Government draws line under Swissair credit
The government says the public purse is now closed to Swissair, after it extended a SFr450 million ($277 million) emergency credit to help the airline continue its operations until the end of the month.
The finance minister, Kaspar Villiger, said on Friday that the government had no plans to increase the credit, which it granted on Wednesday night. Most of the money was to have been paid out by the end of Friday.
Swissair was put under temporary creditor protection on Friday until December 5 by a commercial court in Zurich, paving the way for the government's emergency loan to be transferred to the airline.
The emergency credit is aimed at keeping the airline operational until October 28, when most of Swissair's flights are due to be transferred to its former subsidiary, Crossair. The government stumped up the money after the airline was forced to ground its entire fleet on Tuesday amid a cash crunch.
However, Villiger said the government was willing to do what was necessary to ensure the smooth transition from Swissair to Crossair. The government set up a task force to coordinate the transition.
There has been speculation that the money provided by the Swiss government might not be sufficient to keep the Swissair fleet in the air. But Morten Heerholdt, an airline analyst at Barclays, told swissinfo that it should last until the end of the month.
The president, Moritz Leuenberger, who is also transport minister, pointed out the cabinet unanimously agreed on a proposal put forward by the banks for the future of Swissair. He said the only realistic option was for Crossair to take over Swissair's flight operations and some flight-related services.
The country's two main banks, UBS and Credit Suisse, have offered to take over 70 per cent of the new Crossair. The Swissair Group was placed in receivership with debts of over SFr17 billion. The move will lead to at least 4,000 job cuts.
The government called on the banks to help soften the impact of the redundancies and pledged to play its part. It added that it is up to employers and trade unions to negotiate conditions for pay offs.
In a conciliatory gesture, Leuenberger made an appeal to stop the hunt for scapegoats in the Swissair crisis. He said it was time for business leaders to consider possible political and social implications of their decisions, but politicians also had to act more in the spirit of entrepreneurs.
The statement came after Leuenberger openly expressed his anger at the bank's handling of the Swissair crisis earlier this week. There have also been protests in several Swiss cities against the banks.
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