Mr. John Trethowan:

I sent in only one document prior to the meeting. I have used it extensively when making presentations to small business groups and accountants and so on. It might be helpful for members to see on one page how we assess appeals to the Credit Review Office. I will highlight a couple of columns in the document because it might be helpful for members to see how a banker thinks at times. The gearing column shows the bank versus other stakes in transactions.

If someone asks a bank for 100% finance, the likelihood is that they will not get it because the bank would be taking all the risk. If a bank lent me €1 million this evening, I would sleep a lot easier than it could. Banks now typically look for a 30% stake from someone else other than themselves being put towards the transaction. Sometimes when SMEs approach the Credit Review Office, this level of funding by the business is not enough.

Very few loans of any substance will be made without security. Banks have returned to being cash flow lenders but I would add the caveat that it is cash flow with security so there must be some element of fallback. In the left-hand column, we can see the capital account and reserves of many businesses that come to the Credit Review Office are very small.