The MD of the bank says that the airline has promised to give 2 crores. promoter’s shares
The MD of the bank says that the airline has promised to give 2 crores. promoter’s shares
Low-cost carrier SpiceJet has offered to settle ₹97 crore outstanding to City Union Bank Ltd (CUB) in a phased manner before June 2023, the lender’s MD said on Saturday.
CUB’s MD and CEO N. “The SpiceJet management has come forward to clear its dues in a phased manner,” Kamkodi told analysts on a call. “They are paying their dues regularly and the interest is being paid till July,” he said.
Stating that the carrier had requested the bank to renew the existing facility and the terms and conditions, he said the renewal plan was mutually agreed upon.
As per the agreed terms and conditions, SpiceJet had immediately paid ₹3 crore dues in July and agreed to pay an additional ₹12 crore before the end of August.
While agreeing to settle the balance amount of ₹97 crore before June, SpiceJet had pledged two crore shares, owned by the promoter, as collateral. The market value of the stake is over ₹90 crore.
The account was now out of Special Mention Account status. Till Q3 of FY22, CUB had made a provision of ₹85 crore and another contingency provision of ₹12 crore in Q1 of FY23. Hence, the bank had made contingency provision for the entire amount, he said.
The lender also said that it wanted to push the growth pedal to achieve credit growth of 15-18% as against 12-15% announced earlier, as it would be good on all factors like credit growth, non-performing assets. expected to perform. asset quality.
“Right now, it looks like we can push the growth pedal in the third and fourth quarters,” he said.
In the coming days, CUB expects the decline from FY 2012 to moderate and recovery to improve, resulting in substantial reduction in gross and net NPAs for FY 2013.
Mr Kamkodi said that 50-75 branches are planned to be opened in different states during the third and fourth quarter with an investment of Rs 25 lakh per branch. He said the bank branches in Tamil Nadu would achieve breakeven in 18 months and in other states in about 30-36 months.