Monday 23 October 2017

Strategic Banking Corporation loans up 57pc in six months

SBCI Chief executive Nick Ashmore
SBCI Chief executive Nick Ashmore
Ellie Donnelly

Ellie Donnelly

Loans from the Strategic Banking Corporation (SBCI) to small and medium size enterprises stood at €855m at 30 June 2017.

This represents an increase of 57pc on the €544m in SBCI-supported lending at the end of December 2016.

SBCI loans have now supported 21,132 small and medium enterprises employing 106,728 people, an increase on the 12,593 small and medium enterprises it supported at 31 December 2016.

Read more: SBCI to bring in new lenders to boost SME loans

The increase in loans has been driven by the launch of the SBCI Agriculture Cashflow Support Loan Scheme in January 2017, representing a significant milestone for the SBCI in its efforts to introduce Risk-Sharing products into the small and medium enterprise finance market.

This scheme accounted for €118m by end June 2017 and supported over 3,500 agri-business small and medium enterprises employing over 5,000 people.

"These figures demonstrate the SBCI’s strong impact and the significant appetite among Irish small and medium enterprises including farmers for lower-cost funding that is more flexible and designed to suit their specific needs," Nick Ashmore, CEO of the SBCI, said.

The State-backed SBCI, which has also received funding from the European Investment Bank and German development bank KfW, was set up to channel cheap funding to SMEs via lending partners.

Read more: Cardinal mulls €200m SME credit fund

So far it has provided funds to banks including AIB and non-bank lenders like Billy Kane's Finance Ireland. Other lenders on its platform include First Citizen Finance.

"In just over two years since it started lending, the SBCI has achieved a lot. The pace of SBCI loan drawdowns has grown steadily and SMEs are benefiting from a bigger range of loans and a bigger range of on-lending partners," Mr Ashmore said.

Small and medium enterprises benefitted by an average of 1.15pc versus market rates for loans of less than €250,000, while the agricultural sector continued to account for most of the value of loans (23pc).

The South West of Ireland showed the most SMEs using SBCI loans with over 18pc of loan numbers by region, while Dublin accounted for 14.8pc.

The SBCI plans to announce new on-lending partners shortly, adding to its seven existing partners – three banks and four non-bank lenders.

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