Lenders to the financially distressed Go First Airlines on Wednesday decided to await the National Company Law Tribunal’s (NCLT) decision on the airline’s decision application and hear the company out before making a call on how best to protect their interests.
At a meeting, the lenders took stock of the situation arising from the airline filing for resolution proceedings under the Insolvency and Bankruptcy Code, 2016. Banks, including Central Bank of India (CBoI), Bank of Baroda (BoB), Deutsche Bank and IDBI Bank, collectively have an exposure of about ₹6,500 crore to the Wadia-owned airline.
The airline claimed that it has grounded 28 planes, which is more than half of its fleet, due to the non-supply of engines by Pratt & Whitney (P&W). Mounting dues to vendors and lessors also added to its woes.
CBoI on Wednesday said its outstanding exposure to Go First Airlines as on March 31, 2023, was ₹1,305 crore. An additional amount of ₹682 crore was sanctioned under the emergency line of credit guaranteed by the Government of India.
“Our exposure to the company is only 0.91 per cent of our total advances as of March 31, 2023, and interest charged up to April 30, 2023, is serviced by the company,” the public sector bank said in a regulatory filing. The bank emphasized that in the recently published financial results for FY23, it has made contingency provisions of more than ₹1,500 crore to strengthen the balance sheet.