Recovering monies owed to them by Vijay Mallya’s defunct Kingfisher Airlines by auctioning “Kingfisher House” and “Kingfisher Villa” is proving to be a Herculean task for banks. There were no bidders at the auction of these properties on Monday.

Despite the reserve price on the two properties being marked down by about 10 per cent from the previous auction, there was no buyer interest in them, said a source well versed with developments in this regard.

“There were no takers, despite the auction being held at market-related price. Multiple attempts at auctioning the properties have come a cropper. Banks will once again meet to take a call on whether to bring down the price further. Also, we may look at the possibility of a bilateral deal,” he said. Borrower Kingfisher Airlines, which was grounded in 2012, owed about ₹6,203 crore to a 17-bank consortium as on May 31, 2013, with further interest thereon at the rate of 11.50 per cent per annum with yearly rests with costs and charges.

Bankers say this amount has now bloated about ₹9,000 crore. The airline’s promoter Mallya has been declared a wilful defaulter by banks.

The reserve price of Kingfisher House was reduced from ₹135 crore at the last auction to ₹103.50 crore for the latest auction. Similarly, the reserve price of the palatial Kingfisher Villa was cut from ₹85.30 crore to ₹73 crore.

The guarantors to both the properties are United Breweries (Holdings) Ltd and liquor baron Vijay Mallya, who is now in London.

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