Gill Airways, a regional carrier based in Newcastle upon Tyne, has ceased operations after its bankers withdrew funding.
The airline, which offered service to Ireland, London, the Channel Islands and Paris, blamed its problems in part on higher insurance premiums imposed in the wake of the suicide hijacking in the US.
A statement from the Bank of Scotland said the 32-year-old airline had been losing money for some time and had been given a chance last month to make fresh proposals to solve its “worsening financial position".
“Despite these proposals, sadly, the financial position of the company could no longer be supported,'' the bank said.
The company said it had been hit this week with heavy increases in insurance premiums along with a new requirement of paying premiums quarterly in advance, straining the its cash position.
The company had 240 employees.
