The Kingston story: Bidders fail to pay up for auctioned cows

MIKEKC

Farmer Ed wrote: »

To be fair his side of the story is that he was genuinely trying to buy back the cows for the grandson. Apparently the money to pay for them didn't come into his account as fast as the Sheriff would have liked, but it would be only a matter of days before it would be there. If that is the case,seems stupid for them not to wait rather than having to resell them again.
Also as to where he is getting the money from. Lets not forget that this farm was being run on an American model. Getting outside investors on board, would not be uncommon over there. Possibly that may be where the whole plan fell down as what works in another country may not always work here. The truth is none of us know the full story but the father must be in his eighties and struggling with health complications. It can't be easy for him.

Has his grandson a herd number to transfer the cattle to? To get a herd number he would have to have some land rented or owned plus facilities . Where was he going to put that number of animals.?

RightTurnClyde

Saw this on a uk forum, below



I wonder how much blame should be levelled at the Irish Government? They sold an idealistic dream To our Southern counterparts that once quotas were abolished in April '15 there was going to be an overwhelming and exceptional demand for milk. They, with their advisors and experts in the form of Teagasc, supervised, coerced and nurtured the dream of 50% expansion. Does anyone remember the photos in the Irish Farmers Journal of fellas out celebrating with large glasses of 'lemonade' on the 31st March 2015?!

This was supported by the lending institutions so those already in the industry expanded, beef farmers sold out to buy black and whites and put in parlours. Heck even arable farmers in the Irish Midlands, who'd never had more than a cat or dog maybe a racehorse as a pet, transformed a relatively small 100-200 acre block of land into grass stuck a shed in the middle of the block and put a robot or two in.

Likewise the processors ramped up their capacity with new driers and plants to pump out products for an insatiable Chinese and Russian market (that worked out REALLY well!)

Perhaps this family are the victims of this misguided plan? Perhaps they won't be the only victims of this shambles?



With the current situation in the milk market and milk prices hitting lows that we couldn't have even dreamed of 2 years ago, it's a pity the talking heads aren't out encouraging caution with future plans. If it was okay to preach expansion and spend when prices were in the 30's, equally they should be preaching caution now that prices are where they are.
Or is it a case that when the milk situation gets worse and there are more foreclosures, they'll be out proclaiming that " we thought it was going to be a soft landing, nobody predicted that the bubble could bust"

Brown Podzol

WheatenBriar wrote: »

To be fair,Rabbo put the ACC loan book into a section where customers were actively encouraged to refinance with other banks
What happened here was a refinance probably wasn't possible,during the world financial melt down
The bank has to take a lot of the responsibility here for lending to a proposition which presumably they wrongly thought was viable
Who in ACC scrutinised the business plan?
Tbh,if the bank were any good this would not have happened and they would have invested with a more active involvement as a joint venture or something

This mornings papers have an article stating Peters father cashed in his pension to buy the cows but the funds hadn't reached his account yet

The main reason Rabbo/acc want borrowers to refinance is that most of these term loans are tracker loans, tracking the 3 month euribor, with rates of from .9 to 1.5. They loosing a lot of money on them as today's 3 month euribor is -0.245%. Many farmers have approached them to buy back their loans and refinance with another bank which would be at a much higher rate so would have to acquire their loan from Rabbo at a discount to make financial sense. The answer is always no.

micosoft

flutered wrote: »

1.2m without any grief, i would take it, how are the exes, they will continue to rise, in this type of ball game 1/2m is chicken feed

Lol. Just lol. So basically you think the banking system should work like "we will lend you 2 million. But eight years on you can come to us and say - we will give you 1 millon and you should accept it because of the hassle we will cause? And we will just roll over. And charge higher interest to all the other farmers to make up the loss?

mf240

RightTurnClyde wrote: »

Saw this on a uk forum, below



I wonder how much blame should be levelled at the Irish Government? They sold an idealistic dream To our Southern counterparts that once quotas were abolished in April '15 there was going to be an overwhelming and exceptional demand for milk. They, with their advisors and experts in the form of Teagasc, supervised, coerced and nurtured the dream of 50% expansion. Does anyone remember the photos in the Irish Farmers Journal of fellas out celebrating with large glasses of 'lemonade' on the 31st March 2015?!

This was supported by the lending institutions so those already in the industry expanded, beef farmers sold out to buy black and whites and put in parlours. Heck even arable farmers in the Irish Midlands, who'd never had more than a cat or dog maybe a racehorse as a pet, transformed a relatively small 100-200 acre block of land into grass stuck a shed in the middle of the block and put a robot or two in.

