Dr. Anne Finnegan:

From AIB's perspective, the term of the facility, whether it be working capital or capital investment, is typically tailored to meet the nature of the investment. It was no different under this scheme. As my colleague, Mr. Burke, pointed out, the spread of terms suggests there was no pressure within AIB to reduce the term of loans. Only 5% of the funds we have made available to date are for one year.

In trying to alleviate cash flow pressures such as merchant debt or demands from outstanding creditors we review them on a case by case basis and looki at the debt built up relative to the business and why it has built up. We then look at the term the business could sustain without putting undue pressure on it in the medium to long term. While it is a feature of the scheme, it is something we do periodically to relieve working capital pressure in sectors during downturns. One is looking at a period of two to four years, depending on the nature of the build-up of credit and what the business can sustain. Under the SBCI, if one was looking at trading stock which would be sold within 12 months, the appropriate term would have been no more than one year, again without building pressure into the following year. In the case of capital expenditure, we would be looking at longer terms such as four years.