FILE PHOTO: Korean Air’s passenger planes are parked on the tarmac as overseas flight routes are reduced following the outbreak of coronavirus disease (COVID-19), at Incheon International Airport in Incheon, South Korea, March 24, 2020. REUTERS/Heo Ran/File Photo
April 24, 2020
SEOUL (Reuters) – Two state-owned banks in South Korea said on Friday they would provide up to 1.2 trillion won ($971 million) in liquidity to support Korean Air Lines Co Ltd <003490.KS> as the aviation industry reels from the coronavirus crisis.
The country’s biggest carrier has been hit hard by the pandemic as it struggles to deal with plummeting passenger demand.
Korea Development Bank (KDB) and Export-Import Bank of Korea will provide the liquidity in the form of loans, a Korean Air official confirmed.
Earlier this month Korean Air said 70% or more of its employees working in South Korea would take a six-month leave of absence as part of the carrier’s efforts to overcome operational difficulties resulting from the coronavirus pandemic.
The banks’ move follows their decision to provide up to 1.7 trillion won in fresh liquidity to the country’s second-largest carrier, Asiana Airlines, <020560.KS> earlier this week.
The transport ministry, financial regulator and state-run Korea Development Bank had also announced, in February, that they would extend up to 300 billion won ($251.55 million) of liquidity to domestic budget carriers because of the crisis.
(Reporting by Heekyong Yang and Joyce Lee; editing by Susan Fenton, Philippa Fletcher)