Kieran O'Donnell (Limerick East, Fine Gael)

Does the Minister of State agree there is a weakness in the review process? It has a limit of €250,000 and takes a "comply or explain" approach. Consequently, Mr. John Trethowan cannot compel the banks to lend. Furthermore, does the Minister of State agree there is a need for a bank guarantee scheme to complement the credit review process? For example, if a loan application was for €110,000 but the bank only felt comfortable with lending €90,000, the guarantee would be for €20,000 and simply would guarantee the excess.

I have heard from internal sources within the banks that at present, they are more concerned with shrinking their loan books and collecting money, and the SME sections within banks are not getting the attention they deserve. The Minister should propose to the banks that they should set up specific designated and firewalled SME sections. Instead, banks are more concerned at present with shrinking their balance sheets and sweating their assets and, consequently, the SME sector is falling out of the equation.

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