The president of the Irish Creamery Milk Suppliers’ Association (ICMSA) has called on the Oireachtas Finance Committee, due to hear from AIB about the 90% ‘write-offs’ given to some borrowers, to ascertain the basis and criteria for those particular debts to be written off after the financial crash.
Stating that there is a growing level of dissatisfaction with the bank’s explanations so far, Pat McCormack said that it was not going to be good enough for bank executives to “wave away” legitimate questions about how AIB had selected those borrowers lucky enough to have their outstanding debts effectively written off.
The ICMSA president said that in the farming sector, his association was aware of numerous cases where AIB had aggressively moved to take possession of lands and property that had been offered as security for loans, on which individual farmers had defaulted.
AIB write offs
McCormack also referred to the “very unproblematic” way in which pillar lenders – including AIB – had sold ‘problem loans’ onto so-called ‘vulture funds’.
McCormack has asked the question as to why this option was not considered for the lucky 1,900 borrowers who had their debts written off.
The ICMSA representative has claimed that in normal circumstances, any bank would be able to retreat behind a plea that such information was ‘commercially sensitive’ and assert that it was the bank’s decision alone on who was, or was not, to be extended a loan ‘write-off’.
He added that the circumstances that applied a decade ago were categorically not ‘normal’ and that the state – the Irish taxpayers – were ultimately the party extending these write-offs as decided upon by AIB management.
“Every taxpayer in Ireland was an owner of AIB and was therefore the party extending those write-offs,” McCormack said.
“ICMSA thinks that – in that capacity – we are entitled to know on what basis the management in AIB decided who got those 90% write-offs. More importantly, who didn’t get those write-offs and why?
“And I’m asking for the hundreds of farmers who we have worked with and who have had to defend their farms and homes from ‘vulture’ funds and who are still – a decade later – working through the courts to restructure debts that are usually much less than €9.7 million,” McCormack added.
“Doubtless there will be a good, sound and rational basis for all those 1,900 decisions. And I, and the hundreds of thousands of citizens who effectively owned the bank at that time, look forward to hearing them explained.”