Kingfisher lenders will give all chances to restart ops: SBI
The 17-bank consortium has extended Rs 7,000 crore loans to Kingfisher.
Bangalore: Kingfisher lenders will give all chances to the grounded airline to restart operation even as bankers are concerned over their outstanding dues, SBI Chairman Pratip Chaudhuri said on Monday. The chief of State Bank of India, which heads the 17-member lenders' consortium, also said, "We don't give up hope till they say no."
The 17-bank consortium has extended Rs 7,000 crore loans to Kingfisher. SBI alone has an exposure of Rs 1,500 crore, which has not been serviced since January, 2012.
"This (meeting of lenders) will be happening soon ... we are giving every opportunity to the company to restart operation. At the same time we are also mindful of the outstanding that the company owes to the bank. So we are doing fine balancing act," Chaudhuri said. As per the revival plan submitted to the Directorate General of Civil Aviation (DGCA) in December 2012, Kingfisher had said it would require about Rs 652 crore over the next 12 months for running its operations. These funds would come from the UB Group's resources as banks were unwilling to fund the cash-strapped airline.
Of the Rs 652 crore that the airline would need to restart operations, Rs 120 crore would be needed to meet salary arrears for its employees. However, the government last month made it clear that Kingfisher Airlines would not be allowed to fly till it cleared all its dues, including pending salaries of its
For the third quarter ended December 2012, Kingfisher reported a net loss of Rs 755.17 crore, a period when it did not operate a single flight. Asked if the net interest margin of SBI would be hit because of cut in the lending rate, Chaudhuri said its impact would be neutral.
"The CRR cut of 0.25 per cent has been put in our hands Rs 250 crore more in profitability and another Rs 25 crore due to cut in the repo rate. We are happy to say that we have fully passed on the benefit to our customer. So in term of NIM it would be neutral," he said.
On stressed assets, he said, "Asset quality I think worst is behind us. So what we think in this quarter and the next quarter there would be stabilisation and a possible improvement."
He also said that fixed deposits are becoming less attractive due to taxation policy. "There is a genuine fear that business because of tax-free bonds, infrastructure bonds mutual funds instruments are taking away saving from banks. Within financial savings, bank deposits are becoming less attractive because of the unfavourable taxation," he added.
- Schizophrenia Can't be Ground for Halting Death Penalty, Says Pakistan SC Citing Indian Judgment
- 2nd Test: Fit-Again Younis Khan Leads Pakistan's Charge Against WI
- BSF Says 7 Pak Rangers, Terrorist Killed in Retaliatory Firing Along Jammu Border
- Salahuddin Seeks Help From Pak Military Pak Over Kashmir
- Islamic State Has Seized 550 Iraqi Families to Use as Human Shields, Says UN
- After Rita Bahuguna Joshi's Exit, More Congress Veterans Eye BJP
- Islamic State Retaliates as Iraqi Forces Push on Mosul
- Bihar Dy CM Tejaswi Gets 44,000 Marriage Proposals On WhatsApp
From Our Network
- AAP in new packaging: Is Swaraj India cloning old party by targeting Varun Gandhi?- FirstPost
- Senior SP leaders to mediate between Akhilesh Yadav and Mulayam Singh to resolve contentious issues - Pradesh18
- Did MLA Satyadev Katare die due to Assembly's 'bad vastu', asks Kailash Vijayvargiya - Pradesh18