Likewise the processors ramped up their capacity with new driers and plants to pump out products for an insatiable Chinese and Russian market (that worked out REALLY well!)

Perhaps this family are the victims of this misguided plan? Perhaps they won't be the only victims of this shambles?



With the current situation in the milk market and milk prices hitting lows that we couldn't have even dreamed of 2 years ago, it's a pity the talking heads aren't out encouraging caution with future plans. If it was okay to preach expansion and spend when prices were in the 30's, equally they should be preaching caution now that prices are where they are.
Or is it a case that when the milk situation gets worse and there are more foreclosures, they'll be out proclaiming that " we thought it was going to be a soft landing, nobody predicted that the bubble could bust"

Everyone needs to use their own brain. No point blaming politicians.

mahoney_j

mf240 wrote: »

I dont know the man or wish to kick anyone when there down.

But I know in my own area there are a couple of lads that don't like paying bills. They always have a sad story or will play the victim. But yet their lifestyle never suffers.

We all know of them and unfourtnately it's the fools!!!!,like us that pay our bills on time etc that are inadvertently subbing this

longgonesilver

Buford T. Justice V wrote: »

On the above, he claims that the bank had given an oral commitment to provide 250k of working capital, which wouldn't be excessive in a 600cow herd.

The bank reneged on that promise and then the farm was locked up with TB. For a business that depends almost more on sales of stock than milk, that would be a hammer blow, a bit like McDonalds not being able to sell burgers but everything else is ok to sell but a huge chunk of turnover is gone.

I know from experience this past year just how difficult it can be to turnover money with stock sales restricted. I also know from experience that being denied a promise of working capital from the bank can have a severe effect on cash flows that can take years to iron out:o

Tbh, the reporting on this case has disgusted me. There are so many trying to lead the story than follow it and the selective reporting by media of different items confirms to me, anyway, that I have to keep a huge suspicion of items being reported.

My thoughts on this case has changed hugely from the first leaking of items to do with this situation. I have no problem with the grandfather buying the cattle for the grandson and I would be disgusted if the cattle were sold by online auction instead of waiting for 3-4 days for the funds to come through.

While i accept that banks, in some cases, will have to realise their security to repay some or all of the loans, increasingly in this case I am thinking that the bank jumped the gun and decided to send a message to farmers to pay up or else. I am starting to think that letting the farm work and writing off a portion of the loans would have led to most of the loans being paid off and most of the businesses supplying them mostly paid off too.:(

This is one of those posts that you would like to thank, Twice.
These farmers had over 70 bulls for sale every year. They made good money and had many repeat customers. A big reputation built on show successes and milk recordings.
They got locked up with TB for over two years, these bulls went to the factory for salvage value. 160-170 other animals went as reactors for so called compensation(50%? of value).

This caused a massive gap in cashflow, in a business already denied operating capital.

farawaygrass

micosoft wrote: »

Lol. Just lol. So basically you think the banking system should work like "we will lend you 2 million. But eight years on you can come to us and say - we will give you 1 millon and you should accept it because of the hassle we will cause? And we will just roll over. And charge higher interest to all the other farmers to make up the loss?

This remind me of a lad I know who borrowed a few thousand of his well off brother for a family holiday but never paid a cent back. A couple of years later he went looking for more money for another holiday. The well off brother said what about the money you owe me already? "Sure you can add the new loan onto the old loan" said the other brother.

My opinion is swaying a lot in this thread on this situation. Firstly, to go on Ireland fittest family was wrong, should he not have been concentrating more on his business?
If you take out money you owe it back, simple as. If not it screws it up for everyone. Maybe interest rate/term loan can be negotiated but not the principle loan amount. Sure if the bank did that would it not put another lad thinking why am I trying to pay back my loans; I'll stop and get a write down.
Maybe the banks were a bit heavy handed but I don't think this would have came out of the blue, I'd say there would have been a lot of discussions before hand.
How can the grandfather buy back 250 cows? If he put that money into the business maybe it would have saved it? I know it was his own seperate money but desperate times call for desperate measures.
And finally, the way farmers were lead to the slaughter house in regards dairy expansion is dispicable. There should be heads rolling for that. In one way each farmer made up his own mind to expand but it's human nature to keep up and keep trying to get better.
Teagasc and Simon Coveny should be out apologising. They have lost a lot of credibility. I know I was asking was I a fool not to be entering dairy. It wasn't a conscious decision not too, more lack of drive. But thank god I didn't.

