Bankers to meet on aviation debt restructuring soon: IDBI Bank
Leading public sector lender IDBI Bank today said bankers will meet within a month to discuss the modalities of recasting the Rs 60,000 crore debt pile of airlines, following the recent RBI suggestion in this regard.india Updated: Sep 09, 2010 21:54 IST
Leading public sector lender IDBI Bank on Thursday said bankers will meet within a month to discuss the modalities of recasting the Rs 60,000 crore debt pile of airlines, following the recent RBI suggestion in this regard.
"We will meet under the aegis of the Indian Banks Association shortly and discuss the modalities of the proposed restructuring of the Rs 60,000 crore debt of the aviation industry," IDBI Bank Chairman R M Malla said on the sidelines of a three-day Ficci-IBA banking meet that ended here today.
"Hopefully, the whole process will be completed within four to six weeks," Malla said further.
Earlier in the day, State Bank Chairman O P Bhatt said the banks' huge exposure to airlines has not yet become bad debt and the Reserve Bank's suggestion is a measure to help the struggling industry come out of the red.
Though Malla refused to divulge details about his bank's exposure to the airlines, a source in-the-know said IDBI Bank has an exposure of nearly Rs 3,600 crore to the sector. Giving a break-up, the source said, "Out of this, Rs 1,700 crore is to the national carrier Air India, a little over Rs 1,000 crore to Jet Airways, Rs 750 crore to Kingfisher Airlines and around Rs 30 crore to Paramount."
The Reserve Bank had on Wednesday asked banks to work out a special concessional package for the crisis-ridden aviation sector, in response to which the lenders said they would look into the problems on a case-to-case basis.
"We are sensitive to the requirement of the aviation sector and have communicated the same to the banks," Deputy Governor Usha Thorat had told newsmen on the sidelines of a banking meet organised by the Ficci and IBA on Wednesday.