TOKYO: Japan Airlines Corp, Asia's biggest carrier by sales, fell for a third day as Finance Minister Naoto Kan declined to rule out a court-led bankruptcy.

"We need to carefully consider how to rehabilitate JAL, including those issues," Kan said on Friday in Tokyo, when asked about the possible negative consequences of JAL seeking court protection. The government has decided that the carrier should pursue a legal bankruptcy, Nikkei said, without citing anyone.

The Prime Minister's office favors a legal restructuring over a voluntary liquidation as this would provide a more transparent process, the Yomiuri said, citing an unidentified person in the government. A state-affiliated fund is working on a turnaround plan for the carrier, which has posted three losses in four years.