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Home loan and servicing company Pepper Ireland will stop providing business loans in Ireland, citing “increasingly difficult market conditions.”
The Shannon-based group, which serves some 60,000 residential mortgages on behalf of third parties and also provides financing, informed clients that it had stopped originating business loans here following a strategic review of operations.
It said it will continue to manage and administer the existing facilities and that the move will not affect existing terms and conditions.
The group exited the residential mortgage market in 2018 by selling € 200 million of residential loans to Finance Ireland.
It is now ceasing the commercial loan side of the business while maintaining the asset servicing arm, which employs more than 400 people.
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“Pepper Money’s decision to stop providing more business loans was made after a strategic review and is a consequence of increasingly challenging market conditions, reduced availability of funds, and ongoing volatility and uncertainty,” he said in a email.
A spokesperson said business loans accounted for less than 5 percent of Pepper Ireland’s total revenue in 2019, and its business loan portfolio had about 200 clients.
“The decision means that Pepper Ireland will not originate new commercial loans in the Irish market, and Pepper Money has now ceased all business development activities related to its commercial mortgage products,” he said.
“The decision will not affect existing borrowers who already have Pepper Money business loans. These loans will continue to be serviced by Pepper and the terms and conditions will remain unchanged, ”the spokesperson said.
Other roles
“Reflecting the continued growth of its servicing business, Pepper Ireland hopes to be in a position to reassign the vast majority of the team involved in commercial lending to other functions within its expanding loan servicing business,” he added.
Pepper Ireland manages loans acquired at a discount from other institutions after the financial crisis of 2008, including portfolios acquired from the Bank of Scotland (Ireland) after it was withdrawn from the market here, Permanent TSB and Danske Bank, as well as loans sold by so -The so-called vulture funds.
Last year it took over 3,000 delinquent mortgages from Ulster Bank.
Pepper Ireland had 18 billion euros in assets under management at the end of last year, including approximately 10,000 business loan accounts.
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