ECB Creates €8 Billion in Cheap Funding for Irish SME’s

I am very concerned about the lack of credit available to SME’s at this stage in our recovery. There is one upcoming opportunity that has the potential to create up to €8Bn of cheap funding for Irish SME’s, but only if the Irish banks get  both fully on board with the scheme and are also transparent about it’s operation. In June the European Central Bank announced the creation of a Targeted Long Term Refinance Operation (TLTRO), this is worth approximately €400Bn in the first phase of this operation. This essentially represents cheap funding for banks with the specific intention that it is advanced as credit to Businesses (excl. financial intermediaries & mortgages) and Consumers (excl mortgages). It appears that Ireland’s share of this fund will be approximately €8Bn. In relation to this actually becoming credit for Irish SME’s there are a few related issues that need to be monitored: 1) The rate banks can borrow at is the European Central Bank (ECB) Refinance Rate (currently 0.15%) + 10 bps, so all in 0.25% financing for the banks. If this money is loaned on to business then it should not be at a rate that creates excess profit. (e.g. if the bank charges 4.75% on the loan then they make 4.5% profit!) 2) There is a risk that Irish banks simply do not access the TLTRO and therefore forego an opportunity to increase business credit (they must apply by early September for the first tranche with a second opportunity to apply in December). Banks should reveal how much of the TLTRO they are entitled to (7% of their existing qualifying loan book) and more...

Council Motion to Target Rates Reduction and Create 113 Jobs

I recently put forward the following council motion to DLR Co. Co.: Motion: “That this Council considers the establishment of a Commercial Rates Relief Fund equivalent to 2% of the 2014 Rates collection, and that this fund is used to pay the 2014 Rates bill of successful applicant businesses qualifying on the following criteria:  Receipt of assistance ensures that at least one full time job is either created or saved AND The qualifying business is either a start up or an existing business that increases it’s long term viability by receipt of temporary financial assistance” I brought this motion for two reasons: Firstly, I believe that when we come to framing the 2015 budget we should give due and serious consideration to promoting local enterprises. As Councillors we are elected for a 5 yr term, and therefore have responsibility for the financial health of this county beyond the short term time frame of just the next financial year. We have many responsibilities and many services to provide on a limited budget. But we must also make sure that we have adequate resources year after year in order to be able to meet the financial demands of running the county. To create economic activity and enable future growth we must be prepared to invest. Commercial businesses and enterprises in the county provide a not insignificant portion of our annual income, it is therefore in our interest to take measures to ensure the continued growth and success of local enterprises. Our ability to provide services into the future is tied to the economy of the county. The second reason that I proposed this motion, is...