WheatenBriar

Brown Podzol wrote: »

The main reason Rabbo/acc want borrowers to refinance is that most of these term loans are tracker loans, tracking the 3 month euribor, with rates of from .9 to 1.5. They loosing a lot of money on them as today's 3 month euribor is -0.245%. Many farmers have approached them to buy back their loans and refinance with another bank which would be at a much higher rate so would have to acquire their loan from Rabbo at a discount to make financial sense. The answer is always no.

Are you saying Rabbo/ACC have not done write downs for Irish customers like other banks have
Of course those deals have happened and do happen but they are nearly always subject to confidentiality clauses which means unless you've been involved in negotiating one,you won't know anything about them or who is up for them on either side
I'd imagine IFAC customers would be an example of those whose firm is big enough to surely know what's possible because it must have done these

freedominacup

cjpm wrote: »

Edited to say that I am totally against fellas loans being written of, and the taxpayer paying the difference. Never saw the sale you are referring to

What do you think happened in the case I outlined? There's none so blind as those who will not see.

Buford T. Justice XIX

farawaygrass wrote: »

This remind me of a lad I know who borrowed a few thousand of his well off brother for a family holiday but never paid a cent back. A couple of years later he went looking for more money for another holiday. The well off brother said what about the money you owe me already? "Sure you can add the new loan onto the old loan" said the other brother.

My opinion is swaying a lot in this thread on this situation. Firstly, to go on Ireland fittest family was wrong, should he not have been concentrating more on his business?
If you take out money you owe it back, simple as. If not it screws it up for everyone. Maybe interest rate/term loan can be negotiated but not the principle loan amount. Sure if the bank did that would it not put another lad thinking why am I trying to pay back my loans; I'll stop and get a write down.
Maybe the banks were a bit heavy handed but I don't think this would have came out of the blue, I'd say there would have been a lot of discussions before hand.
How can the grandfather buy back 250 cows? If he put that money into the business maybe it would have saved it? I know it was his own seperate money but desperate times call for desperate measures.
And finally, the way farmers were lead to the slaughter house in regards dairy expansion is dispicable. There should be heads rolling for that. In one way each farmer made up his own mind to expand but it's human nature to keep up and keep trying to get better.
Teagasc and Simon Coveny should be out apologising. They have lost a lot of credibility. I know I was asking was I a fool not to be entering dairy. It wasn't a conscious decision not too, more lack of drive. But thank god I didn't.

How so?

I expanded my business with quotas and I will continue to improve my business post quotas.

Farmers aren't fools. They made a decision that suited them. If the game changed, as it has countless times before, they will have to deal with it as they have countless times before.

Just as I didn't believe all the world was solid gold at 38c/l, I don't believe the world is sh!te now at 24c/l.

patsy_mccabe

I don't think going on Irelands Fittest Family was a bad move. A welcome distraction from the constant mental pressure of all this, I'd say. Nothing worst than something hanging over your head for years. Believe me, I know.
The problem with debt write-off is, it so open to abuse. Who gets to decide who gets debt forgiveness and who doesn't. Who's to say that it is OK for an exceptionally wealthy farmer to have his debt halved yet ordinary Joe Soap has to take a second job to pay his mortgage.

pedigree 6

mahoney_j wrote: »

We all know of them and unfourtnately it's the fools!!!!,like us that pay our bills on time etc that are inadvertently subbing this

They're in every county. There's lads I know leasing land getting the silage and grazing and not paying a bob for it after. Then same story next year with a different land owner. Then others getting meal from one company not paying getting meal from different company not paying and so on and maybe going back to first company and paying half for last load and on and on. Same thing being done with contractors and tradesmen etc. Unfortunately some are held up as model farmers who we should be aspiring to.

I really think there should be a stubbs gazette type thing for merchants, parlour manufacturers, tradespeople, vets, etc so they won't get caught out.

cjpm

freedominacup wrote: »

What do you think happened in the case I outlined? There's none so blind as those who will not see.

I know full well that it happened. I'm not disagreeing with you. And plenty more got away with the same stroke at the tax payers expense.

NAMA is a shambles.

I just said that I cannot recollect seeing the story you are talking about in the papers, I'm sure it was though.

