Institutional Leasing via MT760 – Cash-Backed – High-Grade Rated
At AOL INC. LTD, we offer institutional clients access to seasoned, high-rated debt instruments—specifically Bonds and Medium-Term Notes (MTNs)—for the purpose of financial structuring, balance sheet reinforcement, and credit enhancement. These instruments are leased (not sold or monetized) under legally binding agreements and are assigned exclusively via SWIFT MT760, with issuance performed by a pre-approved pool of top-tier international banks.
The instruments selected for leasing are seasoned securities, typically within 13 to 16 months of maturity. Their market value has stabilized over time, allowing for consistent performance, minimized volatility, and reliable pricing. We focus only on instruments rated between A- and AAA, ensuring that each lease transaction is grounded in real creditworthiness and market liquidity.
A seasoned bond is a fixed-income security that has already been issued and actively traded on the secondary market for a sufficient period. This extended trading history ensures that the bond’s market value is well-defined, reducing price uncertainty and risk at the time of leasing. Bonds selected by AOL INC. LTD typically have a remaining maturity ranging between 13 and 16 months, aligning with institutional planning horizons and offering high visibility into return parameters.
From a practical standpoint, leasing such a bond enables a company to temporarily enhance its asset base, strengthen its financial ratios, or provide documentary proof of asset backing for purposes such as project finance, investor relations, or structured debt packaging.
Each bond is assigned via SWIFT MT760, and—similar to all instruments issued through our network—the text of the swift does not include operational terms. All legal conditions and return obligations are codified exclusively in the Lending Agreement. The bonds maintain realizable value typically between 95% and 105% of their face value and are considered fully cash-backed by the issuing institutions.
The leasing fee applicable to each Bond or MTN is typically determined in relation to the annual coupon rate of the instrument and generally ranges between 6.00% and 8.00% of the face value. However, due to the current exceptional macroeconomic and geopolitical context, all bank instruments leased through AOL INC. LTD are subject to a standardized leasing fee of 6.00%, frozen until June 30th, 2025. After this date, the applicable fee structure may be reviewed and adjusted in accordance with prevailing market conditions, interest rate dynamics, and global risk indicators.
An upfront administrative and reservation fee—commonly referred to as the Call Option Fee—is required to initiate the reservation of the selected financial instrument on the secondary market. This fee is not an additional cost but a recoverable operational advance.
It can be recovered in two distinct ways:
Immediate deduction: The amount is deducted directly from the conditional payment of the leasing fee, meaning the borrower pays the leasing fee net of the Call Option previously transferred.
Full refund: If the leasing fee is paid in full without deduction, the Call Option amount is refunded in full upon successful assignment of the instrument via SWIFT MT760.
In both cases, the administrative and reservation fee is fully recoverable, ensuring that the borrower incurs no net cost if the transaction is completed in accordance with the procedure.
Medium-Term Notes (MTNs) represent a flexible form of corporate or institutional debt instrument, generally with maturities between 5 and 10 years. The instruments we lease are seasoned MTNs, selected approximately 15 months prior to maturity, and exclusively issued by reputable, regulated banks. The “medium-term” nature of the underlying instrument refers to the original tenor, whereas the leasing timeline typically coincides with the final year or so of the instrument’s life, at which point the pricing and performance characteristics are well established.
Unlike bonds, which are often standardized and exchange-traded, MTNs offer more flexibility in structuring and issuance. They are typically issued under debt programs that allow the originator (usually a bank or large corporation) to customize cash flows, issuance terms, and investor alignment. Leasing a seasoned MTN enables a borrower to present the instrument as a temporary balance sheet asset for legitimate purposes such as collateral structuring, financial statement enhancement, or regulatory compliance.
All MTNs offered by AOL INC. LTD are fully rated between A- and AAA, with verifiable ISINs and issuance histories. The delivery method remains consistent with our bond protocol: assignment via MT760, with terms excluded from the swift and entirely contained within the Lending Agreement. Leasing fees follow the same schedule as bonds—6.00% until 30.06.2025, and adjustable thereafter, as previously explained.
The upfront reservation fee required for MTNs follows the same recovery logic previously described for Bonds: it is fully recoverable either through immediate deduction from the conditional leasing fee payment, or as a full refund upon successful assignment of the instrument via SWIFT MT760. This ensures that, as with Bonds, no additional net cost is incurred by the Borrower when the transaction is completed in accordance with the standard procedure.
Both Bonds and MTNs are leased—not sold or pledged—and no ownership rights are transferred to the Borrower. Instruments are provided exclusively for use as temporary financial enhancement under contractual terms that mandate their full return, unencumbered and lien-free, no later than 15 days prior to maturity.
The delivery via SWIFT MT760 guarantees institutional-grade traceability and security. The swift message includes no embedded clauses, ensuring operational clarity and preventing conflicting interpretations between issuing and receiving banks. The Lending Agreement, executed between AOL INC. LTD and the Borrower, defines all legal obligations, return conditions, penalties for misuse, and compliance frameworks, including KYC/AML provisions.
The leasing of Bonds and MTNs provides a non-dilutive, legally codified solution for institutions seeking temporary asset structures without assuming long-term debt obligations or equity loss. These instruments are particularly effective in preparing for capital market operations, strengthening equity buffers, supporting project finance submissions, and satisfying regulatory or investor disclosure standards.
It is important to emphasize that AOL INC. LTD does not engage in the monetization or trading of leased instruments. Any such initiative must be independently arranged by the Borrower with third-party institutions, at their sole risk and legal responsibility.
By selecting seasoned, investment-grade, cash-backed debt instruments, AOL INC. LTD offers corporate clients a secure and professional gateway to advanced financial structuring.
For institutions that demand predictability, compliance, and credibility, leasing Bonds and MTNs through our platform offers an intelligent alternative to traditional capital structuring methods—without the complications of dilution, ownership transfer, or speculative exposure.