Goldman ‘vulture funds’ collect €390m from Irish borrowers

Beltany and Ennis gathered the money in the space of 13 months

Traders work at the Goldman Sachs Group booth on the floor of the New York Stock Exchange. Beltany collected €284m from Irish borrowers in 2015. Photograph: Peter Foley/Bloomberg

Traders work at the Goldman Sachs Group booth on the floor of the New York Stock Exchange. Beltany collected €284m from Irish borrowers in 2015. Photograph: Peter Foley/Bloomberg

 

Two so-called “vulture fund” distressed loan vehicles associated with Goldman Sachs collected €390 million in one year from Irish borrowers.

Beltany Property Finance and Ennis Property Finance snapped up boom-era loans from banks such as Ulster Bank and Bank of Scotland (Ireland). Most of these loans were secured on commercial property and businesses in Ireland.

Accounts filed this week for Beltany for 2015, and for 13 months until the end of 2015 for Ennis, detail the collections made on their portfolios.

Ennis, whose portfolio includes loans associated with the Glen of the Downs golf club, and also the accountant Alan Hynes, collected €106 million. At the end of 2015, the accounts say, its outstanding loan assets were €767 million.

Beltany is the Goldman vehicle that bought loans associated with developers such as Twinlite, which developed residential units at Tyrrelstown in north Dublin.

Last year, there was public controversy after some residents were asked by Twinlite to leave their homes so that they could be sold, with some of the proceeds due to go to the Goldman fund.

Beltany collected €284 million from Irish borrowers in 2015. At the end of the year, it still owned loans assets with €458 million outstanding.

Legislation

Both funds were set up as special purpose vehicles under legislation known as Section 110, allowing them to operate as tax-efficient vehicles. Both Ennis and Beltany made taxable profits of just €1,000 each over the period, with each due to pay corporation tax of just €250 (section 110s pay double the normal 12.5 per cent rate).

Section 110 rules were brought in to attract foreign derivatives business to Dublin. There was widespread political criticism, however, when it emerged that such vehicles were using section 110 status to legally avoid tax on Irish property assets.

Changes introduced in the budget a year ago mean section 110s such as Beltany and Ennis can no longer claim such tax advantages if they hold Irish property. The accounts for each acknowledge the rules change, but don’t detail the future impact of the new regime on their profits.