DVB Bank has decided to suspend until further notice all financing of aircraft in India following serious issues regarding the deregistration of two Airbus A320s that were on lease to Kingfisher Airlines.
DVB repossessed the two 2006-vintage aircraft earlier this year following a lease termination with Kingfisher. However, it says that despite all documentation being in order, it has been unable to obtain deregistration from the Indian Administration.
"DVB is of the opinion that holding security over an aircraft registered in India does not offer an acceptable protection to owner and mortgagees, and has decided to suspend all financing," the bank says in a statement.
Speaking to Flightglobal, DVB adds that the two A320s at the centre of the dispute are currently outside India, and it is exploring "all available routes" to resolve this issue.
DVB's exposure to India also involves aircraft financed - directly or indirectly - for Air India, Jet Airways, Kingfisher Airlines, Indigo and Spicejet.