Banks ‘run system of virtual extortion’

IRISH banks were accused by the Irish Creamery Milk Suppliers Association (ICMSA) yesterday of operating a system of “virtual extortion” on farm loans.

ICMSA president Jackie Cahill said farmers are being surcharged by banks by up to €150 million on an annual basis and overdraft rates in Ireland are more than double the British rates.

He said that there was no logical reason why the overdraft rates presented to farmers in Ireland range from 9.1% to 10.5% while overdraft rates of less than 5% are readily available in Britain. “The structure of long-term lending to farmers and the security basis of those loans has changed significantly in recent times with all long-term lending now being secured by legal mortgage.