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MINNEAPOLIS -March 7, 2003-The U.S. Bancorp Piper Jaffray Aircraft Finance Research Team recently initiated coverage of the aircraft asset-backed securities (ABS) sector, publishing the "Aircraft ABS Guide." The report is a comprehensive guide for investors during a time of great uncertainty for the sector.
"Over the past 18 months, aircraft ABS investors have endured a downturn of historic proportions with volatile lease rates, declining aircraft valuations and uncertain market conditions," said Joel Denney, director of Fixed Income Research for U.S. Bancorp Piper Jaffray. "Aircraft ABS transactions were structured to handle considerable stress, but no one could have predicted the events that precipitated the downtrodden environment that exists today. We believe this new environment makes the base case assumptions in aircraft ABS prospectuses obsolete, therefore one needs to reassess the ability of the pool of aircraft to generate enough cash flow to pay off the debt associated with it."
The "Aircraft ABS Guide" describes a methodology to look examine transactions in today's environment, and then tests the transactions using a standardized framework. In the report, Denney states that building a model incorporating current lease rates as well as future market lease rates provides investors with the ability to measure the level of risk for each tranche today. This model can also highlight relative value opportunities, as each transaction will perform differently under the same economic stresses. "Our model provides current investors with a market-based approach to assess current holdings and understand risk," said Denney.
For more information regarding the "Aircraft ABS Guide," please contact Joel Denney in the U.S. Bancorp Piper Jaffray Fixed Income Research Group at jdenney@pjc.com.

U.S. Bancorp Piper Jaffray, a subsidiary of Minneapolis-based U.S. Bancorp, is a focused securities firm comprised of three divisions: Equity Capital Markets, Fixed Income Capital Markets and Private Advisory Services. The firm provides a full range of investment products and services to individuals, institutions and businesses. The firm has over 120 offices in 24 states across the country. The Equity Capital Markets Division focuses on the needs of growth companies in the health care, technology, financial institutions, consumer and communications growth sectors. The firm has a national reputation for its expertise in fundamental research and equity and debt financing. The Fixed Income Capital Markets business provides bond issuers, individual investors and institutional investors expertise in investment banking, underwriting, trading, sales and research. The firm offers innovative solutions in corporate and government debt financings with particular expertise in corporate, health care/hospitals, real estate, higher education and government debt. The Private Advisory Services division financial advisors provide guidance in retirement planning, education planning, estate planning and wealth accumulation. Investors select from a wide array of products, including fee-based products, stocks, bonds, mutual funds, annuities, insurance and trust services. U.S. Bancorp offers a comprehensive range of financial solutions through U.S. Bank, U.S. Bancorp Asset Management, U.S. Bancorp Investments and U.S. Bancorp Piper Jaffray. For more information on U.S. Bancorp Piper Jaffray, visit www.piperjaffray.com.