Tánaiste announces terms of reference for Credit Supply Clearing Group

The Tánaiste and Minister for Enterprise, Trade and Employment, Ms. Mary Coughlan, T.D., today (Tuesday, 19 May 2009) announced the agreed terms of reference for the Credit Supply Clearing Group established in conjunction with her colleague, the Minister for Finance, Mr. Brian Lenihan, T.D., and to include representatives of the banking and business sectors. The Clearing Group will be charged with identifying specific patterns of events or cases where the flow of credit to viable projects appears to be blocked, and to identify credit supply solutions.

The Tánaiste said: “The current availability of credit to business is a huge issue for our small and medium sized businesses as they trade through the current economic downturn and work to protect jobs in our economy. The establishment of the Credit Supply Clearing Group will build upon the actions already taken by this Government to stabilise the banking sector and ensure that the banks meet their commitments under the recapitalisation package. It will seek to identify areas where credit to good businesses appears blocked and work to find viable solutions for those sectors.

“The independent report on credit availability is due next month and its contents will inform the work of the Credit Supply Clearing Group. The Group will also provide an opportunity for the business community to engage with financial institutions and provide a mechanism for lenders to address how their stated credit policies match realities on the ground in their branches nationwide.”

The Tánaiste outlined the following terms of reference for the Credit Supply Clearing Group:-

• To identify specific patterns of events or groups of cases, by sector, geographically, or otherwise, where the flow of credit to viable business appears to be blocked.
• To aggregate the details of individual cases brought to the Clearing Group’s attention in order to identify patterns
• To seek to identify credit supply solutions relating to these patterns
• On an exceptional basis, to consider significant, individual viable cases where the flow of credit appears to be blocked and which either appear to illustrate a trend or are economically significant in their own right.
• To provide a mechanism for lenders to address how their stated credit policies match the current realities of business lending.
• To develop an overall view of business credit problems.
• To report to Government on a regular basis the issues addressed by the clearing group and any solutions found.

The Tánaiste outlined the proposed membership of the Credit Supply Clearing Group, which is to be chaired at Assistant Secretary level, as follows:

The Tánaiste concluded saying that occasional additional participation in the group may be permitted where the circumstances warrant.

ENDS/ETE2048