airBaltic has formally requested up to $170 million in interim financing from bondholders to stabilize liquidity and avert a payment default while reviewing its capital structure. The state-backed Latvian carrier, supported by Lufthansa, will present the bridge financing proposal at an 3 August bondholder meeting after Fitch Ratings assigned a CCC- rating with a negative watch, citing a high likelihood of default without new funding. Rising costs linked to the Iran conflict and postponed IPO plans have exposed structural weaknesses, forcing the airline to seek short-term capital to sustain its 55 Airbus A220-300 fleet operations. Bondholders face a recovery rating of RR4, indicating potential principal loss of 31% to 50% if restructuring occurs, as the government refuses further support without a clear strategic path.