Free Press Journal

BSE seeks clarification from United Bank over Kingfisher loan


Mumbai: State-run United Bank of India today said the BSE has sought clarifications from it on reports that it does not expect to recover Rs 400 crore loan to the grounded carrier Kingfisher Airlines. The BSE has sought clarification from us with respect to news reports in this regard, the bank said in a regulatory filing. The bank is yet to reply to the exchanges.

Last week, bank’s newly-appointed chief executive P Srinivas told PTI had said it would be able to just recover interest component from the Rs 400 crore it had lent to the airline, owned by flamboyant Vijay Mallya.

The airline has been grounded since October 2012. “Now, nothing is happening on the Kingfisher account and we are not getting any amount. We may ultimately get a few more crore by selling that building (Kingfisher House in Mumbai) and other collaterals,” Srinivas had said.

“But when you look at the total loan amount, what we may ultimately recover is just equivalent to interest component. In last two years, we lost even interest payment and we may be able to recover that much and the principal amount we may not,” he had said.

The airline owes Rs 6,500 crore to a 17-lender consortium led by State Bank of India, which has an exposure of Rs 1,600 crore to the grounded airline. In February this year, SBI had taken over the possession of the airline’s prime property Kingfisher House near the city airport, after a protracted court battle. Over 17,000 sq. ft. property at Vile Parle near the domestic terminal is valued at around Rs 100 crore.