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Strategic Banking Corporation of Ireland

Dáil Éireann Debate, Tuesday - 22 January 2019

Tuesday, 22 January 2019

Questions (115)

Billy Kelleher

Question:

115. Deputy Billy Kelleher asked the Minister for Finance the status of the process to review the Strategic Banking Corporation of Ireland by the NTMA. [2407/19]

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Written answers

The Strategic Banking Corporation of Ireland, known as the SBCI, has been Ireland’s national promotional institution since it was established in September 2014. The SBCI’s role as a national promotional institution is to focus is delivering effective financial supports to Irish SMEs, facilitating the availability of appropriate and flexible finance to Irish small businesses, and encouraging competition and innovation in the SME finance market.

As the Deputy will be aware, since the SBCI began its activities in March 2015, the total amount of SBCI supported lending activity, including loans made under the SBCI’s risk-sharing guarantee schemes, was €972 million to 24,002 Irish SMEs supporting 129,300 jobs. The SMEs who received SBCI finance are from all sectors of the Irish economy and have a wide geographical spread, with approximately 85% of loans going to small businesses outside Dublin and 26% of loans going to the agriculture sector.

The Minister for Finance is the sole shareholder in the SBCI and a significant amount of SBCI activity is supported by a State Guarantee from the Minister for Finance; this is provided for in the Strategic Banking Corporation of Ireland Act 2014. Such guarantees constitute a contingent liability on the State’s balance sheet, as the Deputy knows.

As the fourth anniversary of the SBCI incorporation has now passed, it is timely and opportune to engage an independent external consultant to undertake a review of the SBCI and its activities as part of developing its future strategy. It is also important from the perspective of prudent and sustainable management of public finances and best practice for such reviews to be undertaken.

To complete this process, the NTMA issued a public Request for Tender on etenders.gov.ie on 8 January 2019 for those services with a deadline for receipt of tenders of 25 February 2019. I am advised that it is anticipated that a contract will be awarded in March 2019 and the review is expected to be completed within approximately 8-10 weeks.

The SBCI is a valuable policy instrument for supporting Irish small businesses which are vital to sustainable economic growth and development and employment in Ireland.

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