The agri-loan book sale represents 5% of an overall €2.5bn loan book sale. The majority (80%, or €100m) of the agri-loan book sale relates to business in the Republic, with the balance (€25m) relating to loans in Northern Ireland.

Last March, the Irish Farmers Journal exclusively revealed that Ulster Bank had been communicating with farmers over the possible sale of “non-performing loans”. Following a number of months of consultation with farmers, these loans have now been sold for an undisclosed sum. However, it is understood to be at a significant discount to the face value.

Although the bank has not identified the buyer of the loans, it is understood that US investment fund Cerberus, which bought the Project Eagle loans from NAMA, are the buyers of the entire €2.5bn loan book.

Land and investment debt

According to a spokesperson for the bank, the agricultural loans relate to land, on-farm investments and non-agri-related investments, which have been under special management in its problem debt management department for a significant portion of time.

An Ulster Bank spokesperson told the Irish Farmers Journal: “We will be in contact with all affected customers in the coming days to help them as their loans transition to their new owner.”

It is understood that Ulster Bank will withdraw current account banking facilities of any customer who has their loan sold to a third party. Ulster Bank must give 60 days’ notice of closure as outlined by the consumer protection code (CPC).