Mr. Nick Ashmore:

I thank the Chairman and members. We welcome the opportunity to tell the committee about the work the Strategic Banking Corporation of Ireland, SBCI, has been doing to support farmers and agribusinesses throughout Ireland. Joining me today is my colleague, Suzanne Sweeney, head of lending. I am conscious of the committee’s concerns around the recent fodder shortage and its interest in any measures that are open to farmers to help address their financial pressures.

The SBCI is a significant supporter of farmers and the wider agribusiness sector. We have done this through two main channels. The first is the agriculture cashflow support loan scheme, which we deployed through three partner banks, all present today, between January and May last year. This scheme was hugely successful in delivering €145 million in low-cost working capital loans with an interest rate of 2.95% to over 4,000 primary agriculture businesses throughout the country. Demand for this support was so strong that it reached capacity within weeks of its launch, far ahead of our expectations. There was a strong mix of farm categories benefitting from this scheme. Dairy farmers accounted for 45% of the total; beef farmers 40%; tillage 6%; and others, primarily pigs, sheep and horticulture, 9%. There was also a broad-based geographical mix with a particularly strong uptake on the southern and western seaboards and in Border counties.

Our second major channel for supporting farmers has been the low-cost loans we have provided through our network of eight on-lending institutions. These partners currently include three non-bank providers of leasing and asset finance to farmers and give us excellent reach throughout Ireland, facilitating access to a wide range of borrowers. Through this channel we have supported almost 23,000 businesses overall throughout Ireland with low-cost loans, leasing, working capital and other forms of finance totalling over €920 million. We were not surprised to see farmers being among the biggest users of SBCI loans. Taken together, the SBCI with its partners have deployed €330 million, or 35% of total SBCI funding since it first opened for business three years ago, in funding supports to farmers and the wider Irish agricultural sector.

In addition to these direct benefits for the sector, we also have a wider aim of improving the general funding environment for SMEs and farms by stimulating much-needed competition in the financing market. Our strategy is based on supporting new entrants to the SME financing market, both domestic and international businesses, which in turn enhances the level of competition and encourages existing lenders to offer better terms and more innovative products. We also use existing operators to benefit from their wide geographical coverage and gain access to as many SMEs as possible. Ultimately we are aiming for greater diversity in the supply of SME and farm finance, with a wider range of finance offerings and a greater number of finance providers.

Our success with the agriculture cashflow support loan scheme comprehensively demonstrates our ability to act as an effective conduit to the Irish market for similar supports schemes in the future. Building on this, the SBCI recently launched the €300 million Brexit loan scheme, which is there to support businesses impacted by Brexit, especially food businesses which are often customers of the farming sector.

We have included some slides on the activities of the SBCI for the committee’s reference. That concludes my opening remarks. I hope members have found them helpful and we will be happy to take any questions they may have.