May 19, 2020 / 7:03 PM / 3 months ago

American Airlines may use loyalty program as collateral for U.S. debt: President

FILE PHOTO: An American Airlines Boeing 737 jet sits at a gate at Washington's Reagan National airport with the U.S. Capitol building in the background as the novel coronavirus (COVID-19) pandemic continues to keep airline travel at minimal levels and the U.S. economy contracts in the first quarter at its sharpest pace since the Great Recession, in Washington, U.S. April 29, 2020. REUTERS/Kevin Lamarque

(Reuters) - American Airlines Group Inc (AAL.O) may use its Advantage loyalty program as collateral for a secured U.S. government loan, President Robert Isom said at a conference on Tuesday, noting that government talks are ongoing.

American is discussing terms for a $4.75 billion Treasury loan, separate from the $5.8 billion it has already secured in government payroll aid. The “impact value” of the loyalty program could range between $18 billion and $30 billion, Isom said.

Reporting by Tracy Rucinski

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