• Cebu Pacific has secured a sustainability-linked loan to fund its decarbonization initiative and fleet expansion, the first low-cost carrier in Southeast Asia to secure the deal
• The deal was arranged by Crédit Agricole CIB and structured as a Japanese Operating Lease with Call Option
• It supports the airline’s fleet modernization program aimed at transitioning to more advanced and fuel-efficient aircraft, according to Mark Cezar, CEB’s chief financial officer
• Proceeds from the SLL financed the acquisition of an Airbus A321neo, delivered in late 2024
Cebu Pacific (CEB) secured a sustainability-linked loan (SLL) to fund its decarbonization initiative and fleet expansion, the first low-cost carrier in Southeast Asia to secure the deal.
The deal was arranged by Crédit Agricole CIB and structured as a Japanese Operating Lease with Call Option (JOLCO).
While the loan amount was undisclosed, it mandates the Gokongwei-owned airline to meet specific performance targets tied to decarbonization, offering financial incentives upon achieving these goals.
“Cebu Pacific’s first sustainability-linked aircraft financing is a milestone in our decarbonization journey, as the transaction supports the core element of our program—the modernization of our fleet towards more advanced and fuel-efficient aircraft,” Mark Cezar, CEB’s chief financial officer said in a statement.
“With this deal, we want to emphasize that access to financing for sustainability initiatives is available and that Cebu Pacific is taking full advantage of such opportunities in our pursuit of being the decarbonization leader in the region,” said Cezar.
The first use of the loan was to finance the acquisition of an Airbus A321neo, delivered in December 2024. The SLL supports the carrier’s fleet modernization program, aiming for an all-new engine option (NEO) fleet by 2028.
Airbus NEOs are the latest-generation aircraft that burn 15% less fuel per flight and produce less noise compared to the previous generation. The reduction in fuel consumption leads to a corresponding reduction in aircraft carbon emissions.
The airline’s push toward sustainability extends beyond aircraft upgrades. CEB received 17 aircraft in 2024, expects seven more in 2025, and has signed a firm order for 152 planes with Airbus valued at $24 billion, the largest order in Philippine aviation history.
READ: Cebu Pacific Air ends 2024 with 17th aircraft delivery
Crédit Agricole CIB, the investment banking arm of Crédit Agricole, acted as the sole advisor, JOLCO arranger, and lead arranger for the deal. The bank expressed confidence that the SLL would be the first of many for Cebu Pacific, which is positioning itself as a leader in sustainable aviation in Southeast Asia.
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