Farmers fear potential sale of loans to vulture funds as Ulster Bank exits the market
Ulster Bank plays a critical role in agri-lending, accounting for approximately 16% of the market share in agri-customers and is an active participant in any SBCI schemes which came on the market. File Picture.
Farmers fear the potential sale of their loans to vulture funds following the announcement by NatWest that it is to wind down Ulster Bank in the Republic of Ireland.
Irish Farmers’ Association (IFA) president, Tim Cullinan, said the bank must commit to “not selling any of its loan book to a so-called vulture fund, but to banks that can offer a full service to customers”.
NatWest Group confirmed this morning that it plans to wind down its operations putting close to 3,000 jobs at risk and dramatically lessening competition in the Irish market.
There are 88 Ulster Bank branches with €20.5bn in home loans and corporate lending in the Republic.
“This withdrawal has significant consequences for competition in the sector, but the first priority must be to ensure that the loan book ends up with a bank that provides a full banking service and not a faceless fund,” Mr Cullinan continued.
“NatWest has a moral responsibility to their customers to ensure this does not happen and it is positive to learn of the engagement NatWest is having with AIB and PTSB.”
Meanwhile, Ulster Bank confirmed that AIB will buy €4bn of its commercial loans, with a final agreement over price still to be struck.
It also said it was in talks with Permanent TSB and other “strategic banking counterparties” over the sale of its retail and small business loans.
“Ulster Bank’s departure will be another crippling blow to competition in the sector and the lack of choice for borrowers will further drive up the cost of borrowing in Ireland,” Mr Cullinan added.
“The bank plays a critical role in agri-lending, accounting for approximately 16% of the market share in agri-customers and is an active participant in any SBCI schemes which came on the market.
“Ulster Bank has a duty of care to its existing customers, so it must quickly reverse the lack of engagement on the issue and reduce the stress for existing customers.”
