Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2012

Fair Value Measurements

Schedule of assets and liabilities measured at fair value on a recurring basis

	Level 1		Level 2			Level 3		Counterparty Netting		Total
	(Dollars in thousands)
September 30, 2012
Derivative assets	$	—	$	70		$	—	$	—	$	70	(a)
Derivative liabilities		—		(23,910	)(b)		—		—		(23,910	)
Total	$	—	$	(23,840	)	$	—	$	—	$	(23,840	)
December 31, 2011
Derivative assets	$	—	$	198		$	—	$	—	$	198	(a)
Derivative liabilities		—		(31,756)	(b)		—		—		(31,756	)
Total	$	—	$	(31,558	)	$	—	$	—	$	(31,558	)

^(a)

Derivative assets are presented in Lease receivables and other assets on the Condensed, Consolidated Balance Sheet.

^(b)

The balance includes CVA and MVA adjustments of $0.6 million and $6.4 million as of September 30, 2012 and December 31, 2011, respectively.

Schedule of the effect on condensed, consolidated financial statements as a result of the non-recurring impairment charges and fair value adjustments recorded to flight equipment impaired

	Book Value at December 31, 2011		Impairment Charges			Reclassifications			Sales			Other Adjustments			Book Value at September 30, 2012
	(Dollars in thousands)
Flight equipment under operating lease	$	460,599	$	(190,721	)	$	(102,673	)	$	(22,562	)	$	(8,319	)(a)	$	136,324
Flight equipment held for sale		—		—			40,698			(626	)		(2,967	)		37,105
Lease receivables and other assets(b)		—		—			34,677			—			—			34,677
Net investment in finance and sales-type leases(c)		—		—			27,298			—			—			27,298
Total	$	460,599	$	(190,721	)	$	—		$	(23,188	)	$	(11,286	)	$	235,404

^(a)

Includes increases of $53,408 primarily related to the addition of an aircraft through the exercise of an option and an engine exchange transaction.

^(b)

Reclassification represents fair value of aircraft parts.

^(c)

Excludes measurement of finance and sales-type leases recorded at a gain.

Schedule of key elements effecting the fair value calculation

	Fair Value at September 30, 2012		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
	(Dollars in millions)
Flight Equipment(a)(b)		$159.0	Income Approach	Discount Rate	8.0%-14.5% (10.5%)
				Remaining Holding Period	0-9 years (2 years)
				Present Value of Non-Contractual Cash Flows as a Percentage of Fair Value	0-100% (32%)

^(a)

Includes Flight equipment for which non-recurring impairment charges and fair value adjustments were recorded during the three months ended September 30, 2012.

^(b)

Excludes measurement of finance and sales-type leases recorded at a gain.