Personal insolvency arrangements have been approved by the High Court allowing two Tipperary women write down millions of euro of debts owed to banks and an affiliate of the global investment bank Goldman Sachs.
Sisters-in-law Una and Margaret Kinsella have total debts of €8m. The terms of their Personal Insolvency Arrangements (PIAs), include that they will continue to make payments on the mortgages on their respective homes and they will each make lump sum payments of €100.
Out of those payments financial fund Ennis Property Finance, which is an affiliate of Goldman Sachs, will receive €182.
Keith Farry Bl for the Kinsella's Personal Insolvency practitioner, Mr Alan McGee, told the High Court the PIAs were more advantageous to their creditors than if they were to be adjudicated as bankrupts.
It would allow both applicants retain their family homes and return to solvency within 12 months.
The women’s debts of €3.36m to Ennis Property Finance, which was an unsecured debt, arouse out of personal guarantees they gave in respect of loans, which were acquired by the fund, advanced to the business of their husbands.
The PIAs were formally approved by Mr Justice Mark Sanfey at the High Court today.
Counsel told the court that Una Kinsella of Roscomroe, Ballybritt, Roscrea, Co. Tipperary, had debts of approximately €3.8m owed to AIB, Permanent TSB and Ennis Property Finance.
Under her PIA, the 45-year-old,mother of three dependent children who works as a carer, will also sell investment properties she has an interest in which are located in Co. Offaly and are worth a total of €190,000.
She owes €356,000 to AIB in respect of the mortgage, which is a secure debt, on her family home, which is worth €195,000.
Under the PIA the mortgage has been restructured, with part of the debt written off, so that she will make repayments of €607 per month over the next 20 years.
She will also make a lump sum payment of €100, of which €94 will go to the fund.
Margaret Kinsella of Clashroe, Ballybritt, Roscrea, counsel said, had debts of €4.2m owed to Ennis Property Finance, Bank of Ireland, Ulster Bank, AIB and the Spanish Bank, Banca March.
Under her PIA the 50-year-old mother of one will also sell investment properties she has an interest in. She owes €257,000 to Bank of Ireland in respect of her family home which is valued at €200,000.
Under the PIA her mortgage will be restructured, with part of the debt written off, that will see her make repayments over the next 20 years of up to €650 per month.
She will also make a lump sum payment of €100, of which €88 will go to Ennis Property Fianance.
Despite the small lump sum In both cases, Mr Farry said the creditors do better under the PIA than compared to if the Kinsellas were adjudicated bankrupt.
There were no objections to the PIA being approved by the court.