Even as the Kingfisher Airlines crisis deepened on Thursday with Delhi-based pilots and engineers declining to report to work till wages for the past seven months were paid, the airline got a lifeline from banks. Banks have agreed to release around Rs 60 crore lying in the escrow account with them, said a banker.

Following the restructuring of the airline in November 2010, the escrow account was created to channel all payments, including ticket sales. Under the escrow mechanism, only banks can access the funds. The funds could help in partly clearing salaries and other statutory dues.

According to airline sources, at the meeting the staff had with Chief Executive Officer Sanjay Agarwal in Delhi, “all employees expressed their keenness to resume work provided their dues were cleared expeditiously.” Sources said that Agarwal is travelling around the country and is expected to meet employees in Chennai on Friday.

The cash-strapped airline also suffered a jolt with its Company Secretary Bharath Raghavan resigning.

Tragedy hit the airline staff as the wife of a Delhi-based employee killed herself citing financial stress on the family, as wages had not been paid for the last five months.

The airline today sent out an advisory saying flights will remain grounded till at least October 7. Government sources said the Directorate-General of Civil Aviation had sent an e-mail to the airline asking it not to take any bookings till “the DGCA expresses satisfaction at their operational preparedness.”

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