Dáil Éireann Debate, Wednesday - 15 January 2014
128. Deputy Dara Calleary asked the Minister for Finance if AIB has met its small and medium enterprise lending target of €4 billion as per Government target for 2013; the way this target was made with reference to totally new lending, to restructuring of existing facilities, to moneys advanced for the purchase of assets such as machinery, vehicles and so on, to commercial mortgages provided; and if he will make a statement on the matter. [1139/14]
View answer129. Deputy Dara Calleary asked the Minister for Finance if Bank of Ireland has met its small and medium enterprise lending target of €4 billion as per Government target for 2013; the way this target was made with reference to totally new lending, to restructuring of existing facilities, to moneys advanced for the purchase of assets such as machinery, vehicles and so on, to commercial mortgages provided; and if he will make a statement on the matter. [1140/14]
View answerI propose to take Questions Nos. 128 and 129 together.
As the Deputy is aware, the Government has imposed SME lending targets on AIB and Bank of Ireland for the three calendar years, 2011 to 2013. Each bank was required to sanction lending of at least €3 billion in 2011, €3.5 billion last year and €4 billion in 2013 for new or increased credit facilities to SMEs. Both banks have achieved their 2011 and 2012 targets.
The latest SME lending figures received from Bank of Ireland and AIB cover the period to end November 2013. Therefore I cannot provide the information required by the Deputy at present in relation to the banks meeting the €4 billion target.
For reasons of commercial sensitivity, I cannot provide a breakdown of the target as requested by the Deputy. However, the Credit Review Office (CRO) has previously noted that restructuring and refinancing is important in terms of sustaining the businesses and the associated jobs.
AIB and Bank of Ireland are expected to lend to viable businesses in all sectors of the economy and to address the needs of SMEs in financial difficulty. The CRO is available to assist businesses which have been refused credit. The CRO is currently overturning 55% of the refusal decisions referred to them and anyone who has been refused credit by the banks should avail of the services of the Office.
Access to finance for SMEs was a key aspect of the Action Plan for Jobs 2013 and will be a core element of this year’s Action Plan for Jobs. It is the Government’s vision that all viable businesses operating in Ireland should have the opportunity to access sufficient finance to meet their enterprise needs in a manner that supports growth and employment in the economy.
It is vital that the banks continue to make credit available to support economic recovery. However, it is not in the interest of the banks, businesses or the economy for finance to be provided unless the business is viable and has the capacity to meet the interest payments and repay the sum borrowed.
