams to understand clients and jurisdictions and make lending decisions quickly. Citi Private Bank says it has managed to arrange financing in fewer than two weeks for US clients.

The bank will help finance fractional shares and arrange pre-delivery financing if needed. It will also finance pre-owned aircraft and refinance aircraft that clients already own. Citi Private Bank’s minimum deal size is $5 million.

As the private bank is only focused on lending to high net worth individuals – holding assets worth over $25 million – it does not finance aircraft for charter operators or corporates. Although it focuses on the bank’s existing 25,000 clients the aircraft finance team will also help individuals the bank would like to have a relationship with.

Schwartz moved to the private bank nine years ago after specialising in asset finance at Citigroup corporate banking. “I worked on one deal for the private bank and then everyone started contacting me. It’s more fun than leasing.”