Absolutely false: SpiceJet on report of its loans placed in 'high-risk' category by banks

Budget airline SpiceJet on Monday came out forcefully against a report on its loans being placed in "high-risk" category by banks, terming the report "absolutely false and baseless."

The statement comes after news agency Reuters earlier today reported, citing sources, that private lenders IDFC First Bank and Yes Bank and state-owned Indian Bank have put their loans to SpiceJet Ltd in the high-risk category.

"None of our banks has put our account on high risk or alert. The same has been confirmed to us by our lenders," SpiceJet said in a statement adding, "It is unfortunate that the story was run despite our strong denial and no official comment from any of our banks."

Shares in SpiceJet fell as much as 4.8 per cent on the news. The stock is down 30 per cent so far this year.

Meanwhile, earlier, SpiceJet had said that it has entered into a full and final settlement with the Airports Authority of India (AAI) and has cleared all outstanding principal dues of the airport operator. With this, SpiceJet will no longer remain on 'cash and carry' at AAI-run airports across the country and will revert to an advance payment mechanism for daily flight operations.

Last week, in an unprecedented move, India slashed SpiceJet's approved departures by 50 per cent for a period of eight weeks after an audit revealed the airline's inability to establish "a safe, efficient and reliable" service. While placing SpiceJet under "enhanced surveillance", the regulator stated in its notice there was "poor internal safety oversight" at the airline, and that financial issues at the carrier were leading to "frequent shortage of spares".