SBI asks Kingfisher to pump in $1 bn by month end
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State Bank of India (SBI), the largest lender to the ailing Kingfisher Airlines, wants the airline's promoters to bring in a minimum of $ 1 billion (about R 5,400 crore) by month-end for its revival. "...we haven't put a gun to their head but the more comes in, the better it is because an airline is a very capital-intensive business. I think about $1 billion would be a good starting point," SBI chairman Pratip Chaudhuri told reporters on the sidelines of World World Economic Forum on India summit here.
"We have requested them to attend to capital needs urgently and we would like to see some tangible progress by November 30," he said.
When asked what happens after the November 30 deadline, Chaudhuri said, "There can be no, yes, or no answer."
SBI, the consortium leader of 17 banks, has about R1,200 crore of exposure to Kingfisher. He said loans given to the debt-ridden airline promoted by liquor baron Vijay Mallya has been non-performing and SBI has already made provision for the debt as per RBI's norms. Emphasising that fresh fund infusion is imminent, Chaudhuri said, "We are not interested where the capital is coming from, but we would like to see some capital infusion."
The consortium, led by SBI, has made available a total R7,000 crore to Kingfisher to help it keep flying. Kingfisher is burdened with a loss of R8,000 crore and a debt burden of another over R7,524 crore, a large part of which has not been serviced since January.