DIA In Trouble? Banks Refuse To Back Bonds
Shaky Financial State Of United Puts DIA At Risk
POSTED: 6:57 a.m. MST February 6, 2002
DENVER -- Several international banks have refused to
provide Denver International Airport with a letter of credit
backing $52 million in bonds, in part because of the shaky
financial state of United Airlines, its largest carrier, officials
said.
If United files for bankruptcy, it could cut payments to the
airport said Debra Hinsvark, a spokeswoman for the city Revenue
Department.
"They (banks) are all in such a wait-and-see attitude,"
Hinsvark said. "They want to see how United does."
The airport pays less than 2 percent interest on the bonds, and
a letter of credit is required to keep that rate. If the airport
can't renew the letter of credit, it may have to refinance the
bonds at higher, fixed rates, which don't need a letter of credit.
Dexia Bank of Switzerland has agreed to extend the current
letter of credit for three months but will not renew it, and the
airport is negotiating with Bank of New York.
Copyright 2002 by TheDenverChannel.com. The Associated Press contributed to this report. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
