Mr. Martin Shanahan:

It is very difficult to predict what the outcome will be in the absence of details on how the strategic banking corporation will work. Therefore, I do not intend to make a premptive comment.

Let me respond to the point made by the Vice Chairman. At the moment one of the issues is that we do not know enough about what the banks are doing in terms of lending, to whom they are lending and in what types of lending in which they are engaged. We do not know if it is roll-over lending, which is important for existing businesses. We do not know if it is new lending or what sectors they are not lending to. We do not have the full picture.

It is important to have a detailed understanding of the lending that is taking place, particularly by the banks that the State supports, because the prescription may be different depending on what the picture presents. For instance, if innovative companies in new sectors are not able to access this funding then making more funding available may not be the answer. It may be educating those involved in the lending process within those banks. It may be increasing the level of understanding of both the sectors and cash-flow lending, particularly where there is not a significant amount of collateral available against the credit being sought. A detailed understanding of what type of lending is taking place is important. Actions to tackle the matter are contained in this year's action plan but I do not think that we understand the situation.