Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

Yes, this is generally in the debate on the provision of credit. It is an issue I dealt with in great detail last night in the House. Certainly the European banks can set up in Ireland and provide lines of credit but the general position on the European banking system is that because of the crisis and the deleveraging which had to take place right across the world, and particularly in Europe, the banking industry in Europe is smaller than it was and there is a difficulty in the provision of credit in certain countries. One approach to that is to strengthen the Irish banking system, which we have done, but another approach is to follow the American example and not to rely so massively on the banks providing us credit and look for alternatives to the tradition of banking system for the provision of credit. We have about €2.5 billion available in the Irish economy from non-bank sources, ranging from situations such as Dell computers getting a banking licence to enable it not only to put information systems into companies but to finance it. That is one alternative. Another is Silicon Valley Bank which has a branch in London and a presence in Dublin, which is putting $100 million on the table for venture capital for small start-ups in Ireland. There are three funds that have been negotiated with the National Pensions Reserve Fund and some lending funds. That is on the record from my speech last night. I gave all the examples of that as well so there is a general movement.

In the European context the most fruitful source of finance is the European Investment Bank. About 18 months, countries contributed extra capital to the European Investment Bank and the net position is that the additional capital leveraged up allows it to lend about €180 billion extra over the next ten years across the European Union. My general secretary is now on the board of the European Investment Bank and we are accessing additional funds there. For example, it has put €250 million into both Bank of Ireland and Allied Irish Banks to fund SMEs. While the source of the funding is the European Investment Bank we are using the pillar banks as a conduit for delivering that money to the SMEs. We will build on this. The idea is that we continue to build on this. The European Investment Bank management will come to Ireland again before Christmas and look at various projects. We think it will be a fruitful source of funding and that is the way it should be.