IDBI Bank has started the process of declaringKingfisher Airlines a "wilful defaulter". The airline owes the bank Rs 750 crore. IDBI is among a consortium of banks which has lent money to the beleaguered airline. Kingfisher is the country's top loan defaulter with banks having an exposure of Rs 7,000 crore. 
 

Other banks like SBI (the lead bank for the Kingfisher loan) and Punjab National Bank are also ready to declare the airline a wilful defaulter after a report by Ernst & Young pointed to gaps in its running. United Bank of India, which is also part of the consortium, has already initiated process to declare the company a defaulter. 
 

"The process is in an advanced stage and we would send out a notice declaring them as a wilful defaulter in a couple of weeks. Last week, we submitted all papers relating to the account, such as statement of accounts, account opening form and cheque books, to the CBI for the agency to start a preliminary enquiry against the company," M S Raghavan, chairman and managing director of IDBI Bank, said on Saturday. 

The Rs 750 crore owed by Kingfisher Airlines to IDBI Bank is currently a bad debt in the books of the bank. "It is an NPA (non-performing asset) and has been fully provided for by the bank," Raghavan said.

IDBI Bank chairman and managing director M S Raghavan said the bank is looking to raise Rs 5,000 crore by paring down the government of India stake in it. "We would be approaching the government to give permission to dilute its stake from 76.5% to 58% or 51%. We are looking to get Rs 5,000 crore, depending on the extent of dilution. In addition, we are also looking to beef up our Tier-I capital through a rights issue or a qualified institutional placement of Rs 2,000 crore and we would approach both domestic as well as international investors depending upon the market conditions," Raghavan said. 

The bank is targeting a growth of 12% in its deposits and 15% in advances. The bank is planning to expand its network to 2,000 branches by the end of the fiscal year, he said. (Times of India)