(Yicai Global) June 9 -- Shandong Airlines will ask China Development Bank, one of the country’s policy banks, to give it an emergency loan worth as much as CNY2.6 billion (USD407 million) after the regional carrier ran up big losses as a result of the global pandemic.

Shandong Airlines plans to use the one-year loan for operating expenses, the Jinan-based company said in a statement yesterday, adding that it will not involve a mortgage nor pledged stock or assets. The interest rate, guarantee type and repayment method will be subject to final contract.

The carrier reported a CNY835 million (USD130.5 million) loss in the first quarter of this year, up CNY240 million from the same period last year, after losing CNY2.4 billion (USD376 million) in 2020. Debt totaled CNY34.7 billion (USD5.43 billion) at the end of the first three months of 2021, with its debt-to-assets ratio widening to nearly 100 percent, from 89 percent at the end of 2020.

Except for China Express Airlines, which received a CNY638 million government subsidy, all the other 11 listed airline operators were in the red. Some small regional carriers such as Heilongjiang province’s Longjiang Airlines and Yunnan province’s Ruilin Airlines have even changed hands because of the pandemic.

Shares of Shandong Airlines [SHE:200152] fell 0.9 percent today to CNY4.25 (67 US cents) each, after gaining 1.4 percent yesterday.

Editor: Futura Costaglione