At least two banks, the third largest private sector lender Axis Bank and the south-based Federal Bank, have said they have not classified KFA, Mallya and his senior officials as wilful defaulters.
"We have not classified them as wilful defaulters as yet," Axis Bank executive director in charge of corporate banking V Srinivasan said.
The exposure, declared as bad loan long time back, is very small, he said, adding that the bank had an exposure of Rs 50 crore to the airlines that has not flown since October 2012.
Its peer Federal Bank has also not declared the liquor baron Mallya as "a wilful defaulter", the bank's managing director and chief executive Shyam Srinivasan said.
The bank is engaged in negotiations with the airline and is considering "all options" of recourse to recover its outstanding, he said.
The bank has been able to recover around 12 per cent of its total exposure of Rs 90 crore till now, he added.
Country's largest private sector lender ICICI Bank had sold its Rs 430-crore exposure to an arm of the Kolkata-based Srei Infrastructure Finance. The status on that exposure, which reportedly had the best of collaterals, is not immediately known.
The wilful defaulter tag, dreaded by the industry, is designed to impact the top management's ability to raise any loan in the future, even in the case of other companies where they hold directorships.
The troubled United Bank of India, Punjab National Bank (PNB), State Bank of India and IDBI, usually criticised for lax approach, have declared Mallya and company's directors Ravi Nedungadi, Anil Kumar Ganguly and Subash Gupte as "wilful defaulters" since August.
The process was challenged by the company at various High Courts, and bankers are now confused about the legal position as different higher courts have given different views on Mallya's petition.
While the Calcutta HC approved the United Bank's action of declaring him a wilful defaulter, a similar action by PNB was stayed by the Delhi HC.
A consortium of 17 banks, led by SBI, has a Rs 7,600 crore exposure to Kingfisher, which has been declared as non- performing asset and has led to public outcry against the bankers for tardy diligence which led to the defaults.
Since recalling the KFA loan in February 2013, banks could so far recover around Rs 1,000 crore by selling pledged shares. The banks have now only the around Rs 90-crore Kingfisher Villa in Goa and the around Rs 150-crore Kingfisher House as collaterals with them.