Mary White (Fianna Fail) | Oireachtas source

I welcome the delegation and have known Mr. Pat Farrell for some years. He has done a very good PR job for the banks and was faultless in his presentation showing everything is perfect with them. I am delighted to meet Mr. John Trethowan in person. He was the fair-haired boy for a while when he agreed with the banks. When he disagreed with them, he became a bête noire. I heard one of the bank bosses claim various new companies were successful when Mr. Trethowan pointed out they had already gone out of business.

Bank lending overall has contracted due to the weak demand in the economy. However, yesterday, Lars Frisell, chief economist of the Central Bank, at a European conference, gave a more fundamental reason. He claimed Ireland's banks face great economic uncertainty and pressure to deleverage which stifles their ability or willingness to supply the economy with credit at reasonable costs. Mr. Trethowan has upheld 55% of the appeals made to his office. Have the banks subsequently agreed to provide the funding?

Mr. Trethowan referred to relationship banking and the centralisation of decision-making on credit applications, the reduction in rural branches and the continuing change of front-of-house staff leading to many small and medium-sized enterprises, SMEs, feeling isolated and remote from their banks. Any of us involved in a SME know that it is all about the character, calibre and capability of the promoter whether the business survives or not. I do not agree with Senator Quinn that the banks are being upfront about their loans. I do not believe anyone seriously in business today would make a presentation to a bank that would not stand up to scrutiny, particularly with the wide availability of computer programmes and so forth for such exercises.

Regarding the €3.5 billion lending targets for the two pillar banks, Mr. Trethowan stated new lending is a vital component of economic growth and is an area in which the Credit Review Office is encouraging banks to be more accommodating. What are the components of this €3.5 billion lending? Why are the banks not more transparent about it? There is a case for including restructured loans in the targets. The same cannot be said for annual overdraft limits which are part of the annual process of cash flow management. Are annual renewals of overdraft limits and invoice discounting included in this €3.5 billion target?

As an opposition spokesperson in the Seanad on jobs, enterprise and innovation, I have harangued the Minister, Deputy Bruton, about the lack of money available for SMEs. I believe he is listening to the banks rather than to the SMEs. While a bank may approve a loan, it may effectively stifle it being drawn down by imposing tough conditions such as personal guarantees. What is the Credit Review Office's experience of this matter?

I am delighted Mr. Trethowan, who is from the North, is head of this office. If we had a united Ireland, the people in the North could be running the show down here as they are so efficient. Mr. Pat Farrell is a master of the seamless presentation of the bank's position.