TOKYO - Standard and Poor's on Wednesday downgraded its credit rating on Japan Airlines as the likelihood of a debt waiver or debt-for-equity swap deal grows.

Less than three weeks after a rating downgrade, S and P again lowered the long-term corporate credit ratings on JAL and Japan Airlines International by two notches from B-minus to CCC and kept the firms on its credit watch with a negative outlook.

The downgrade "is based on the recognition it is becoming more likely that JAL will opt for a debt waiver by its creditors or for a debt equity swap in its restructuring plan" under the supervision of a quasi-public body, it said.

Struggling JAL said last week it asked for help from the Enterprise Turnaround Initiative Corporation of Japan to turn around its loss-making operations.

The agency was launched last month to help debt-laden companies seen to have the potential to recover.

Asia's biggest carrier, which lost more than one billion dollars in the April-June quarter amid a slump in international air travel, is seeking another public bailout, its fourth since 2001, to keep operating.