Sometime a little hope proves to be a successful fact, and this has come true for crisis-hit Kingfisher Airlines. KFA was waiting for SBI’s relief package that will help it for resolving its disruptions in operations.
Now its hope for relief will going to be fulfill because as per KFA’s expectations, today prominent banks that have lent to the airline have reportedly decided to provide a relief package to it.
As per source report, the State Bank of India, including bank guarantee and loan repayment extension, will provide Rs.1200 crore relief package to Kingfisher out of which nearly Rs. 700 crore will be provided in working capital loans.
However yesterday after declaring losses of 444 crores in Q3 with current debt of 1.3 billion dollars or Rs. 7,057.08 crore, KFA had failed to get support of 18 banks that have lent to it by convert more loans into equity.
In addition to this good news for the cash-strapped carrier, Punjab National Bank is also likely to provide a guarantee of Rs. 160-200 crore.
The beleaguered Kingfisher Airlines has been facing disruption in flights operations from last few years due to financial crisis. That’s why the IT department froze its accounts of Friday.
On Tuesday, the CEO of airline had reached at the DGCA office which summoned them to explain the large-scale disruption in operations and the reasons for it, along with reason of why payment of salaries has been delayed.
Having assured by airline to have enough cabin crew and pilots to manage its flights, the regulator of DGCA, has decided to go for “safety surveillance” of all of Kingfisher’s operating aircraft but assured that there is no cause for concern and passengers need not be worried.
Although a large-scale disruption of its schedule comes in its fifth consecutive day, and at least 40 flights were cancelled across its national network.
Meanwhile, under Rule 140(A) of the Aircraft Rules, 1937, airlines need prior approval of DGCA to curtail their flight schedules. Any violation can amount to cancellation of the flight permit of an airline, as an extreme measure.
