Sun Country Airlines, the Minnesota-based leisure carrier serving Palm Springs on a seasonal basis, has filed for Chapter 11 protection from creditors in bankruptcy court.

In a statement, Sun Country Airlines said it will continue to operate and fly under its regular schedule.

“We'd like to see them stay in the market,'' said Tom Nolan, executive director of the Palm Springs International Airport. “As far as we know, it's continuing.”

The airline, also operating under the name MN Airlines, handled 20,732 passengers in its flight operations in and out of Palm Springs in 2007.

Sun Country's January through April numbers, so far this year, stand at 14,493. Its online booking site as of Wednesday shows season service beginning Nov. 21, with 56 flights loaded into the system through April.

While Sun Country has had a loyal following, it handled only about 1.3 percent of all airline passengers traveling through the Palm Springs airport in 2007, Nolan said. Northwest Airlines, which also offers service to Palm Springs from the Twin Cities, has about a 3 percent share of the travel market.

“We were forced take this action as a result of recent events at Petters Group Worldwide,” Stan Gadek, Sun Country's CEO, said in a statement issued this week.

Sun Country Airlines is a subsidiary of Petters Aviation LLC, which filed the bankruptcy petition and is an arm of its parent company, Petters Group Worldwide.

Thomas Petters, founder and majority stockholder of Sun Country, resigned Sept. 29 as CEO after the U.S. Federal Bureau of Investigation raided the parent company's headquarters.

Petters was arrested Oct. 3 on fraud charges in the FBI probe of a hedge fund investment scheme that may have cost investors more than $2 billion.

Sun Country Airlines' filing was viewed as a move to separate itself from that federal action.

The federal probe into other businesses controlled by Petters froze assets and cut off short-term credit to Sun Country to help the low-fare carrier pay its bills during the light-flying months of October and November.

Nolan said he expects seasonal business by Sun Country will be normal.

“It's not the first time an airline has filed for bankruptcy,'' he said, citing major carriers such as Northwest.