Zombie banks of little use to small businesses

ISME, the Irish Small & Medium Enterprises Association, has welcomed research from the Central Bank which stated that small and medium sized Irish companies face significantly tougher lending conditions than similar firms elsewhere in the eurozone. "The recent Central Bank report confirms that access to finance for SMEs is continuing to deteriorate, despite the continuous false assertions of the banks," according to ISME. According to ISME Chief Executive, Mark Fielding, "While the euro area is awash with cheap finance from the ECB and Irish banks have been recapitalised with enormous fiscal injections, the truth of the matter is that these same Irish banks refuse to lend to viable but vulnerable small and medium enterprises". "We must put an end to the fiction that rescued Irish banks are functioning properly," he said. And he argued that the banks, in relation to having a role in economic recovery, were simply "the living dead". "They restrict credit lines, delay decisions, miss deadlines and generally hinder progress, while they themselves are slow to reform, re-educate or restructure," continued Fielding. "The previous government were hoodwinked and misled by bankers on the Guarantee in '08; the present administration seems to be falling for the same clap-trap, telling us that 'SMEs must improve their applications for credit', rather than demanding changes in bank operations and insisting that they partake in a positive way in the recovery," concluded Fielding.