Airline Lufthansa, announcing profits "far" in excess of expectations, has attacked banks and the government for threatening Germany's economic health.

The German flag carrier revealed that operating profits over the first nine months of the year had hit 172m euros (£110m; $171m), a rise of 172% over earnings in the same period a year before.

The tax reforms neither fit into the macroeconomic context nor do they strengthen Germany as an industrial location

Juergen Weber, chief executive, Lufthansa

The result was evidence of the airline's "vigilance, speed and flexibility" after an aviation crisis which had threatened Lufthansa's "very existence", chief executive Juergen Weber said.

The carrier was quick to cut jobs and capacity after last year's September 11 attacks on the US left the industry in turmoil.

Lifelines threatened

But Lufthansa warned that a reluctance among debt-shocked banks to consider fresh lending was leaving German firms without cash lifelines.

"The increasingly evident reluctance of banks to assume even average risks is cutting off a rising number of our customers from sources of finance," said the airline's chief financial officer, Karl-Ludwig Kley.

"We hope that the banks will abandon their present exaggerated risk aversion and return to a policy of rational corporate assessment."

Deutsche Bank, Germany's largest bank, last week revealed losses of 181m euros after raising its provision for bad debt.

Reforms condemned

Lufthansa also hit out at tax reform plans proposed by the government of newly re-elected Chancellor Gerhard Schroeder would cost the airline 130m euros a year, excluding possible reforms to VAT.

"[The tax reforms] neither fit into the macroeconomic context nor do they strengthen Germany as an industrial location," Lufthansa chief executive, Juergen Weber, said.

"A whole wave of discriminations will hit German airlines if these plans are faithfully implemented.

"Aviation is not a superfluous luxury item - aviation is the catalyst of economic growth.

"Our wish is that this wasn't called into question again and again."

The carrier would be hit by proposed reforms to areas such as trade tax and levies on refinancing investment, a Lufthansa spokeswoman told BBC News Online.

Investor reaction

Lufthansa warned that it faced further threats through the continuing decline in business travel and "large" pay claims, with flight attendants and ground personnel demanding a 9% wage increase.

Profits for 2002 overall should come in at 700-50m euros, Wednesday's statement said, suggesting the carrier expected to make a loss in the October to December period.

While the figures for the first nine months were warmly welcomed by analysts, Lufthansa's caution over future challenges trimmed investor optimism.

Lufthansa shares stood 1.2% lower at 12.59 euros in midday trading in Frankfurt.