Wednesday, 27 February 2013

Questions (78, 79)

Peadar Tóibín

Question:

78. Deputy Peadar Tóibín asked the Minister for Finance the steps he is taking to deal with the issue of debt overhang that is impacting on the small and medium sized enterprise sector. [3223/13]

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Peadar Tóibín

Question:

79. Deputy Peadar Tóibín asked the Minister for Finance the meetings that he has had with representatives of the banking sector to address the problem of debt overhang impacting on the small and medium enterprise sector especially amongst small business and micro business. [3224/13]

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Written answers (Question to Finance)

I propose to take Questions Nos. 78 and 79 together.

Debt overhang and SME arrears are issues which impact on the ability of a SME to meet its existing commitments as well as hindering its ability to secure additional credit which it may need. I meet regularly with representatives of the banking sector about all aspects of the economy and this is a topic addressed in those meetings.

The Central Bank has acknowledged that the work already done by banks on mortgage arrears needs to be matched by the banks’ efforts on their small business portfolios. There has been engagement by the Central Bank with the lenders on their approaches in this area and this will be a major area of focus for the Central Bank in 2013. It will encourage a clear strategy, better specialist skills and operational capabilities within the banking sector and a more determined effort to work through the existing stock of troubled loans to try to recover or resolve individual cases.