On May 19, 2015, Minsheng Royal Asset Management-Herald Leasing No. 1 Huifu ABS, the first lease-backed securitization product of Herald International Financial Leasing Co., Ltd. (“Herald Leasing”) was successfully issued, raising RMB430mln. Minsheng Royal Asset Management Co., Ltd. acts as manager and Dacheng provides legal counsel for the ABS program.
The Dacheng team which included Beijing-based of council Wang Lihong, partner Han Jing, attorneys He Yuhua, Xu Yuxing, Sun Chao, Lv Xiaxi, Zheng Wenjing, and Tong Jiali provided a number of critical legal solutions on product structuring. The successful offering of the first lease-backed ABS by Herald Leasing shows that more and more financial lease companies are diversifying their financing channels by resorting to innovative structured products.
The product in question has the following characteristics: 1) sufficient credit enhancements: the securities are split into tranches (senior (“A”,”B”) classes and subordinated classes) and are secured by deficiency payments by the originator; 2) complete risk isolation and mitigation, in aspects such as the redemption of underlying assets, transfer payment mechanism of recoveries, rights protection measures, and repayment acceleration mechanism; and 3) quality and highly dispersed underlying assets.
Herald Leasing is a foreign-owned leasing company established in 2009 with approval from the Commerce Commission of Tianjin, PRC. It is owned by China Auto Leasing (Hong Kong) Company Limited. It is engaged in financing lease, operating lease, purchase of assets for lease at home and abroad, residual value treatment of leased assets and their maintenance, lease-related consulting and guarantee.
Beijing Dacheng Law Offices, LLP ("大成") is an independent law firm, and not a member or affiliate of Dentons. 大成 is a partnership law firm organized under the laws of the People’s Republic of China, and is Dentons' Preferred Law Firm in China, with offices in more than 50 locations throughout China. Dentons Group (a Swiss Verein) ("Dentons") is a separate international law firm with members and affiliates in more than 160 locations around the world, including Hong Kong SAR, China. For more information, please see dacheng.com/legal-notices or dentons.com/legal-notices.
