Vulture funds ‘a threat’ to farms

There have been calls for government intervention over fears that a growing number of farms could come under threat of repossession due to the loans linked to them being bought by so-called vulture funds.

Vulture funds ‘a threat’ to farms

Reports yesterday referred to the purchase of a €2.5bn Ulster Bank loan portfolio by US-based fund Cerberus Capital Management last October with suggestions that up to 200 farmers could be affected.

There is also the possibility that other similar loan portfolios could also be s old on, and Independent TD Mattie McGrath said any possibility of a ramping up of farm repossessions was “very distressing” and “must be combatted with every available legislative or regulatory tool at our disposal”.

“The average farm income for 2016 remained at €26,000,” he said. “When you couple that with the disastrous year that farmers in the pig, cereal, tillage and pig sector have had, then the situation is really quite worrying.”

The Tipperary TD said he was calling on the ministers for finance, agriculture, and rural affairs to consider creating a cross-departmental task force to deal with the issue and also stressed the need for a review of the “higher than average” interest rates being charged on new loans to the farming sector.

John Comer, the president of the Irish Creamery Milk Suppliers Association, said there was “a lot of stress and anxiety out there” in relation to the growing involvement of the vulture funds, which people viewed as an “unknown entity”.

Mr Comer told the Today with Sean O’Rourke show on RTE radio: “If vulture funds start selling off family farms in rural Ireland over the course of next year or two there certainly will be ugly scenes manifesting themselves”.

He said pragmatic solutions could be found where farmers were under debt pressure, although Matt Carey, a debt resolution adviser, told the same programme that there were concerns over the ability to deal directly with vulture funds.

The Irish Cattle and Sheep Farmers’ Association rural development chairman, Seamus Sherlock, said farmers should not to be panicked, stating it had received assurances that all strategies where family farms are concerned will be explored.”

“ICSA is well aware that 200 farm loans had been sold to Cerberus and have already held talks with senior management from Cerberus on this issue,” he said.

Cerberus has previously said it “treats every borrower fairly and consistently” and that consensual resolutions were always its preferred route.

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