According to a stock market filing, Thai Airways International Plc has formally defaulted on a wide range of loans and debts, totaling approximately 98.5 billion baht (USD3.1 billion).
The first set of defaulted debts come from seven batches of debentures with a combined value of 85.1 billion baht (USD2.7 billion). The airline said it had received letters from holders of the seven batches between May 27th and July 9th, informing it of a formal default.
The amount represents around 34.7 percent of Thai Airways’ total liability as of the end of 2019. On December 31st of last year, the airline reported liabilities of 244.9 billion baht (USD7.7 billion).
Additionally, Thai Airways International Plc defaulted on a loan from the Thai Finance Ministry worth 12.2 billion baht (USD387 million). According to the documents, the Thai government had urged the loan repayment by May 22nd, 2020.
The repayment request came shortly after the airline lost its state enterprise status when the Ministry of Finance sold 3.17 percent of its stake to the state-owned Vayupak 1 Fund, taking its share in the airline below 50 percent.
Thai Airways also defaulted on two smaller loans according to the filing. The first is a one billion baht (USD31.6 million) loan from CIMB Thai Bank. The second is a 500 million baht (USD15.8 million) loan from the Islamic Bank of Thailand.
The airline stated that while it is aware and has received notices of all defaults, it will not try to settle debts until the bankruptcy reconstruction filing proceedings are completed. The filing at the Central Bankruptcy Court has put an automatic stay on all debts.
A hearing is scheduled for August 17th at the Central Bankruptcy Court in Bangkok.
Recently, Thai Airways announced that it had canceled all commercial flights in August. The airline has also received criticism from customers who have been informed that they will not receive ticket refunds for at least six months.