American Airlines Group Inc., announced that the US Department of the Treasury has approved a US$5.8 billion financial assistance to support the payroll of its employees until September.

The grant called “Payroll Support Program (PSP)” was created through the Coronavirus Aid, Relief, and Economic Security (CARES) Act which US Congress passed to provide relief to American industries impacted by the ongoing coronavirus outbreak.

The funds, which are targeted to support American Airlines' team member salaries and benefits, will come in two forms: a direct grant of US$4.1 billion, and a low-interest rate loan of US$1.7 billion.

In a statement, American said it also expects to separately apply for a loan from the US Treasury of approximately US$4.75 billion.

“The Payroll Support Program recognizes the extraordinary dedication of our entire team, and importantly, sustains the critical air service being provided by our frontline team members,” said American Airlines Chairman and CEO Doug Parker.

“... the support our government has entrusted to us carries immense responsibility and an obligation that American Airlines is privileged to undertake. We recognize the importance of our service as evidenced by the customers who continue to fly today for important reasons, including medical professionals getting to where they are most needed ... it is our privilege to continue flying through the downturn and to be in a ready position as our country and the world return to the skies.”

The PSP protects American’s team members from involuntary furloughs or pay rate reductions through Sept. 30, 2020, at which point demand for air travel will have hopefully recovered. The airline has also agreed to limitations on stock buybacks, dividends and executive compensation.