Airlines stressing out bank assets

The turmoil in the airline sector is beginning to affect the loan books of banks. Kingfisher Airlines is liquidating assets to meet its debt obligations.
Banks have burnt their fingers by lending to this sector, which is under immense pressure due to rising fuel costs, mismanagement and predatory pricing.
According to the Financial Stability Report released recently by the RBI, 10 banks (predominantly public sector banks) accounted for around 86 per cent of the credit to the airline sector. This indicates the disproportionate share of loans to airlines in the books of few banks.
14/07/12 MVS Santosh Kumar/Business Line

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Categories: Indian Aviation- In General Jul 2012