SBI board wanted letter of support from govt before approving Jet Airways resolution plan

SBI’s board members were keen on a letter of support from the government before giving nod to the resolution plan of crisis-ridden Jet Airways NSE -1.69 %, the bank’s former chairman Rajnish Kumar has said.

In his book titled ‘The Custodian of Trust’, Kumar said dealing with the Jet Airways issue was the one of the most difficult assignments that he had faced during his eventful term as the head of the country’s largest lender.

Most of the banks were extremely reluctant to support a resolution plan for Jet Airways, he wrote, while recalling the developments with regard to the resolution plan of the airline which unfortunately could not get through as promoters were not able to fulfil the required conditions in the stipulated time.

“For me too, this was one of the most challenging cases with even the SBI board being uncomfortable in backing me on this issue, , not because I did not enjoy their support or goodwill but because they felt that it posed a huge risk to the reputation of the bank.

“Consequently, they did not want to be party to such a decision without receiving an explicit letter of support from the Department of Financial Services (DFS) or the MoCA (Ministry of Civil Aviation). I had not faced such a difficult situation throughout my two-year long tenure at the helm of affairs at SBI, but I viewed it as a major learning experience that came in handy in resolving the YES Bank crisis,” he said.

Eventually, the company stopped operations on April 17, 2019 — a sad day in the history of civil aviation in India, when one of the best airlines in the country had to be grounded, Kumar said in the book published by Penguin Random House India (PRHI).

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