Kingfisher crisis will not impact our balance sheet: SBI

Jamshedpur: The country’s largest public sector lender State Bank of India has said the prevailing crisis in Kingfisher Airlines would not have any impact on its balance sheet due to small exposure to the beleagured company.

“We have Rs 12 lakh crore balance sheet and our exposure in Kingfisher Airline was small,” SBI Managing Director (National Banking Group) A Krishna Kumar told reporters here, adding that the crisis would have no impact on SBI’s performance.

Banks, including SBI, ICICI Bank, IDBI Bank and Punjab National Bank, have an exposure of Rs 7,700 crore to the airline.

The airline has suffered a loss of Rs 1,027 crore in 2010-11 and has a mounting debt of Rs 7,057.08 crore.

The airline is currently facing troubled times and was led to cancel a number of flights due to factors like increased costs. The beleaguered airline has cancelled 210 flights since last Monday.

The airline has said that it has requested banks for a higher borrowing limit due to rising operating, costs caused by costlier fuel prices and rupee devaluation.

The airline had effected a loan recast earlier this year, wherein some banks were given certain equity stakes, but its debts are still estimated to be about Rs 7,000 crore.

On plans of raising interest rates on savings bank account, Kumar reiterated SBI Chairman Pratip Chaudhuri’s views saying SBI has no plans to raise interest rate as of now.

“Though things are changing each day but as of now we have no plan to raise interest rate on savings account or loans,” Kumar said.

Asked about the status of the Indian Banking sector in view of the prevailing slowdown in parts of the world, including the US, Kumar said our banking sector was “extremely strong and stable”.

He also ruled out any possibility of liquidity crunch in near future as SBI has more Statutory Liquidity Ratio.

PTI