Kingfisher Airlines

Kingfisher Airlines Limited, rank 1 defaulter in India. Kingfisher Airlines Limited’s outstanding loan amount is Rs.7500 crore in all banks put together. Kingfisher airlines initiated its operation on may 2005 holds a head office in Mumbai. Till 2011, Kingfisher Airlines conquered almost the second largest share in Indian airlines market. From then due to financial issues Directorate General of Civil Aviation (DGCA) has ordered to shut down Kingfisher Airline’s operations. In 2013, Airline’s domestic and Foreign permits are cancelled which pushes pilots and other employees also in trouble. In 2011, King Fisher voluntarily disclosed that company runs into losses with an unexpected decrease in net worth.

In 2014, Kingfisher Airlines has been stated as the highest bad loan worth 4000 crore in public banks alone. Kingfisher Airlines is now rated as “D” by CRISIL. Various banks have extended hands to offer loan for Kingfisher Airlines. The list of banks and the amount advanced are: United bank – Rs.400 crore , IDBI and PNB – Rs.800 each, Bank of Baroda – Rs.550, Bank of India – Rs.650 crore, UCO bank – Rs.320 crore, State bank of Mysore – Rs.150 crore, Corporation Bank – Rs.310 crore, IOB – Rs.140 crore, Punjab & Sind bank – Rs.60 crore, Axis bank – Rs.50 crore , FED bank – Rs.90 crore  and SBI – Rs.1600 crore. All banks together with SBI as its lead decided to acquire Kingfisher’s properties. Major problem is that Kingfisher’s collaterals produced to banks are not worth the liability amount and also banks have restructured the loans thrice, banks believed that Kingfisher Airlines is genuine. Now, banks have realized that Kingfisher Airlines is a willful defaulter.

State bank of India has requested GOI to involve in Kingfisher Airlines issue. SBI also stated that from the amount recovered with the help of GOI; firstly I-T claims will be settled. United bank lost its hope of recovering money from Kingfisher Airlines as the bank realized the borrower is a willful defaulter. Kingfisher Airline’s planes are also sold for scrap to recover some loans. As pilots and employees have not been paid for their service for a period of time, GOI has ordered Kingfisher Airlines to pay 52lakhs for its employees.

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