JAL Mulling Securing Quasi-Capital Funds

Economy

Tokyo, Oct. 26 (Jiji Press)--Japan Airlines <9201> is considering procuring quasi-capital funds in case its earnings deterioration continues due to the novel coronavirus pandemic, it was learned Monday.

The airline will discuss details, including the amount it would raise, with banks while monitoring passenger demand, informed sources said.

Specifically, JAL will study the possibility of receiving subordinated loans, part of which can be counted as capital, to reinforce its financial base, according to the sources. The issuance of subordinated bonds could also be an option, the sources said.

JAL is expected to report some 200 billion yen in consolidated loss from its core operations for the April-September first half of fiscal 2020, and a major loss seems unavoidable also on a full-year basis. JAL is set to announce its first-half results on Friday.

Having already secured 500 billion yen, including a credit line agreement with banks, the airline is unlikely to face a funding problem for the time being.

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Jiji Press