Jet Airways: AIBEA urges PM to order thorough enquiry, punish wrongdoers

Our Bureau New Delhi | Updated on April 19, 2019

Naresh Goyal (file photo)

Seeks Govt intervention so that banks are not pressurised to dole out further loans

The All-India Bank Employees’ Association (AIBEA), a leading representative body of bank employees, on Friday demanded a thorough enquiry into the affairs of Jet Airways and the reasons behind the airline getting grounded.

In a letter to the Prime Minister Narendra Modi, AIBEA General Secretary CH Venkatachalam has emphasised that the wrongdoers who brought down Jet Airways should be punished.

“The attempts to sidetrack the whole issue by building pressure on banks to extend further loan and save the company is only with a view to keep Naresh Goyal out of the picture, whereas he is the real man who is answerable for the whole crisis,” said Venkatachalam.

Also read: Jet Airways flies into oblivion

The government should intervene immediately so that banks are not pressurised to dole out further loans, he said.

AIBEA has also in its letter welcomed the decision of the Mumbai High Court declining to give a direction to the government to ask banks to extend further loans.

Jet Airways is facing deep trouble on account of its financial difficulties caused due to various business decisions of the airline’s management.

Banks have already extended credit of around ₹8,500 crore to Jet Airways, and these huge loans have turned non-performing in view of the company not being able to service the loan in due time.

“This has not happened overnight, and the airline has been facing problems for the past few years. Yet, banks have been helpful with the hope that the company would soon come out of the problems. But it was not to be and the company is now in crisis for its survival,” said Venkatachalam.

Also read: Fate of 22,000 Jet Airways' employees hangs in balance

AIBEA has expressed concern that the staff of the company have not been paid salaries, and the proposals of the banks to temporarily help tide over the problem are not being accepted by the failed airline.

Banking industry experts highlighted that every day lost in finding a solution to the Jet Airways problem will result in loss of value for the airline, prompting prospective investors to demand a huge haircut. Already, there are reports that some bidders – in all four – are demanding a 80 per cent haircut from banks before accepting to run the airline.

It may be recalled that banks have invited bids for investors to take over the company. If no bidder is willing to invest and manage the airline, then the government must take over the airline so that jobs and future of thousands of employees, most of whom are young, are safe and without jeopardy, the AIBEA letter suggested.


Published on April 19, 2019

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