SBI not mulling fresh loan to Kingfisher: Pranab
13 Mar 2012
State Bank of India (SBI) will not be providing any fresh loans to cash-strapped Kingfisher Airlines although the cash-strapped airline may need further cash infusion, finance minister Pranab Mukherjee, said today.
''SBI has informed that currently there is no such plan to provide additional loan to Kingfisher Airlines,'' he said in the Rajya Sabha to a question.
SBI had earlier proposed a Rs1,500-crore bail-out package for the airline through a fresh line of credit.
Kingfisher Airlines is sitting on a debt of Rs7,057.08 crore and the financial crunch has forced the airline to delay payment to operating staff. The airline had to suspend several flights after pilots and other operating staff went on a flash strike.
Mukherjee said the SBI-led consortium of lenders has said the airline's debt to eight PSBs is 'sub-standard' and its debt with other five PSBs is `standard debt'.
''Consortium agreed to 'holding on operations' whereby a portion of the credits into the account are appropriated for reducing irregularities in the accounts of banks,'' he said.