RBI grounds AI's bond hopes

Mumbai: The Reserve Bank of India (RBI) has refused to convert Air India's Rs 18,000-crore debt to statutory liquidity ratio (SLR) bonds.
“We would not consider any such proposal (giving SLR status),” said Governor D Subbarao on Tuesday.
Lenders of the cash-strapped airline had given a proposal to convert its Rs 18,000-crore debt to bonds as a part of the restructuring process. The government guarantees the principal and interest for SLR bonds and, hence, there are no provisioning requirements against them.
Earlier in the day, State Bank of India Chairman Pratip Chaudhuri said the banks were considering three options to convert Air India's debt, and SLR status was one.
25/01/12 Business Standard

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Categories: Air India Jan 2012