Hong Kong Airlines’ owner secures $568 million loan.
HNA Group has secured a $568 million loan from state-owned banks ensuring Hong Kong Airlines stays operational for now.
The lead bank in the HK$4.4 billion loan is China Development Bank, which has been overseeing HNA’s restructuring. The loan term is three years with a 4.75% interest rate.
The airline has said it will use the cash injection to pay wages, airport charges, fuel and aircraft lease payments.
Last week, Hong Kong Airlines reportedly failed to pay almost half of its staff on time.
Approximately 40% of the workforce will have to wait until December 6 to receive their November payslip.
As a consequence, the Air Transport Licensing Authority (ATLA) had delivered an ultimatum to the carrier that a failure to find new cash could lead to the suspension or even termination of its operating licence.
In a bid to cut costs, Hong Kong Airlines announced that it will be cutting several routes from its network, including all flights to North America from February 2020.
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