Michael McGrath (Cork South Central, Fianna Fail)
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85. To ask the Minister for Finance if the Strategic Banking Corporation of Ireland can accelerate its lending activities, focusing in particular on assisting small and medium-sized enterprises exporting to the United Kingdom; and if he will make a statement on the matter. [19009/16]

Michael Noonan (Limerick City, Fine Gael)
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The Strategic Banking Corporation of Ireland (SBCI) began lending in March 2015. Its goal is to increase the availability of funding to SMEs, at a lower cost and on more flexible terms, than has been available in recent times on the Irish Market. The SBCI channels its funds through lending partners known as on-lenders. The SBCI currently has three bank and three non-bank on-lending partners.

To the end of December 2015, in its first nine months of operation, the SBCI has lent almost €172 million to c.4,600 SMEs, with broad coverage across various business sectors and regions.  The SBCI publishes results biannually and will publish results for the first half of this year in July 2016.

The level of lending to SMEs is to a large degree driven by market demand, and the SBCI is engaged with a range of potential new on-lenders to broaden its distribution capability and market coverage.  In doing so, the SBCI is seeking to deliver a wide variety of types of funding including those that support export orientated SMEs. 

The SBCI will announce a new on-lender in the coming week, who will use SBCI funds to provide working capital finance products to the Irish SME market.  Discussions are progressing well with additional on-lenders, and it is expected that further announcements may be made in the coming months.

It may also interest the Deputy to note that an interagency Export Finance Working Group with membership drawn from my Department, the Department of Jobs, Enterprise & Innovation, Enterprise Ireland, ISIF and the SBCI is currently progressing the development of a pilot financial product that would support the exporting activity of Irish SMEs.

In relation to the UK Referendum on membership of the EU, my officials met with multiple stakeholders, including the banks, to discuss preparatory actions for the outcome to the Referendum.  I understand that banks have put in place resources to support their SME customers who could be affected including:

- Dedicated information resources on Brexit (i.e. teleconferences, websites, questions and answers documents);

- Daily market commentaries distributed to SMEs; and

- Additional treasury and support staff to answer customer queries.

Following the outcome of the UK Referendum on membership of the EU, I expect that the banking sector will:

- Continue their high levels of customer engagement, particularly in relation to treasury and foreign exchange matters;

- Engage directly with Enterprise Ireland in relation to supporting exporting SMEs; and

- Make available finance to viable business cases to support SMEs entering new export markets outside the UK.

Intensive contacts will continue between State bodies and the banks so as to respond to developments in the coming weeks and months.  Indeed, the Heads of Business Banking in AIB, Bank of Ireland and Ulster Bank have met with the Board of Enterprise Ireland to discuss the potential impact of Brexit on exporters and SMEs.