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SBCI publishes 2019 progress update and 2018 annual report and accounts

The Strategic Banking Corporation of Ireland (SBCI), Ireland’s national promotional institution for low-cost flexible funding for SMEs, has today published a 2019 progress update and its 2018 annual report and accounts.

Key information

  • 2018 saw the SBCI significantly expand its portfolio of available credit supports for SMEs. This included providing further liquidity to its non-bank on-lending partners, while growing the risk-sharing schemes it delivers on behalf of the government.
  • The SBCI launched its second risk-sharing product in 2018 (the €300m Government of Ireland Brexit Loan Scheme), following the successful launch of its first risk-sharing product in 2017 (the €150m Agriculture Cashflow Support Scheme).
  • The Brexit Loan Scheme, offered through AIB, Bank of Ireland and Ulster Bank, enables eligible businesses to access low-cost loans of up to €1.5 million at a maximum rate of 4% to address the challenges presented by Brexit.
  • 2018 also saw the SBCI develop its third risk-sharing product, the €300m Government of Ireland Future Growth Loan Scheme. This scheme, supported by the Departments of Business, Enterprise and Innovation and Agriculture, Food and the Marine, which opened for eligibility applications last month, will be offered by up to five on-lenders, with AIB, Bank of Ireland, KBC and Ulster Bank indicating their willingness to participate. This scheme will support SMEs making strategic long-term investments. It offers loans of up to €3 million at rates from 3.5% and loans up to €500k will be unsecured.
  • There is a strong geographical spread of SBCI loans across all regions. The south-western region is Ireland’s biggest user of SBCI loans (19.5% of total new loans in 2018)
  • There is also a strong sectoral spread. Agriculture continues to be the largest sector supported by SBCI loans (29.4% of total new loans in 2018), with Construction Services, Wholesale & Retail, Admin & Support, and Manufacturing Services also strongly represented.
  • 70% of loans in 2018 were used by SMEs to invest in growing the business, with 30% used for working capital purposes. As at end-March 2019 the SBCI has supported 26,762 SMEs, with total SBCI loans drawn down from inception exceeding €1 billion for the first time.
  • New on-lenders and additional risk-sharing products are planned this year and beyond.

Comment by Nick Ashmore, CEO of SBCI:

2018 saw the SBCI extend its capabilities as a risk-sharing provider, partnering with banks, non-banks and European institutions to maximise the benefits available to SMEs that need low-cost funding.

We have built on our early years as a conduit for channelling low-cost funding to SMEs to successfully expand our role through risk-sharing, which allows us to meet the needs of a bigger and broader range of SMEs. 

While it is still early days for the Brexit Loan Scheme and the Future Growth Loan Scheme, we are confident that take-up levels will increase in line with greater clarity and certainty emerging on the precise shape that Brexit will take and as businesses seek to make longer term investments.

We will continue to expand our role as an intermediary for the effective use of EU financing supports relevant to Irish businesses and the delivery of additional types of financial instruments which will enable SMEs to grow and scale-up their businesses.”

Comment by Barbara Cotter, Chairperson of SBCI:

I am pleased with the continued progress made by the SBCI in 2018 in establishing itself as a key conduit for European funding and Government Guarantee schemes.

Guarantee Schemes, such as the Brexit Loan Scheme and the Future Growth Loan Scheme, are critical in assisting SMEs in accessing lower-cost, flexible funding which allows them to innovate, invest and grow their businesses.

Furthermore, the SBCI’s ongoing support of its non-bank on-lenders continues to promote competition in the Irish finance market.”

Comment by Paschal Donohoe TD, Minister for Finance and Public Expenditure and Reform:

I welcome the publication of the Annual Report of the Strategic Banking Corporation of Ireland for 2018. I commend the SBCI on the impressive progress made in delivering risk-sharing products during 2018, working with our European partners to do so - in particular, the launch of the Government’s €300m Brexit Loan Scheme that provides valuable working capital support to Brexit impacted SMEs to allow them to adapt and innovate in response to Brexit.

I am also delighted by the recent launch of the €300m Future Growth Loan Scheme that will provide much needed long term investment finance for Irish SMEs.

The SBCI is delivering on its mandate to provide effective financial supports for Irish SMEs and ensure a diverse range of types and sources of finance for them as they provide sustainable economic growth”.