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E-mailLending Assistance
Bank of Scotland Ireland has said it will lend €1 billion to consumers and businesses in 2009.
Announcing details of the new lending initiative, the bank said that it has seen unprecedented demand for lending over recent months as the credit crunch bites.
The €1 billion will be made up of €900 million in loans and €100 million in venture capital funding. The bank may take a small stake in the firms it lends to.
Last week the bank announced details of a €100 million initiative aimed at the first time buyer mortgage market. That money is part of the €1 billion fund.
The bank said a further €100 million would be made immediately available to support the hotel industry, which has been hard hit by the slowdown in the Irish and global economies.
The fund is substantially bigger than the €250 million fund announced on Monday by Bank of Ireland. And there may be more money to come, as both banks say they are in advanced discussions with the European Investment Bank to access its €30 billion fund for small business to strengthen support for the sector.
The chief executive of Bank of Scotland Ireland, Mark Duffy, said that in recent weeks customers had been contacting the bank in unprecedented numbers complaining about the lack of credit in the economy.
He said the loans given from the fund will enable many small companies to stay in business. The funds will be allocated in the next four to five months to both existing and new customers.
The bank says it will make further announcements about where the money will be targeted over the coming period.
Jim Curran of the Irish Small and Medium Enterprises Association said the move was a step in the right direction, and other banks should take similar action to help businesses.
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