Banks Have 'Shut Up Shop', Claims ISME

A survey indicating that banks have refused more than half the number of requests for loans and overdrafts, has prompted small business to claim Ireland's banks have "shut up shop".

The finding published this morning focused on Bank's behavior in the past three months. The research was carried out by the Irish Small and Medium Enterprises (ISME) organisation.

The ISME claims that the banks have shut up shop and that business closures and job losses are directly linked to a lack of credit.

ISME's Chief Executive Mark Fielding said Government intervention is required to save thousands of businesses.

Last week, the Irish Banking Federation claimed it was getting back to "real banking" by working with small and medium sized businesses, which it said were "the backbone of our economy".

Speaking last week to the society of Chartered Accountants Ireland, Chief Executive of the Irish Banking Federation Pat Farrell said: "Banking is many things. We have a diversity of expertise and experience within our sector. However, when I say that we need to return to the real business of banking this means a renewed focus on two key areas – working with SMEs and supporting homeowners.

"SMEs are the backbone of our economy – they are productive, generate employment, drive exports and offer services in all parts of Ireland. And, with their range of activities, SMEs are a vital part of the banking business in this country."

Mr Farrell went on to say that there were 70,000 approved credit applications and a drawdown of more than €2.6 billion in loans, finance and leasing to small and medium enterprises in 2009.

(DW/GK)