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NI banking woes a drag on SME lending: union

Giving evidence last week to a Northern Ireland Affairs Committee inquiry into the province's banking system, Larry Broderick, general secretary of trade union the Irish Bank Officials Association, said the banking sector was in an increasingly vulnerable position.

Citing a difficult five years that saw extensive branch closures and a tightening of lending, he said staff felt vilified and vulnerable, and had received abuse over the current state of the sector.

The union was also “very concerned” over the situation at RBS-owned Ulster Bank, with the spectre of further job losses and branch closures contributing to low morale among staff and a lack of competition for consumers in Northern Ireland.

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He said: “Our members are concerned at the continued tightening of lending from the banks, despite them saying that money is available.

“There is definitely a resistance at local level to lend, despite the banks saying there is a lack of people coming forward and looking for finance.”

Ulster Bank is expected to publish a strategic review of the business in February.

Mr Broderick’s comments followed those of Wilfred Mitchell, the Northern Ireland policy chairman of the Federation of Small Businesses, who told the committee in October that the banking system in Ulster was “broken”.

He added that an apathy and weariness among small business customers had led to a tacit acceptance that they would not be successful in applying for finance. This prompted Steve Laird, director of Belfast-based IFA Carrington Wealth Management, to claim is “almost impossible to get funding”.

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Paul Adair, director of County Down-based Jigsaw Financial Associates, said: “From my experience, the picture that the big four banks paint is very different to the harsh reality for most customers, who have to jump through lots of hoops when applying for mortgages, with many ending in disappointment. A lack of competition is constraining the market.”