Deputy John Deasy asked the Minister for Finance the level of lending to small and medium enterprises by State controlled banks over the past three years.
Reply from Minister Michael Noonan: As the Deputy is aware, the Government has imposed SME lending targets on the two domestic pillar banks 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 in 2012 and €4 billion in 2013 for new or increased credit facilities to SMEs. Both banks have reported that they achieved their 2011 and 2012 targets.
The pillar banks are required to submit their lending plans to the Department and the Credit Review Office (CRO) at the beginning of each year, outlining how they intend to achieve their lending targets. The banks have submitted their lending plans for 2013 to my Department. My Department, in conjunction with the CRO, has analysed the plans and has met with the banks to discuss them. At the end of the first quarter 2013, both banks are on schedule to meet their targets. The Credit Reviewer has stated in his last report that over €8bn was sanctioned by the banks in 2012, of which approximately €2.5bn (27%) is new lending drawn down.
Separately, the Central Bank of Ireland publishes data on lending to Small and Medium Enterprises by all credit institutions resident in the Republic of Ireland, and commenced compiling these data in March 2010. These figures show that total gross new lending drawdowns by non-financial SMEs between March 2010 and December 2012 amounted to €8.7 billion. (Gross new lending drawdowns refer to funds accessed by SME customers during the period which were not included in the previous period’s stock of credit advanced. This excludes the value of renegotiations/restructures that takes place during the period. It is also not equivalent to sanctioning activity, nor does it cover contingent liabilities, such as letters of credit or similar guarantees. Non-financial SME credit excludes lending to certain financial vehicle corporations in the financial intermediation sector, as their balance sheet size brings them into the SME category.) This is available HERE.
The Central Bank of Ireland does not publish these data separately for state controlled banks. Data for March 2013 are due to be published before the end of June.