Go First’s bank loans to be classified as ‘bad’, but has strong collaterals

Lenders to Go Airlines (India) Ltd will classify their loans to the company as “non performing” in the current quarter, but are hopeful that the collateral backing the credit would reduce the amount of haircut they have to take, two banking sources said on Thursday.

The low-cost carrier was granted bankruptcy protection by a company court on Wednesday, which also halted repossession of planes by lessors.

“As per norms, the account will have to be declared a non-performing asset in the current quarter, and that will be done,” one of the bankers said. “The account will also have to be provided for.”