JOIN USThe Kolkata-based UCO Bank has initiated the process to declare Vijay Mallya and his Kingfisher Airlines as “wilful defaulter”, sources in the bank said on Monday. The bank is in the process of sending a notice to the business mogul for defaulting on a loan of Rs 450 crore, which he had taken to set up the airlines.
While the bank is yet to make an official announcement on its decision, sources within the bank informed that the process has been started and a notice will be sent to Mallya soon. “We’ve identified that Mallya has diverted borrowed money. Although we haven’t taken a final decision, we’re very close to making that call,” a senior official in the bank’s recovery department said.
Sources within UCO Bank informed that along with Kingfisher Airlines, the bank will also send a notice to the company that provided corporate guarantee for the loan to Mallya.
The airline borrowed around Rs 7,000 crore from a consortium of 17 banks, including UCO bank, United Bank of India (UBI), the State Bank of India (SBI) and Punjab National Bank (PNB). Insiders said that SBI and PNB are also mulling the same route, with UBI having already attached the tag to Mallya for defaulting on a loan of Rs 350 crore.