EPF finally to provide a loan of Rs12 billion to NAC to aid the purchase of two A330s

June 12, 2017

Nepal Airlines Corporation (NAC) is set to receive a loan of Rs12 billion from state-owned Employees Provident Fund (EPF) after the agreement was signed between the both parties on Sunday.  NAC has to pay interest on the loan at the rate of 9 percent annually.

A total of Rs24 billion loan is expected to be collected by NAC; Rs12 billion from EPF and Rs12 billion from CIT (Citizen Investment Trust). After finalization of loan agreement from EPF, NAC is now in the process of signing agreement with CIT. NAC will receive Rs4 billion each from EPF and CIT as first installment of the loan.

The sales and purchase agreement for two wide-body Airbus A330-200 was signed by NAC and AAR Corp on April 7, 2017 which became the historic day in Nepali aviation industry. Due to the long processing time of obtaining loan, NAC requested AAR Corp (the supplier of A330s) to extend initial payment deadline.

NAC’s total debt will increase to Rs34 billion as the corporation already took loan of Rs10 billion in 2015 to buy two Airbus A320-200 from EPF.

The current owner of the two wide-body jet aircraft, which NAC is acquiring soon, is an airline based in Lisbon, Portugal named HI Fly.

NAC has announced to increase flight frequencies to major destinations like Kuala Lumpur, Hong Kong and Doha. Also it will be launching four new long-haul routes namely Seoul (South Korea), Tokyo (Japan), Dammam (Saudi Arabia) and Sydney (Australia).

Source: kathmandupost.ekantipur.com


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