Joan Burton (Dublin West, Labour)
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153. To ask the Minister for Finance his plans to review the operations of Strategic Banking Corporation of Ireland, SBCI, and diversify the range of on lenders by SBCI; and if he will make a statement on the matter. [4159/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Strategic Banking Corporation of Ireland’s, SBCI, mission is to deliver effective financial supports to Irish SMEs and, in time, other sectors that address failures in the Irish credit market, while driving competition and innovation and ensuring the efficient and effective use of available EU resources. The SBCI uses an on-lending model, meaning it does not lend directly. Rather, it channels its funds through lending partners known as on-lenders. The SBCI currently has three bank and four non-bank on-lending partners.

 The SBCI began lending in March 2015. To the end of December 2017, €925 million of SBCI supported lending has been provided to 22,928 Irish SMEs, operating across all sectors of the Irish economy, including agriculture, food, retail, healthcare, transport and manufacturing.

 The SBCI is actively engaging with a range of potential on-lenders, in particular, non-bank finance providers, to broaden its distribution capability and market coverage. This is subject to robust due diligence processes.  The SBCI has an independent board and risk management committee responsible for making the decision to enter into an on-lending agreement. The SBCI's on-lender criteria are designed to mitigate risks to Irish taxpayers and European funding and to SME borrowers. They aim to ensure that all lending partners have the necessary financial strength and capability to provide the required level of service to SMEs along with sufficient protections for the taxpayer.

 The SBCI is working to develop more innovative products, such as the Agricultural Cashflow Support Loan Scheme and the Brexit Loan Scheme I announced in Budget 2017 and Budget 2018 respectively. Additionally, the SBCI is also continuing to work on a number of initiatives, including the continued use of guarantees and risk sharing schemes to support lending by finance providers. These aim to address recognised market failures as well as the collateral limitations or SMEs and collateral obligations of banks.

 The Deputy can rest assured that the SBCI is supporting the provision of appropriately priced, flexible funding to SMEs through a diverse range of finance providers, both bank and non-bank, thereby supporting a competitive and sustainable SME finance market.

Joan Burton (Dublin West, Labour)
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154. To ask the Minister for Finance the work his Department has carried out with Strategic Banking Corporation of Ireland, SBCI to develop loan products targeting agri business and SMEs seeking finance to tackle Brexit-related challenges; and if he will make a statement on the matter. [4160/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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The purpose of the Strategic Banking Corporation of Ireland, SBCI, is to deliver effective financial supports to Irish SMEs as well as other sectors, in time, that address failures in the Irish SME finance market, while driving competition and innovation and ensuring the efficient and optimal use of available EU resources. The SBCI has a vital role to play in meeting the evolving finance needs of the SME finance market, across all sectors and regions, to ensure its sustainable development.

 Additionally, the SBCI has been developing risk sharing guarantee products to enhance access to finance during the course of 2017. As announced in Budget 2017, the SBCI in conjunction with Department of Agriculture, Food and the Marine, DAFM, rolled out a €150 million Agriculture Cashflow Support Loan scheme to provide working capital support to farmers to deal with price and income volatility.

 The SBCI is also tasked with delivering the €300 million Brexit Loan scheme, as I announced in Budget 2018. The Scheme has been developed by the Department of Business, Enterprise and Innovation, the Department of Finance, the Department of Agriculture, Food and the Marine, and Enterprise Ireland. The SBCI engaged with the European Investment Fund, EIF, to utilise an Innovfin counter guarantee facility to support the Brexit Loan Scheme. The purpose of the Scheme is to assist Irish SMEs and Small Midcap firms - less than 499 employees - affected by Brexit with their working capital needs to allow them to diversify and restructure their businesses and adapt and innovate in response to Brexit.

The SBCI is continuing to work on a number of risk sharing initiatives, particularly the continued use of guarantees with European counter-guarantees to support lending by finance providers. These aim to address sectorial market failures as well as the collateral limitations of SMEs and collateral obligations of banks. It is particularly welcome to note that these risk-sharing initiatives are open to banks and non-bank lenders.

 My colleague, the Minister for Agriculture, Food and the Marine, secured funding of €25 million for his Department in Budget 2018 to facilitate the development of potential Brexit response loan schemes for farmers, fishermen and for longer-term capital financing for food businesses. I understand that these are currently under active consideration and more details will be announced as they become available.