China Aircraft Leasing Hldgns : VOLUNTARY ANNOUNCEMENT - REALISATION OF FINANCE LEASE RECEIVABLES

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CHINA AIRCRAFT LEASING GROUP HOLDINGS LIMITED

中 國 飛 機 租 賃 集 團 控 股 有 限 公 司

(Incorporated under the laws of the Cayman Islands with limited liability)

(Stock code: 1848) VOLUNTARY ANNOUNCEMENT REALISATION OF FINANCE LEASE RECEIVABLES

The Board is pleased to announce that on 23 June 2017, each of the SPCs, a wholly-owned subsidiary of the Company, completed the Realisation Transaction with the Trust respectively in relation to each of the five Aircraft under the respective Aircraft Lease Agreement and the Company recorded a gain on disposal of the FLR.

The Realisation Transaction has constituted a recurrent business of the Group, enabling more efficient use of the Group's equity and debt financing arrangement. Such business model enables the Group to expand its business without relying too much on equity growth. The Realisation Transaction again demonstrates the Group's continued innovation on its rental realisation products which advances the aviation finance sector of the nation, while further cementing the Group's already-diversified financing channels and enhancing its capital liquidity.

The announcement is made on a voluntary basis by the Company.

REALISATION OF THE FLR

The Board is pleased to announce that on 23 June 2017, each of the SPCs, a wholly-owned subsidiary of the Company, completed the Realisation Transaction with the Trust respectively.

Pursuant to the FLR Transaction Documents, each of the SPCs agreed to sell and the Trust agreed to purchase the FLR in relation to each of the five Aircraft under the respective Aircraft Lease Agreement.

REASONS FOR AND BENEFITS FROM THE REALISATION OF THE FLR

The Group is principally engaged in aircraft leasing business. The Realisation Transaction has constituted a recurrent business of the Group, enabling more efficient use of the Group's equity and debt financing arrangement. Such business model enables the Group to expand its business without relying too much on equity growth. The Realisation Transaction again demonstrates the Group's continued innovation on its rental realisation products which advances the aviation finance sector of the nation, while further cementing the Group's already-diversified financing channels and enhancing its capital liquidity.

As at the date of this announcement, the Group completed realisation for eight aircraft in total (including the five Aircraft under this Realisation Transaction) since 1 January 2017.

THE FINANCIAL EFFECTS OF THE REALISATION OF THE FLR

The following sets forth the financial effects of the realisation of the FLR upon its completion on 23 June 2017:

1. The Group transferred substantially all the market risks and rewards of ownerships on the future lease receivables to the Trust being the purchaser of the FLR and hence, the FLR relating to lease payments was de-recognised.

2. The total consideration for the assignment of the FLR was received by the Company in cash and the Company recorded a gain on disposal of the FLR.

3. The consideration received will be partly used to prepay the borrowings in relation to the Aircraft, thus reducing the Group's gearing ratio.

4. For clarification purpose, each of the SPCs still retains the ownership of the Aircraft.

DEFINITIONS

In this announcement, the following expressions shall (unless the context otherwise requires) have the following meanings:

"Aircraft" each of the five Airbus A320CEO series aircraft whose legal owner is the respective SPC

"Aircraft Lease Agreement" each of the five aircraft lease agreements entered into by the

respective SPC (as lessor) with the respective airline customer (as lessee) for the lease of the Aircraft

"Board" the board of directors of the Company

"Company"China Aircraft Leasing Group Holdings Limited (中 國 飛 機 租 賃 集 團 控 股 有 限 公 司), an exempted company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange

"FLR" the finance lease receivables under each of the Aircraft Lease Agreement, calculated from 23 June 2017 to the end of the lease term (both days inclusive)

"FLR Transaction Documents" the FLR assignment, the aircraft mortgage, the insurance

assignment and other ancillary documents, all entered into on 23 June 2017

"Group" the Company and its subsidiaries "Hong Kong" the Hong Kong Special Administrative Region of the PRC

"PRC" The People's Republic of China, excluding Hong Kong, the Macau Special Administrative Region and Taiwan for the purpose of this announcement

"Realisation Transaction" the transactions in relation to the entering into of the FLR

Transaction Documents

"SPC(s)" each of the five special purpose companies established in the PRC with limited liability and is an indirect wholly-owned subsidiary of the Company

"Stock Exchange" The Stock Exchange of Hong Kong Limited

"Trust" the trust which is the assignee named in FLR assignment and the trust will further assign the FLR to connected persons of the Company

By order of the Board

China Aircraft Leasing Group Holdings Limited POON HO MAN

Executive Director and Chief Executive Officer

Hong Kong, 23 June 2017

As at the date of this announcement, (i) the Executive Directors are Mr. CHEN Shuang, Mr. POON Ho Man and Ms. LIU Wanting; (ii) the Non-executive Directors are Mr. TANG Chi Chun, Mr. GUO Zibin and Ms. CHEN Chia-Ling; and (iii) the Independent Non-executive Directors are Mr. FAN Yan Hok, Philip, Mr. NIEN Van Jin, Robert, Mr. CHEOK Albert Saychuan and Mr. CHOW Kwong Fai, Edward, JP.