Skerries Steve

Do not know how people can defend this situation, the bottom line is this son inherited a sizeable farm from his father and decided he had not enough and would gamble with it ,the gamble failed and the banks are the villians now.
If i was foolish/ brave enough to walk into a bookies and put €1000 on a horse and it won at 10/1 happy days but if it lost what reception would i get crying after the race looking for my money back. Life is not a dress rehearsal you live by your choices , this man cannot defend his poor decisions in life, blaming everyone else fo his own shortcomings, it can be seen all over this country children handed things on a plate with no real understanding how lucky they are to be in there position.

flutered

paddysdream wrote: »

Do you seriously believe this?
There is no special god given right to hold onto land no matter how much blood sweat and tears were involved in the getting and holding on to it.

its in the blood sweat and tears, have you farmed in the 50's, the 60's the 70's etc, there was nothing only slavery, if you had a father or mother with the oap it was a massive boon as the messages were paid for, it was another life, a hard demanding life which kept the nation fed and brought in a little foregin money, you need to under stand what the older generation of farmer had to do, back in the day the local bank manager gave out some money on the strenght of a few cattle being sold down the road, first he would call usually on a sunday with a terrier, the terrier would run into the field running around, natuarly the cattle would bunch around the dog, the banker boke would examine the and of course count them, when the money was due to be paid back himself and his dog would call, he knew if the cattle were sold, id they were demand his money back, back then bank managers were of unfortunatly not realy nice people, he was hounding this particular widow woman who was in severe difficultys due to very high death dutys, which no one could figure out why, this was discussed in the pub for a few weeks, as a result a few different men spent a miserable sunday afternoon hidden in a double ditch, until one sunday one got luckey, he had an old stephens shotgun, with a range of 120 yards and a kick like a mule, the a car pulled up a terrier jumped out followed by the owner, suddenly there was a bang, the terrier spun around and lay down, that particula type of banking and money recovery ended, sorry for the long drawn out post

Sam Kade

pedigree 6 wrote: »

They're in every county. There's lads I know leasing land getting the silage and grazing and not paying a bob for it after. Then same story next year with a different land owner. Then others getting meal from one company not paying getting meal from different company not paying and so on and maybe going back to first company and paying half for last load and on and on. Same thing being done with contractors and tradesmen etc. Unfortunately some are held up as model farmers who we should be aspiring to.

I really think there should be a stubbs gazette type thing for merchants, parlour manufacturers, tradespeople, vets, etc so they won't get caught out.

With most big companies if you owe them money the debt will follow you to the grave and end up being taken out of your estate with interest.

pedigree 6

Sam Kade wrote: »

With most big companies if you owe them money the debt will follow you to the grave and end up being taken out of your estate with interest.

Didn't know that. But it's the smaller guys I feel sorry for.
I know a guy did work on a farm went with his bill and was told sorry have no money. There's a tree you can have that.
Now if the owners knew they had no money why get the tradesperson in the first place.:rolleyes:

cjpm

Guys pulling a fast one is going on wholesale.

Fella near me took land 40 miles away for grazing. Kept putting off paying the landowner, an elderly bachelor. On the August bank holiday he went to collect the cattle, so he could disappear without spending a penny.

Farmers nephew spotted the Lorry in the yard. Went down to the Local and rounded up a gang of lads. Confronted my neighbour in the yard and forced him to pay up there and then. Shame on the ****er for trying to swindle an old man.

Balf

I'm trying to understand the idea that repossessed assets are, in some way, anathema with this story

http://www.irishexaminer.com/farming/dairy-herd-dispersal-today-at-well-known-cork-farm-149810.html

A judgement in 2009 finally granted possession of 120 acres of the property to Ulster Investment Bank on foot of an undertaking given in 1986 by Wood for Bula Resources, of which he was then a director.



The collapse of Bula saw the landowner pursued for personal and company guarantees by UIB. The former was settled in 2005, and the latter reached a conclusion in 2009. However, that High Court judgement of 2009 has been appealed to the Supreme Court.



Wood had offered to gift the farm to the state as an amenity area in 2005, a move to offset the proposed northern ring route carving up the estate, and which was touted as providing a Phoenix Park for Cork city by then city manager, Joe Gavin.



However, with no conclusion reached as to future ownership, it looks like the Rockrohan estate will be farmed for the next two years at least, by another pedigree Holstein breeder, Peter Kingston of Nohoval, who will use the farm for some of his prize-winning Cradenhill herd.

coolshannagh28

Too much hearsay on this thread for comfort however a few posters have pointed out an interesting subplot ie poor government and advisory re the end of quotas leading a new generation of farmers into a debt trap , return to the Eircom shares debacle and the property crash and a firm trend is noticeable ,we have an ambivalent attitude to poor regulation and governance. Also it is important to remember that our corporation tax regime is founded on this ambivalence and note that some of the funds taking advantage of that are players in situations such as this one.

