Saudi Arabian Airlines eyes bank loans

Saudi Arabian Airlines, the national carrier of the kingdom, plans to obtain loans from local banks to finance the purchase of Airbus and Boeing Co aircraft.“We are still in negotiations with aircraft manufacturers Boeing and Airbus for the purchase of 50 additional planes by the year end,” vice president of public relations Abdullah Al-Ajhar said Monday in a phone interview.“The airline is also in the process of beginning talks with local banks to secure loans for financing.” The carrier has also approached the government for funds, he said, declining to provide further details. Al-Ajhar said the airline has no plan to sell bonds or sukuk to raise money. Saudi Arabian Airlines said in July it had seen a 14 percent rise in passenger traffic in the first half of 2011, with the domestic market accounting for 65 percent of total flights. Khaled Al-Mulhem, director general of the airline, said the carrier had incurred heavy losses as a result of low-ticket fares for domestic flights, which he claimed had not increased for 16 years. From / Arabian Business News