Willie Penrose (Longford-Westmeath, Labour) | Oireachtas source

The rates are between 7.9% and 8.5%. They are getting money for nothing from people. They are giving nothing to people in interest rates. They got billions of euro belonging to the Irish people and that is what they are charging. Farmers, small business and individuals depend on overdraft. They cannot always be running in for a term loan. I will tell the witnesses why. They are withdrawing from rural Ireland. There are very few buildings. There are buildings one cannot meet anybody in. Even Bank of Ireland had to reverse a decision in recent days. Nobody could touch anybody. I ring up looking for Bank of Ireland and I get on to an answering machine in Dublin. Do not tell me I am telling lies, this is from personal experience in the last ten days. Lo and behold, if someone has a personal overdraft - the Chairman should listen to this for the gall - and actually has a bit of business that I would have mixed into it, if he wanted to increase the overdraft from, say, €10,000 to €15,000, the 8.05% would shoot up to 13%. Legalised robbery - that is what they are involved in. They come in here and expect us to listen to this type of stuff. I am sick listening to it. I have spent the last 26 years in here listening to this type of stuff. People are paying the price.

They have some neck. It is only about six or seven years ago that we all suffered because of them. If they had any bit of decency they might come in here with interest rates of 2% or 2.5%. That is what they should be doing to help out the farmers and every other sector. The farmers are only one sector. They should take the small shopkeeper and all of those across rural Ireland. The banks have withdrawn for the most part. The best contact they have if they have someone dealing with them for 35 or 40 years is to face that person face to face. The bank manager would know their people, know their family and everybody. That is not in the game now. How do they handle farmers coming in? They have their deeds and 150 acres worth a substantial bit of money. How do the farmers make contact with the banks now? It is the same for farmers as it is for a small business. They talk into this machine and make their application across the machine and somebody will contact them in seven or ten days whenever they get time.

That is some interest rate. Most farmers are on interest rates of that nature. As Deputy Cahill will tell us, they have to have an overdraft to tide them over when there are unanticipated events. That is what the banks are charging. Would they not start to be decent and reduce the rate to 4% or 5%? That would be a good start. They come in here with a few structured schemes. Fair play to Bank of Ireland; it has a good PR system. It took out its hundreds of millions a day in the farming section of the Independent when it knew it was coming in to face us. Well done. Bank of Ireland is excellent; it knew what was coming.

I am sure a lot of my colleagues who worked in the bank whom I started off with many years ago are now retired. Nearly everyone I started off with has retired; I must be the only rascal left to this thing. Farming is a volatile business in respect of supply, production and price - price takers for the most part. Therefore there will always be a crisis. There was the milk crisis a few years ago. Deputy Cahill and Dr. Byrne are right that pig farming is in a very difficult state. I would like to know what the banks are doing to reduce the cost of credit for farming. Very often the schemes are grand. Bank of Ireland is now extending them to three years, which is very welcome.I will welcome anything that is positive. We have a rate of 3.85% or whatever it is - at least it is competitive.

I read a few weeks ago in one of the business papers that the banks do not want money from SBCI now as they can borrow cheaper on the market. Is that right? I read that and thought to myself that Mr. Ashmore would be becoming redundant. That was my first thought. Maybe I am not right. We were promised a scheme by the Minister nine or ten months ago in the last budget. Surely that scheme could have been accelerated, particularly in the context of the ongoing dramatic events since last November, the snow in February and March and the drought in May, June and early July.

I ask Bank of Ireland if there is a withdrawal from dealing with customers face to face. How does the bank get to actually speak to a person and relate how a loan is structured? How does it relate to somebody who has been with the bank for 35 or 40 years, or five or ten years or whatever?

I welcome Bank of Ireland's indication in its presentation that it is refinancing farmers' debts to other financial institutions, especially those that are exiting the market. Does that extend to refinancing those who are in the grip of vulture funds and who might be in a position to get substantial write-offs once an agreed sum is payable? Through no fault of their own, people may be down for €300,000 or whatever it is. The vulture funds have bought it for damn all, perhaps €40,000 or €50,000, and may be selling it off at €100,000. If it could secured for €300,000 five, seven or eight years ago and now can be bought for €90,000 or €100,000, it surely is good value. Surely, it would be in the bank's interest to look at that in a critical but positive way and ensure that farmers and others can remain in their holdings and try to look after their families in that regard.

I thank the witnesses for telling me about the banks' interest rates because after almost 40 years of dealing with the bank, I did not know it. After taking 24 hours to say to myself that I am some fool, what I worried about then is there must be many fools across the country. That is absolutely scandalous. One could have €100,000 in the bank but would not get 1%. Will the bank look at its overdraft interest, as well as the various schemes and packages brought forward to deal with the various problems that have arisen? Surely it did not take a fodder crisis to trigger within the banks' departments the impetus to set out particular packages for the farming sector, particularly with its volatility and now the traumatic events. Somebody who is present handles small and medium enterprises, SMEs. What way do the banks treat SMEs and small rural shops in particular, which the witnesses probably have written off at this stage like everybody else, post offices or small garages?