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Indian banks violated their own rules and regulations in lending to Vijay Mallya.

Indian banks extended loans to Vijay Mallya even after his airline, Kingfisher, was posting losses in thousands of crores.

Indian banks extended loans to Vijay Mallya even after his airline, Kingfisher, was posting losses in thousands of crores.Vijay Mallya is wanted in India on charges of defrauding banks of more than Rs 9,000 crore. The businessman has been in the United Kingdom since March 2016. He recently sought asylum in the UK on humanitarian grounds, which has delayed his extradition to India.

In 2018, a British judge, Justice Emma Arbaughnott, while hearing the extradition case of liquor baron, Vijay Mallya, said that evidence suggests that the Indian banks sanctioned some of the loans to the Kingfisher Airlines broke their own rules and regulations.

Loans of over ₹6,000 crores were given to the airline by a consortium of 17 banks led by the State Bank of India, which alone had lent ₹1,600 crores. The State Bank of India and its consortium banks had advanced various credit facilities to Kingfisher Airlines between 2005 and 2010. During 2009-10, the company failed to meet its repayment commitments to the bank, and Kingfisher Airlines did not keep its account with the consortium banks regularly, which became a Non-Performing Asset. The consortium banks, therefore, recalled the credit facilities and also invoked the corporate guarantee of UBHL and personal guarantee of Mr. Mallya. He deliberately did not repay the amount, outstanding dues payable by Kingfisher Airlines to the consortium of banks. However, the banks should not have lent such staggering sums to Vijay Mallya after his company was reporting major losses. In 2009, the airline's debt reaches Rs 7,000 crore.

Many senior bank officials who had dealt with loans given to Kingfisher Airlines have been named as accused in a CBI charge sheet indicating that those officials had violated the norms in aiding kingfisher airlines.

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