Dáil Éireann Debate, Wednesday - 6 April 2016
169. Deputy Pearse Doherty asked the Minister for Finance his plans to develop local or public banks based on the Sparkassen model here, directly or through facilitative legislation or regulation; and if he will make a statement on the matter. [6161/16]
Amharc ar fhreagraMy Department have examined the concept of local public banking and its potential for Ireland. Officials examined how local public banking, with a focus on supporting SMEs, could complement existing Government policy and other initiatives already in place in a range of areas such as improving competition in the banking market, augmenting competition and innovation in the SME finance market and regional development.
Local or public Banks, such as Sparkassen in Germany, focus on the needs of SMEs in their catchment area rather than profit maximisation. This is very similar to the business model of the Strategic Banking Corporation of Ireland. It is encouraging to note that to the end of December 2015 almost €172 million has been lent through the SBCI to approximately 4,600 SMEs across Ireland in a wide variety of sectors and regions.
Additionally, the Government has to date delivered a number of initiatives that already support increased access to finance for SMEs such as: The Supporting SMEs Online Tool, the Credit Guarantee Scheme, Microenterprise Loan Fund, Local Enterprise Offices and the Credit Review Office. Given the significant SME supports that have already been put in place by the Government to support SME financing it is not clear at present how local public banks could create a distinct product offering that would avoid replicating supports that are already available.
The Department of Finance, working with other relevant Departments and Agencies, will continue to monitor and analyse the SME finance market in Ireland and will keep the concept of local public banking under review within the parameters of overall banking policy. This will be done with a view to taking appropriate actions as warranted in order to ensure that SMEs in Ireland have the opportunity to reach their full potential in terms of growth and employment generation.
