Extend special loans to Jet to clear staff dues: Bank employees union

All-India Bank Employees Association praises SBI-led lenders for deft handling of Jet case

Bank unions have thrown their weight behind employees of Jet Airways and have sought special loans for the carrier for paying off staff dues. The unions have also asked the government to take over the grounded airline or merge it with state-owned Air India.

They praised lenders led by State Bank of India for their mature and pragmatic handling of the Jet Airways case, especially for not yielding to pressure to extend a rescue loan.

The All-India Bank Employees Association said on Monday that banks should come forward to extend special and exclusive loans to the company, which could be used to pay the salary dues of the staff or to make subsistence payments against proper collateral of lien on the accumulation in the staff Fund like Pevident Fund and Gratuity.

Alternatively, Indian Banks' Association, the banking industry lobby group, can ask the banks to devise a special loan scheme to Jet Airways staff to tide over their present financial problems, AIBEA added.

"We are happy to observe that banks are not in any hurry to further lend to Jet Airways. Rather, bidders are being invited to take over the airline," AIBEA added.

Banks already have an exposure of Rs 7,200 crore to Jet Airways. Naresh Goyal, promoter of the airline, is unable to bring in further capital, and the carrier is already cash-starved. Against this backdrop, it is most prudent that banks are not willing to lend further to the airline until there are viable proposals to take over and run the airline properly. AIBEA says It supports the stand taken by lenders.