Extend special loan to help Jet Airways pay staff: AIBEA

Our Bureau Mumbai | Updated on April 22, 2019 Published on April 22, 2019

Jet Airways employees and their family members at a protest meet in New Delhi on Thursday (file photo)   -  BusinesslLine

If there is viable and acceptable proposal to take over the company, Government must take over the airline or merge it with Air India, says the Assoication.

Banks should come forward to extend a special and exclusive loan to the grounded Jet Airways for the payment of salary dues of the staff or some subsistence payments to them, against a proper collateral of lien on the accumulation in the staff fund like PF and gratuity, according to the All India Bank Employees Association (AIBEA).

“Alternatively, IBA can ask the banks to device a special loan scheme to the staff of Jet Airways to tide over their present financial problems,” said CH Venkatachalam, General Secretary, AIBEA, in a letter to Indian Banks’ Association Chairman Sunil Mehta.

“We are happy to observe that the banks are not showing any hurry to further lend to Jet Airways, rather, bidders are being invited to take over the airline. When our Banks already have an exposure of ₹7200 crore to Jet Airways and when the promoter Naresh Goyal is unable to bring in further capital, and when the airline is already cash-starved, it is most prudent that the banks are not willing to lend any further to them unless and until viable proposals come to take over and run the airline on proper lines,” he said.

Also read: Govt must take over Jet Airways: Shiv Sena

He emphasised that the banks should dispel the wrong impression that when a corporate borrower defaults repayment of the loan or mismanages the affairs of the company, it is the job of the banks to rescue them.

If viable and acceptable proposals do not come at the earliest to take over the company, the Association said that the banks should recommend to the Government to either take over the airline or merge it with Air India.


For more: Jet Airways crisis

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Published on April 22, 2019
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