Niigata Prefecture to defer Toki Air loan repayment for second year
In short
Niigata Prefecture has decided to defer, for a second consecutive year, repayment on its ¥1.16 billion loan to the Niigata-based regional airline Toki Air. The ¥290 million installment due on October 30 will not be demanded for now, with the prefecture citing risk to the airline's ability to keep operating. Toki Air, which the prefecture says is insolvent, aims to return to profit in fiscal 2028, and some assembly members said the deferral only postpones the problem.
Read the full story 2 min read
Niigata Prefecture has decided to defer for a second consecutive year repayment on its loan to the Niigata-based regional airline Toki Air, saying the ¥290 million principal installment due October 30 will not be demanded for now. The prefecture lent the airline ¥1.16 billion, and it said the deferral is intended to avoid instability in Toki Air's business continuity, according to Nikkei, Sankei Shimbun and Nippon TV News. [ 1 , 2 , 4 ]
The head of the prefecture's transport policy bureau, Katsuhisa Hiramatsu, told the assembly on October 7, according to Nippon TV News: “If we ask for the full ¥290 million to be repaid on October 30, it creates instability in Toki Air's business continuity, so we will not demand the ¥290 million repayment for the time being.” Sankei Shimbun quoted a prefecture official as saying that costs are a concern because of high fuel prices and the weak yen, and that the airline faces a difficult situation in which it needs to raise funds. [ 2 , 4 ]
Nikkei reported that the prefecture examined the feasibility of Toki Air's business plan, which targets a return to profit in fiscal 2028, and will reset repayment terms by October 30. Nikkei also reported the airline's cash and deposits stood at ¥1.3 million as of March, and that Toki Air had asked for the deferral for a second year. Nippon TV News reported the airline is in a state of insolvency and has sought to postpone repayment again this year, and that the prefecture is checking plans to improve revenue, including raising boarding rates and securing pilots. [ 1 , 4 ]
Nikkei reported that at a prefectural assembly standing committee on October 7, members who heard the prefecture's explanation raised many opinions seeking improvement in the airline's management and a stronger prefectural role, including one saying that granting a deferral without a prospect of profitability “only postpones the problem.” [ 1 ]
The documents differ on the loan's history. Sankei Shimbun says the loan was made in fiscal 2022 and that the original plan was to repay ¥230 million a year over five years, finishing in October 2029, with the start extended by one year after last year's worsening results. Nikkei says the prefecture granted a one-year deferral in 2025 and revised the plan so that ¥290 million of principal would be repaid each year from October 30, 2026. [ 1 , 2 ]
Why it matters
The decision keeps a regional carrier based in Niigata flying without immediate repayment, leaving ¥1.16 billion of prefectural funds outstanding while the airline works toward a profit target it has not yet met. It also puts the prefecture's lending and oversight of the airline under scrutiny in the prefectural assembly.
Key facts
- Niigata Prefecture lent Toki Air ¥1.16 billion. [ 1 , 2 , 4 ]
- The prefecture will defer for a second consecutive year the ¥290 million principal installment due October 30. [ 1 , 2 , 4 ]
- The prefecture said it decided the repayment cannot be collected now because it would create instability in Toki Air's business continuity. [ 1 , 2 , 4 ]
- Toki Air submitted a business plan targeting a return to profit in fiscal 2028 and repayment after that. [ 1 , 4 ]
- The prefecture reviewed the feasibility of the plan and is to reset repayment terms by October 30. [ 1 ]
- Toki Air held ¥1.3 million in cash and deposits as of March. [ 1 ]
- Toki Air is in a state of insolvency, according to the prefecture's explanation to the assembly. [ 4 ]
Confirmed by several sources
- Niigata Prefecture has moved to defer, for a second consecutive year, repayment on its ¥1.16 billion loan to Toki Air. [ 1 , 2 , 4 ]
- The installment being deferred is ¥290 million and was due on October 30. [ 1 , 2 , 4 ]
- The prefecture cited instability in Toki Air's business continuity as the reason. [ 2 , 4 ]
- Toki Air seeks to repay after reaching profitability in fiscal 2028. [ 1 , 4 ]
Still unclear
- What the loan's original repayment schedule was. Sankei Shimbun says the original plan was to repay ¥230 million a year over five years, finishing in October 2029, while Nikkei says the prefecture revised the plan to ¥290 million a year from October 30, 2026, after granting a one-year deferral in 2025.
- Whether the deferral is final. Nikkei and Sankei Shimbun report the prefecture has made its policy known, while Nippon TV News says the prefecture is still considering the deferral, with terms to be reset by October 30.
- The exact repayment schedule that will replace the current terms. The documents say the prefecture is to reset conditions by October 30 but do not state the new terms.
- Toki Air's current cash position. Only Nikkei gives a figure, ¥1.3 million as of March.
What local media are saying
Timeline, local time
- Nikkei reports that Niigata Prefecture has decided to allow a second consecutive year of deferred repayment and will reset terms by October 30. [ 1 ]
- Sankei Shimbun reports the prefecture's plan not to demand the ¥290 million installment for the time being, as stated in an assembly committee. [ 2 ]
- Tokyo Shimbun reports the second consecutive deferral on the prefecture's ¥1.16 billion loan. [ 3 ]
- Nippon TV News reports the prefecture is considering the deferral, citing the head of its transport policy bureau. [ 4 ]