26 FEBRUARY 2021
ICSA Rural Development chair Tim Farrell is calling on the Central Bank to ensure that all credit facilities for farmers are protected as Ulster Bank withdraws from the Irish market. “We are particularly concerned about the potential impact on short and medium term facilities. Farmers with stocking loans or overdrafts rely on these facilities for their everyday farming activities. It is vital that these facilities are safeguarded for farmers,” he said.
“Assurances must be given that farming customers of Ulster Bank will be able to access similar short term loan facilities as they move to other banks. Such credit facilities are absolutely critical, particularly for drystock farmers, and in many cases make the difference between being able to continue in business or not.”
ICSA has previously met with the Financial Ombudsman and we have been reassured that term loans which are sold on are still subject to the same terms and conditions. However, the reality is that many loans have small print conditions that leave borrowers vulnerable particularly when they are trying to establish a relationship with a new bank. Obviously, the long standing ICSA policy is that we are totally opposed to loans being sold to vulture funds without the borrower’s consent.”
Mr Farrell said news that Irish pillar banks AIB and Permanent TSB have moved to acquire portfolios of commercial and small business loans from Nat West, the parent company of Ulster Bank is to be welcomed. “This is an important development, and every effort must be made to ensure that these loan books do in fact end up with Irish pillar banks, and not with vulture funds.”
“However, we need to go further to protect the estimated 10,000 farmers with borrowings from Ulster Bank and the further 10,000 with current account facilities. To this end, ICSA is calling on the Central Bank to ensure that there is no change in the availability of stocking loans or overdraft facilities to individual farmers. We do not want to see a farmer being offered a lower overdraft or have stocking loans withdrawn because of the transfer of accounts to AIB or PTSB. Existing credit arrangements must be protected as a condition of this changeover.”
ENDS
