James Bannon (Longford-Westmeath, Fine Gael)
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Question 17: To ask the Minister for Finance if he is satisfied that the covered financial institutions are meeting the needs of Irish business. [24699/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The only recapitalised banks which are significant lenders to the SME sector are AIB and Bank of Ireland. In relation to the credit package agreed in the recapitalisation of February 2009, both my officials and the Financial Regulator receive quarterly progress reports in relation to the lending commitments made. The performance of the banks in this regard was published in the NAMA supplementary information booklet (blue book) with both AIB and Bank of Ireland sanctioning more than €2.5bn each of new business in 2009.

In the context of NAMA and the associated recapitalisations I sought further contributions to economic recovery from the banks. In my statement on 30 March I announced further specific lending targets on the main business banks, AIB and Bank of Ireland. They will make available for targeted lending not less than €3 billion each for new or increased credit facilities to SMEs in both 2010 and 2011. The two banks have each submitted SME lending plans for 2010 and 2011 in light of the €3 billion target. These plans are being reviewed by my officials and Mr. John Trethowan, the Credit Reviewer.

A monitoring / reporting structure is being put in place which will ensure that banks honour their commitment to increase lending to the real economy.