Japan Airlines Co. will raise some 300 billion yen ($2.7 billion) in capital later this month to strengthen its financial standing as air travel demand remains weak amid the coronavirus pandemic, sources close to the matter said Thursday.

The company could take out subordinated loans, which would allow the airline to count part of the debt as capital, while it also aims to secure funds to invest in green tech, the sources said.

JAL had raised around 180 billion yen last November through a public stock offering and other means to survive the pandemic and cover replacement costs for its fleet.

The company's capital adequacy ratio stood at 42.4 percent as of late June, a relatively high level among major global airlines, but JAL is planning to secure fresh funds as it expects a recovery in air travel demand could take time amid the prolonged COVID-19 pandemic, the sources said.

JAL's rival carrier, ANA Holdings Inc., the parent of All Nippon Airways Co., has also raised about 300 billion yen through measures such as a public offering.

While Japan continues to see a sharp fall in the number of international passengers amid strict border controls due to the spread of the highly contagious Delta variant, the situation may improve gradually with Tokyo issuing so-called vaccine passports to facilitate overseas travel from July.

As for domestic travel, the government is aiming to lift restrictions from around November, provided that people have been fully vaccinated or provide negative test results.

==Kyodo

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