The Sunday Business Post reports that Goldman Sachs and Cerberus, are planning to heighten pressure on Irish borrowers after the election.
US vulture funds were encouraged to come into this country by this government to buy up debt at incredibly low prices. One of them, Apollo, even hired the former chief executive of Bank of Ireland, Brian Goggin, to select the best pickings.
Vulture funds operate on a three year-30% rule where they hold distressed assets for three years and aim at a 30% return.
So after buying up Irish loans at a fraction of their value they are now putting a squeeze on debtors to pay back the full price of their loan.
Many small businesses and owners of rental property will not be able to pay up. Their new owners will then foreclose on them, enabling others to buy them up at a fraction of the original price.
The result will be social dislocation – not just for the debtors but for the wider society.
The state should step in to avert this situation. Banks should be retained in public ownership and a left-wing government should repudiate deals done with the vulture funds.
