Malaysia Airlines defers payments on $492 million Islamic bonds

Malaysia Airlines has struggled financially even before the outbreak.
Malaysia Airlines has struggled financially even before the outbreak.PHOTO: AFP

KUALA LUMPUR (REUTERS) - Malaysia's national carrier has deferred by six months payments to holders of RM1.5 billion (S$492 million) in Islamic bonds, CIMB Investment Bank, the facility agent, said.

In a notice on a central bank website, CIMB Investment Bank said Malaysia Airlines issued deferral notices last week on periodic distribution amounts due on Sept 30 for RM1.5 billion nominal value unrated perpetual sukuk musharakah.

Payments will resume at the next periodic distribution date on March 31 next year, it added in the notice, filed on Tuesday (Sept 22).

The global coronavirus pandemic has hit airlines hard, with nations shutting borders as a precaution, bringing travel almost to a grinding halt for months.

Malaysia Airlines, which had struggled financially even before the outbreak, said in April it had made cost cuts and was working with sole shareholder Khazanah Nasional for support to ride out the crisis.