AirAsia Group Bhd co-founder Tony Fernandes rejected reports that Malaysia was preparing contingency plans for the budget carrier's domestic operations, saying the airline has not discussed a bailout with Putrajaya and now holds more than RM1 billion in liquidity. Speaking at a hastily arranged virtual media briefing from Bangkok on Friday, Fernandes said AirAsia is pursuing commercial refinancing rather than government assistance as jet fuel costs rise amid the Middle East conflict. The comments followed a Reuters report on Wednesday that Malaysia Airlines and Batik Air had been asked whether they could absorb AirAsia's domestic market share in a contingency scenario. AirAsia shares fell 21% on Thursday to a four-year low, taking their decline since the conflict began to about 75%. The group reported RM954 million in cash and cash equivalents at the end of June, but Fernandes said liquidity has since exceeded RM1 billion. AirAsia is seeking about US$1 billion in international debt financing and RM700 million from local financial institutions, including a signed US$1 billion term sheet from a Middle Eastern investor, while negotiating for lower funding costs and considering share capital raisings in Indonesia and the Philippines. The group reported a second-quarter net loss of RM830.5 million, including RM331 million in foreign-exchange losses, as higher fuel prices increased operating costs. Fernandes said demand remains strong, with load factors at about 80% or higher, and that AirAsia has restored 25 of roughly 60 routes cut during the third and fourth quarters. The carrier has carried 43 million passengers this year and is targeting 65 million to 70 million for the full year, followed by a longer-term goal of 80 million passengers next year.