Singapore Airlines confirmed it had hired banks to explore a deal, without commenting on its potential size.

The airline said, in an emailed response to Reuters, that it had mandated Citigroup Inc and DBS to lead the transaction, and BNP Paribas as well as Standard Chartered to be book runners.

"If we go ahead with the bond issuance, the proceeds will be used for general purposes including capital expenditure and refinancing of existing borrowings," it said in the statement.

The deal is classified as Reg S, which means the bonds can only be purchased by investors outside of the United States.

If the deal proceeds, it will be the second dollar bond that Singapore Airlines has issued after its first transaction of the kind raised $500 million in January last year.

Travel-related deals remain popular among investors, despite the COVID-19 pandemic still taking a heavy toll on the industry.

Hong Kong's Airport Authority last week raised $4 billion in U.S. dollar bonds which attracted $11.5 billion worth of demand from investors.

In late December, Singapore's government said it had frozen new ticket sales under its vaccinated travel lane programme until Jan 20.

(Reporting by Scott Murdoch in Sydney and Anshuman Daga in Singapore; Editing by Muralikumar Anantharaman, Ana Nicolaci da Costa and Himani Sarkar)

By Scott Murdoch and Anshuman Daga