Ethiopian Airlines, Citi sign a $450mln loan agreement for 5 new aircraft

Addis Ababa, December 19, 2023 (FBC) – Ethiopian Airlines, Africa’s largest carrier, today announced a landmark USD $450 million loan agreement that will finance five new Boeing aircraft: three Boeing 737-8 and two Boeing 777F (Cargo).

The loan, according to the Airline’s official press release, will be secured against the value of the five planes and has been arranged exclusively by Citi’s Corporate Banking and Export Agency and Finance teams. It is guaranteed by the Export-Import Bank of the United States (EXIM).

It is indicated that Ethiopian Airlines is a longstanding client of Citi’s Treasury and Trade Solutions (TTS) business, and their support and partnership have been instrumental to reaching the deal. Different parts of the bank, all working together, reflect Citi’s unique ability to offer different banking services to clients with cross border needs.

The USD $450 million loan is Citi’s largest aircraft financing in Ethiopia within the last decade and will help support both the bank’s bid to increase its footprint in the region, and the airline’s ambitious growth plan.

The five new aircraft will bolster Ethiopian Airline’s fleet to 150 in total and delivery of all the aircraft will be completed in the U.S. state of Washington in December. The new arrivals will help Ethiopian serve all its destinations by accelerating its expansion throughout the world and will further bolster Ethiopian Cargo & Logistics Services’ position as Africa’s largest cargo network operator. Ethiopian Airlines has ambitions to grow its fleet to over 270 aircraft by 2035.

Lauding the long-standing partnership of the two parties, Ethiopian Airlines Group CEO Mr. Mesfin Tasew said, “We are pleased to announce that we have reached an agreement with Citi to secure a USD $450m loan. This financing will allow us to expand our fleet size by adding five new aircraft, three B737-8 MAXs and two 777 Freighter. We are grateful for the mutually beneficial partnership we have established with Citi and look forward to further strengthening it. Fleet expansion being one of our strategic growth pillars, we will continue expanding and modernizing our fleet size so as to grow our business and reach new markets.”

Akin Dawodu, Citi Sub Saharan Africa Head, commented: “Citi has been serving Ethiopian Airlines for many decades, and we are pleased to support its growth with financing for five new aircraft. A lot of work has gone into getting this deal off the ground, and it is thanks to Citi’s strong relationships and connectivity both within the country and across our global network that we have been able to make it happen. Both our Banking and Treasury and Trade Solutions partners were instrumental in the delivery of this deal, and I would like to thank all teams for their collaboration.”

Citi has been working with Ethiopian Airlines for 45 years, supporting the airline’s treasury operations and working capital management in 27 countries across five continents. Citi’s unrivalled global network will continue to support Ethiopian Airlines’ expansion across Africa, Asia, the Americas, Europe and beyond.

Ethiopian Airlines, one of Africa’s most successful indigenous companies, plays a critical role in the country’s rapid economic growth by promoting tourism, facilitating import export of the country. Ethiopian has created Africa-wide and transcontinental networks flying to 135 international passenger and cargo destinations, including 63 African cities. On top of the belly hold capacity, Ethiopian Cargo & Logistics Services covers 67 dedicated Freighter services deploying 17 freighter aircraft.

The end of this year marks Citi’s 70th year working with Ethiopian clients. Commencing its activities in 1953, Citi remains the only, U.S. bank providing correspondent banking services to financial institutions in Ethiopia which enables Ethiopian corporates and persons to access U.S. dollars.

Ethiopia is one of Citi’s 63 hub-managed countries worldwide. Hub-managed countries are countries where Citi might not have a physical office, but it does have a strong, strategic presence and a wealth of expertise and talent to offer clients.

Citi is a preeminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in its home market of the United States. Citi does business in nearly 160 countries and jurisdictions, providing corporations, governments, investors, institutions and individuals with a broad range of financial products and services.