NEW DELHI: Even as the DGCA received a revised schedule from cash-strapped Kingfisher Airlines, on Wednesday, to operate a truncated number of flights, unconfirmed reports of a `1,600 crore bailout by a consortium of banks led by SBI were doing the rounds.
While Kingfisher spokesperson refused to comment saying, “We don’t discuss our banking relationships,” SBI spokesperson said that they don’t comment on private clients’ businesses.
Unconfirmed reports said that State Bank of India had decided to extend a package of `1,600-crore to Kingfisher Airlines. SBI Chairman Pratap Chaudhuri had as recently as January 5, 2012 told the media, “Kingfisher is a NPA (non-performing asset) for us. They are in default.” If the rumours are to be believed, one would wonder what caused this change of heart by this government entity.
Everyone who could possibly be involved in the new developments remained tight-lipped. Civil Aviation Secretary Nazim Zaidi said he was not aware of any loan overtures. “I have received the report from DGCA on the status quo that Kingfisher submitted to it along with the observations. I am yet to read it,” he said, in spite of taking part in a 30-minute meeting between Civil Aviation Minister Ajit Singh and DGCA chief Bharat Bhushan.
Finance Minister Pranab Mukherjee refused comment saying everyone would eventually know as the decisions unfold. SBI Chairman Pratap Chaudhuri also denied comment. Ajit Singh said, “If the banks can lend money, it is good. The ministry is not going to propose any bailout.”
SBI, leader of the consortium of banks that have lent funds to Kingfisher Airlines, has invested `1,457.78 crore in the struggling firm.
DGCA Chief Bhushan said Kingfisher should be able to run about 170 flights with its 28 operational aircraft.