State Bank of India chairman says bankruptcy ‘last option’ for Jet Airways

FILE PHOTO: A Jet Airways Boeing 777-300ER taxis at San Francisco International Airport, San Francisco, United States
FILE PHOTO: A Jet Airways Boeing 777-300ER taxis at San Francisco International Airport, San Francisco, California, February 16, 2015. REUTERS/Louis Nastro

March 20, 2019

NEW DELHI (Reuters) – State Bank of India’s head told reporters on Wednesday that putting Jet Airways into bankruptcy is the “last option” for lenders and that they are making every effort to keep the airline flying.

“We believe that it is in everybody’s interest that Jet Airways continues to fly,” the SBI chairman, Rajnish Kumar, told reporters after a meeting with government officials, adding that placing Jet into bankruptcy would mean grounding the airline.

Kumar said that talks with Abu Dhabi-based carrier Etihad, Jet’s largest shareholder, to secure a rescue deal are ongoing.

There is also the possibility of bringing in a new investor, he said. Kumar also said that any decision taken to rescue Jet is a commercial one and is not at the direction of the Indian government.

The 25-year-old airline has defaulted on loans after racking up over $1 billion in debt, and owes money to banks, suppliers, pilots and lessors – some of whom have started terminating their lease deals with the carrier.

The government has asked state-run banks to rescue Jet Airways without pushing it into bankruptcy, two people within the administration have told Reuters.

(Reporting by Manoj Kumar; Edited by Martin Howell)

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