Firms’ credit flow improves

THE recapitalisation of the country’s two main banks – AIB and Bank of Ireland – has improved the flow of credit to the small business sector, according to the body which was established to oversee corporate lending patterns of NAMA-related banks.

The second quarterly report from the Credit Review Office (CRO) published yesterday showed that the two banks processed 114 internal reviews of decisions on loan applications, during the last quarter, and 86 of those were upheld, 20 reversed and eight are still under review.

The CRO has agreed with the banks in 12 of the 19 applications it has reviewed since its establishment in April.

CRO chief John Trethowan said that he was confident that the improvement can be maintained, and won’t be just a positive blip, but admitted more progress is still necessary.

“Current market perceptions that banks aren’t lending to SMEs is based on experiences from six to nine months ago and the current situation, while still not entirely perfect, is now continually improving,” he said.