Saab removes its risk in regional aircraft lease portfolio

Saab announces a Financial Risk Insurance Program which will isolate the
performance of its existing portfolio from future risk and volatility in
the regional aircraft market

The insurers are a consortium of highly rated international insurance
companies. Income guaranteed through insurance is USD 1,170 m. after
deduction of a 10 % first loss borne by the insured. The transaction cost
is USD 43 m. after tax and is covered by current provisions.

The Saab aircraft lease portfolio consists of 302 Saab 340 and Saab 2000
aircraft on lease with 30 airlines world-wide. The insurance policy covers
203 Saab 340 and Saab 2000 aircraft. The 99 Saab 340 aircraft not included
in the policy represent minimum exposure for Saab since 57 are funded with
non-recourse long term loans and 42 are covered by asset value insurance
issued by EKN, the Swedish government agency for Export Guarantees.

The policy secures the deemed lease income for the 203 aircraft during the
coming 15 years from market cycles, competition, obsolescence and customer
default. The market value of the portfolio's contracted and expected lease
income and the associated financing outflow obligations balance with the
present provision.

The insurance policy has been implemented under the leadership of BAE
SYSTEMS using MMC Enterprise Risk, an operating entity of Marsh & McLennan
Companies (MMC) as the insurance broker. The policy is based upon the
Financial Risk Insurance Program entered into in 1998 by BAE SYSTEMS for
its regional aircraft portfolio.

Saab will continue to manage the placement of its regional aircraft
portfolio to enhance shareholder value by minimizing its first loss
position and also by maximizing income.

Bengt Halse, CEO of Saab, said: - "Whilst we believe we have adequately
provided against the downside risk for our regional aircraft, recognizing
the time scales over which this activity must be assessed, and the
cyclicality of this activity it is prudent to draw a line under our
exposure in this way. Our focus is on enhancing income from the Saab fleet
and servicing our customer needs, thus delivering added value to our
shareholders."

Peter Sandehed, Senior Vice President Corporate Treasury, said: - "This
strengthens Saab's financial position by virtually eliminating the
downside risk from the fleet of regional aircraft, and takes away the
uncertanities around the valuation of the leasing portfolio."

Peter added: - "We are pleased to have worked with BAE SYSTEMS and MMC
Enterprise Risk as our advisors as well as with our lead re-insurers -
Winterthur International Strategic Risk Solutions, Swiss Re New Markets,
Mitsui Marine International and AMBAC - to achieve this highly innovative
approach to managing aircraft risk using the international insurance
markets."

Saab is northern Europe's leading high technology company, mainly active
in the defense, aviation and space industry, and offers advanced products
and systems based on sophisticated information technology. The business
areas within Saab are Infomatics, Aerospace, Dynamics, Technical Support
and Services, Space and Aviation Services.

For further information please contact:
Peter Sandehed, Senior Vice President Corporate Treasury tel. +46 13 18
21 12
Agneta Kammeby, Manager Investor Relations tel. +46 13 18 71 25


www.saab.se

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