paddysdream

flutered wrote: »

its in the blood sweat and tears, have you farmed in the 50's, the 60's the 70's etc, there was nothing only slavery, if you had a father or mother with the oap it was a massive boon as the messages were paid for, it was another life, a hard demanding life which kept the nation fed and brought in a little foregin money, you need to under stand what the older generation of farmer had to do, back in the day the local bank manager gave out some money on the strenght of a few cattle being sold down the road, first he would call usually on a sunday with a terrier, the terrier would run into the field running around, natuarly the cattle would bunch around the dog, the banker boke would examine the and of course count them, when the money was due to be paid back himself and his dog would call, he knew if the cattle were sold, id they were demand his money back, back then bank managers were of unfortunatly not realy nice people, he was hounding this particular widow woman who was in severe difficultys due to very high death dutys, which no one could figure out why, this was discussed in the pub for a few weeks, as a result a few different men spent a miserable sunday afternoon hidden in a double ditch, until one sunday one got luckey, he had an old stephens shotgun, with a range of 120 yards and a kick like a mule, the a car pulled up a terrier jumped out followed by the owner, suddenly there was a bang, the terrier spun around and lay down, that particula type of banking and money recovery ended, sorry for the long drawn out post

Well;
Afraid I only started in the late 1980's to farm so maybe I missed out on all the hardship of the 50's and 60's but also missed out on the boom in the early 70's when Ireland joined the EEC.
We lived from farming alone here since before 1800 on the same land and of course things were different then but that is then and this is now.
It was of course a hard demanding physical life but it was also a much better existence than many others in the country.
All the blood sweat and tears involved may give some people an emotional attachment to the auld sod but gamble big and the chance is that if it goes wrong then it goes wrong big.
Always "gambled" in small amounts because I knew my limitations and what could go wrong.Fair play to those who gambled big and succeeded.Not everyone is cut out for that pressure.
Love the "story" by the way about the terrier.Don't remember John B with that one.

Sam Kade

Hard to imagine the father sitting on that nest egg since he retired.

paddysdream

coolshannagh28 wrote: »

Too much hearsay on this thread for comfort however a few posters have pointed out an interesting subplot ie poor government and advisory re the end of quotas leading a new generation of farmers into a debt trap , return to the Eircom shares debacle and the property crash and a firm trend is noticeable ,we have an ambivalent attitude to poor regulation and governance. Also it is important to remember that our corporation tax regime is founded on this ambivalence and note that some of the funds taking advantage of that are players in situations such as this one.

Bit too much of the personal circumstances of the particular family involved in this story but to be fair they seem to like the publicity going by the amount of interviews and articles in the media.
Paper never refused ink and those who live by the sword etc etc are 2 things people should bear in mind.
All that pension fund thing in today's paper doesn't really reflect well on those involved to be honest.
Know nothing of the people involved but when has that ever stopped Irish people talking about something!!!!

Buford T. Justice XIX

Sam Kade wrote: »

Hard to imagine the father sitting on that nest egg since he retired.

Iirc, once you're 66, you can transfer your pension and buy an annuity for 3/4 of the fund and receive 1/4 in cash.

I'm assuming that is what the grandfather has done and it takes quite a while for the money to be realised from his pension fund.

Sam Kade

Buford T. Justice V wrote: »

Iirc, once you're 66, you can transfer your pension and buy an annuity for 3/4 of the fund and receive 1/4 in cash.

I'm assuming that is what the grandfather has done and it takes quite a while for the money to be realised from his pension fund.

I know if I were pension age investing part of a pension fund would be the last thing on my mind. Maybe he's just stalling things again, time will tell.

greysides

Mod:

Please continue to exercise good judgement in your posting on this thread. It IS available to be seen by members of the family concerned.

coolshannagh28

A lot of what is on the thread is prurient rubbernecking ,the real question is what are the rights and wrongs of moral hazard ,it has been debated to death on other threads in relation to the bank and property crash but how will it affect farmers if dairy prices stay low and banks choose to exercise security on assets with strong emotional ties and follow through on recourse lending principles by selling off stock, machinery and family homes....

freedominacup

coolshannagh28 wrote: »

A lot of what is on the thread is prurient rubbernecking ,the real question is what are the rights and wrongs of moral hazard ,it has been debated to death on other threads in relation to the bank and property crash but how will it affect farmers if dairy prices stay low and banks choose to exercise security on assets with strong emotional ties and follow through on recourse lending principles by selling off stock, machinery and family homes....

Defne moral hazard. As far as I can see it's a term that's been bastardized in an Irish context.

coolshannagh28

freedominacup wrote: »

Defne moral hazard. As far as I can see it's a term that's been bastardized in an Irish context.

Is a bank fund or institution Irish US or ootherwise which has been bailed out by state funds and forced to make provision for bad debt morally entitled to foreclose on a distressed asset such as a farm also bearing in mind that the majority of loans are being repaid in full