Bankers okay with KFA loan recast package

Mumbai: Kingfisher Airlines’ debt restructuring package has received an in-principle nod from bankers. The package will be implemented within 120 days of receiving the Reserve Bank of India’s (RBI) nod.
Kingfisher, the second largest carrier in terms of market share, has debt of around Rs 6,000 crore across 12 lenders such as the State Bank of India, Bank of India and Vijaya Bank, among others.
As a cautionary measure, banks expect the RBI to stipulate the banks to provide a higher provisioning amount for Kingfisher, to classify it as a standard account. Currently, some portions of Kingfisher’s loans are classified as Non Perfoming Assets (NPAs) by some of its lenders. Bank of India has classified Rs 375 crore as NPA; Vijaya Bank has so classified Rs 25 crore.
However, the package also includes a financial guarantee from UB Holdings, the parent company of Kingfisher.
“The details of the restructuring package are still under discussion. However, it is necessary to be done before Kingfisher tries to raise money through equity,” said a source from the banking industry. Kingfisher is likely to raise around Rs 745 crore through the equity route in the next six months.
04/09/10 Business Standard

To Read the News in full at Source, Click the Headline

Categories: Kingfisher Sep 2010