Jet Airways creditors set to recoup just 5% of monies owed

Lenders to Jet Airways India only stand to receive about 5% of what they’re owed, another blow to banks in the nation that are growing increasingly accustomed to paltry recoveries. The new owners of Jet Airways -- Dubai-based businessman Murari Lal Jalan and Kalrock Capital Management in London -- have proposed paying 3.8b rupees ($51m) of the 78.1b rupees they owe to financial creditors, according to a bankruptcy tribunal order tabled late Wednesday. Some 1.9b rupees will be paid upfront within six months while the rest will come from the proceeds of issuing zero-coupon bonds. The new owners have also offered the lenders a 9.5% stake in Jet Airways and a 7.5% interest in Jet Privilege, the carrier’s loyalty and rewards management company. India has one of the worst bad-debt ratios in the world and falling creditors’ recovery rates offer no respite to the nation’s financial system. Recoveries for financiers from resolved insolvency cases dropped to 39% of dues as of March from 46% a year earlier, Macquarie Capital data show. If the top nine cases by recovery are excluded, lenders received just 24% of dues.<br/>