Wexford tycoons invest in Irish mortgages start-up

Wexford businessmen Bert and Lance Allen, former owners of beef processor Slaney Foods, have taken a 40 per cent stake in Nua Money, a company planning to enter the Irish mortgage market.

The Allens’ Lanber Holdings Unlimited vehicle has spent €4 million on the so-called cornerstone stake, according to a new filing by Nua Money with the Companies Registration Office (CRO).

It is understood that the money will help complete the development of Nua Money’s operating platform as it continues to pursue approval from the Central Bank to become a so-called retail credit firm, or non-bank lender, and line up wholesale funding to enter the home loans market.

Nua Money was set up in late 2021 by executive directors Fergal O’Leary (best known in Dublin financial circles for co-founding bond trading firm Glas Securities to trade Irish government bonds at a time of frenetic trading of the State’s debt during the financial crisis), Mark Watson (a former colleague from his time at Citigroup) and three other co-founders.

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“Lanber and the management team believe there is a structural opportunity in the Irish mortgage market, not just as a result of the departure of KBC Bank and Ulster Bank from the market, but primarily by the creation of a proprietary built operating platform capable of disrupting the mortgage-lending process in Ireland,” said Mr O’Leary, Nua Money’s chief commercial officer, responding to questions on the Lanber investment.

The Allen brothers, both in their 80s, sold their 50 per cent stake in Slaney Foods, the parent company of Slaney Foods and Irish Country Meats, to Larry Goodman’s ABP Foods for a reported €250 million in 2016.

The low-profile Allens sold the Bewley’s Hotels chain to the Moran Hotel Group in 2007 for more than €500 million and used much of the proceeds to invest in commercial property in Germany. Dalata Hotel Group subsequently took over Moran Bewley’s in 2014.

Lanber’s collection of investments include wind farms, property development companies, sport horse breeding stables, and hotels in Germany and France.

Their interest in the Irish mortgages sector comes after a period of turmoil for fledgling non-bank lenders in the market.

[ Mortgage holders likely to face two more rate hikes, Central Bank governor says ]

Non-bank lenders that entered the Irish owner-occupier mortgage market in the past five years, including ICS Mortgages and Finance Ireland, were at the coalface as borrowing rates in financial markets and from wholesale funders jumped in 2022 as central banks started to hike rates aggressively to rein in inflation. By contrast, traditional banks’ loan books are funded mainly by cheap deposits.

However, funding conditions in the capital markets have eased in recent months as investors bet that the cycle of rate hikes, which has seen the European Central Bank (ECB) lift its main lending rate from zero to 3.75 per cent since July, is coming close to an end. Still, the ECB is widely expected to increase rates this week and again next month.

Meanwhile, the Irish mortgage market is expected to grow by about 3 per cent this year to €14.5 billion, according to stockbrokers Davy, with lending for house purchases expected to rise 14 per cent to €11.5 billion, even as refinancing and top-up activity falls back.

Glas Securities, which was in business between 2009 and 2014, was responsible for close to 30 per cent of government bond trading in the Irish market during the financial crisis. Mr O’Leary also previously worked for ABN Amro, Lehman Brothers and Citigroup.

Mr Watson, Nua Money’s chief executive, was head of private equity-owned Maltese bank MeDirect for a decade to 2019. He previously worked for Salomon Brothers and Citigroup, serving for a period as co-head of the US banking giant’s global credit markets in London.