€50m fund to drive loan competition
Competition in farm loans is expected to increase with a new entrant to the agri sector launching a €50m fund to provide 'low cost' finance for buying and leasing agri-equipment.
First Citizen Finance has become the sixth lending partner to offer Stategic Banking Corporation of Ireland (SBCI) finance to the agri-sector.
Nick Ashmore, CEO of the SBCI described the move as "another key step in delivering low cost, more flexible funding" to the Irish agri-sector.
The area already accounts for 26pc of all SBCI loans which offers €800m of funding through three banks, AIB, Bank of Ireland, Ulster Bank, and three non-bank lenders, First Citizen Finance, Finance Ireland and Merrion Fleet. It does not fund land purchases.
Chris Hanlon, MD, First Citizen Finance said the partnership with SBCI will enable them to offer loan facilities at discounted rates with repayment spreads of up to seven years for purchase or lease of machinery including tractors, combine harvesters and balers.
EU Agriculture Commissioner, Phil Hogan said he was heartened by the announcement which should provide further benefits to the development of the agricultural sector which is experiencing "a significant competitiveness deficit" at the core of the problem".
The ICMSA's Lorcan McCabe said farmers have been "starved of choice" for bank loans for too long.