Following a meeting last week, the ICMSA has confirmed that the Central Bank is considering issuing a specific guidance document to assist farmers, whose loans have been acquired by so-called Vulture Funds.
The farm organisation had specifically requested the meeting to raise what its President, John Comer, described as “deep concern”.
He says that some farmers have discovered – usually only after the fact – that their loans and farm finance arrangements have been sold or otherwise transferred by regulated banks operating in Ireland to often “faceless and unknown” finance companies, commonly known as Vulture Funds.
Mr Comer said that huge disquiet had been caused by these situations, whereby farm financing and loans had been arbitrarily classified as ‘distressed’ and sold on – often at “very significant, unknown” discounts – to these specialist finance companies who, it was felt, operated on a business model that was radically different to that used by the traditional banking sector.
He added: “This is most assuredly not the situation for some of the anonymous Vulture Funds, who seem to operate on the basis that the sooner they can finalise a loan the better it is for them. These funds do not seem to have the same concern for keeping clients going through what may be a temporary difficulty.
The suspicion is that, quite often, they’re looking for an opportunity to compound the problems being experienced by the farmers in question.
Mr Comer concluded by saying that, while the ICMSA is very aware of the regulatory limits of a guidance document, it’s a start and a step in the right direction.
He said: “It will at least show some of these new arrivals that a certain standard is expected of them and, where they fall short of those standards, the ICMSA will very promptly draw the attention of the relevant authorities to that shortfall.
“Farmers need to know their rights in this regard; the ICMSA is confident that the Central Bank will implement this proposal.”