S&PBULLETIN: AerCo Ltd. Bears Aircraft Industry Woes.

Business Editors

LONDON--(BUSINESS WIRE)--March 28, 2002

Prevailing woes in the global aviation industry have meant that several aircraft lease rental rates in the portfolio of AerCo Ltd. have been re-negotiated, and that other leases negotiated recently have realized depressed

Of the 61 aircraft in this transaction, 15% by appraised value (as at February 2002) are due to be re-leased before March 2003 and thus are exposed to likely weak market conditions. The class D2 notes in this transaction are considered the most vulnerable to any adverse changes in performance. All aircraft in the portfolio are, however, currently on-lease with airlines and, as a whole, are achieving relatively strong revenue. Standard & Poor's considers that no rating action is warranted at this time, although the class D2 notes will remain on CreditWatch with negative implications. The class D2 notes can draw on a liquidity facility, which is currently $55.2 million. AerCo's aircraft portfolio is diverse and consists mostly of widely used narrowbodies, though it includes very few of the most desirable current generation of popular Airbus and Boeing narrowbody planes. The credit quality of the current airline lessors is considered average for an aircraft lease portfolio securitization.

OUTSTANDING RATINGS ON CREDITWATCH WITH NEGATIVE IMPLICATIONS
AerCo Ltd.
Class D2                  BB/Watch Neg

Copyright 2002, Standard & Poor's Ratings Services