Ulster Bank pledges £300m to support SMEs
Ulster Bank said today it has set a target of providing £300m in new lending to small and medium-sized businesses (SMEs) in Northern Ireland over the next 12 months.
The figure is an increase of 20% on the £250m that the bank committed to lending to local SMEs last year, although Ulster Bank highlighted it had beat its target and lent more than £290m to around 1,000 businesses over that period.
The increase is in keeping with measures announced in the Budget last month that required Ulster Bank's parent Royal Bank of Scotland to increase its lending to businesses to £50bn from around £41bn in the previous year. Following the Government's bailout in 2008, RBS remains 84% owned by the taxpayer.
Ulster Bank said its lending last year had included an 80% share of all lending by local banks through the Enterprise Finance Guarantee (EFG) scheme set up by the Government to support small firms. Most support had gone to borrowers in agriculture, manufacturing and the wholesale and retail trade, it said.
"We have lent a significant amount to help companies secure, improve or expand their businesses, and we are pleased to have led the way in EFG lending in Northern Ireland, which has allowed access to vital funding for small firms that didn't have the security that would otherwise be required by banks," said Henry Elvin, the bank's head of business banking in Northern Ireland.
"But we would like to have lent more and were constrained in doing so because of lower overall demand due to many businesses deciding not to invest in the current environment. We have also experienced a high level of repayments as businesses try to pay down their debts. The year ahead will also be a challenging lending environment, but we are committed to supporting SMEs where we possibly can, whether that is through the EFG scheme or one of the other lending options we are able to offer.
"Sectors that we are specifically targeting, where we think there will be higher demand, include renewable energy, healthcare and agri-food," Mr Elvin added.