New findings show that trading conditions are continuing to improve amongst SMEs, but that demand for credit remains low.

Real reform on capital gains tax for entrepreneurs in next October’s budget needs to be one of the follow-on policies from yesterday’s package of programmes, which were broadly viewed as being friendly to the small business community.

A substantial proportion of the €500m being made available by the Strategic Banking Corporation of Ireland — the State’s new ‘SME Bank’ — needs to be put into the hands of alternative funding providers, rather than the domestic pillar banks for the project to work, it has been claimed.

Taoiseach Enda Kenny will make a significant jobs announcement in Cork this morning as recruitment firm Oxford International unveils a major expansion.

A move away from banks and traditional lenders for small and medium-sized businesses is being debated by an Oireachtas Committee later.

About 35% of Ulster Bank’s €6.5bn SME loan book is distressed, management said yesterday.

Bank of Ireland has pledged to lend €12bn to SMEs over the next five years, saying it is “very much open for business”.

This week’s show features our usual small business round-up and includes a special feature on debt forgiveness for SMEs. Kahlen also explores the glass ceiling with Marion Palmer from Women in Technology and Science (WITS. The Incoming Tour Operators Association also predict another positive year for tourism and John Trethowan from the Credit Review Office talks about banks, small business credit and getting the right information to SMEs.

SMEs have become more dissatisfied with the Government since the turn of the year, with many citing the abandonment of annual lending targets for the pillar banks and a perceived failure to address rising business costs as the main reasons.

The Credit Review Office has said that fresh annual SME lending targets for the main banks are not necessary and that it has seen an increase in appeals for investment capital; suggesting a sustained economic recovery is under way.

IN IRELAND, over two thirds of private sector employment is accounted for by SMEs, yet this group has been particularly challenged since the onset of recession.

The outlook for Irish SMEs is improving, but concerns remain, writes Geoff Percival

The strengthening of the power of the Credit Review Office has been hailed as a potentially key breakthrough in small firms’ ongoing battle to access funding.

The Government placed jobs at the centre of its budget speeches, announcing 25 schemes ranging from tax reliefs to targeting the black economy.

Bank of Ireland and AIB remain on track to achieve their €4bn SME loan approval targets for 2013, but of the amount sanctioned to date only 34% qualifies as new lending, the Credit Review Office has stated.

Measures introduced in last year’s budget have helped create employment and boost the commercial property and financial services sector, according to the Minister for Finance, Michael Noonan.

John Trethowan has said his Credit Review Office will still have an important role to play for at least another couple of years; as an increased number of appeals regarding failed refinancing and working capital requests are expected.

Lending to SMEs fell by nearly 6% — or €1.6bn — year-on-year, during the first quarter of this year, according to data published yesterday by the Central Bank.

The Credit Review Office is lobbying Government to significantly extend the limits to which SMEs can appeal regarding refused funding.

A lack of quality among Ireland’s small business community and a paucity of lending banks in the marketplace are curtailing SME growth, an ESRI-hosted conference heard yesterday.

Banks are being urged to review their process of informing small and medium-size business owners and farmers their request for credit has been rejected.

The pillar banks lack the lending skills necessary for more challenged SMEs looking for credit, according to the head of the Credit Review Office, John Trethowan.

The annual budget has always attracted considerable attention in Irish popular discourse, but the attention devoted to Budget 2013 has reached a whole new level and has been speculated about almost since the minister for finance sat down after his budget speech a year ago.

The Department of Finance has opened a public consultation process on the effectiveness of the Credit Review Office — the body established two and a half years ago to monitor the flow of bank credit to SMEs.

Chambers Ireland has called for a tightening of supports for SMEs and entrepreneurs via tax reliefs, the implementation of a cash accounting system and better promotion of initiatives such as the Seed Capital Programme and recently launched schemes such as the Credit Guarantee Scheme and the Micro-finance Fund.

Debt forgiveness on some outstanding SME loans will be required to deal with the debt crisis, a Dáil committee was told yesterday.

AIB sanctioned a further 3,000 or so loans to small businesses last month, pushing its approval rate for lending to the sector to more than 90%.

Bank of Ireland and AIB have said they remain on schedule to meet SME lending targets, despite fresh criticism from the Credit Review Office.

ISME has said it fears more job losses in SMEs after new figures showed further decline last quarter.

The head of business banking at AIB, John Webb, has admitted that some of its loan application procedures in the past were "over-engineered".

In response to the ninth quarterly review of the Credit Review Office, AIB bank has said they had an approval rate in excess of 90% for small business loans.

The declining number of banks making loans to small businesses in Ireland is of increasing concern because of the need to ensure competition and protect customer service, the credit reviewer said.

Banks which fail to be customer-focused, and which fail to apply creativity and banking skill are devastating the owners of small- and medium-size enterprise when refusing loans, according to the head of the Credit Review Office.

The Government has pumped just over €65bn into bailing out the banking system, and while there is no timeframe for the State’s withdrawal from the sector, there is the prospect that over time it may recover some of its capital investment.

Ireland received its latest report card from the IMF this week and the message continues to be that the student is doing well but has much more work to do to become an honours student.

The Central Bank report on Irish credit conditions drew widespread support from business organisations.

The Credit Review Office is urging businesses that have had credit applications unfairly rejected to contact them.

Three out of four companies in Cork expect profits to remain stable (39%) or increase (36%) over the next 12 months, Cork Chamber’s latest Economic Trends Survey reveals.

More than half of the country’s small business community believes the banks are unwilling to lend, despite new data showing that actual demand for credit remains low.

AIB is giving serious consideration to a finance industry call for “more imaginative” loan structures — such as back-loaded repayments on long-term loans — to drive agri-food growth.

Matt the Threshers, of Birdhill, Co Limerick, was one of the beneficiaries of the Credit Review Office’s judgments allowing the pub to expand into Dublin.

In the last two years, interventions from the Credit Review Office (CRO) has resulted in nearly €7m being advanced to 69 small firms.