Banks should now report publicly on how they are supporting businesses and protecting jobs, SDLP MLAs have said.
All banks operating in NI should report publicly to the Department of Economy on volumes of new lending under the British Government backed scheme, and as a result of the additional liquidity they have received.
The MLAs have warned that tens of thousands of jobs in Northern Ireland hang in the balance because of the Covid-19 outbreak. It is critical that all banks operating in the North must show flexibility and goodwill to assist businesses to survive.
Action by the Financial Conduct Authority to ease bank lending to consumers have been welcomed by SDLP MLAs, but still does not go far enough. More must be done to support both personal and business customers of banks.
The SDLP Economy Spokesperson, Sinead McLaughlin MLA said: “We are hearing from too many businesses in Northern Ireland that banks are not helping them through this crisis. Firms need help. Instead we have bankers declining to implement the government’s financial support scheme as intended. It is time for banks to put the wider economy first.
“The British government has established emergency finance schemes, which it expected banks to engage in. Yet some banks seem very unwilling to do so. If our businesses are not helped, many will crash. It would lead to literally tens of thousands, and possibly hundreds of thousands, of jobs lost. This is an economic tragedy in the making.
“But this is not just about the banks – it is also about the UK government creating a scheme very quickly, which has loopholes. That is understandable, as it was responding to an emergency. And that is why the government now needs to go back to its Coronavirus Business Interruption Loan Scheme and improve it in the light of experience. It also needs to tell the banks – especially those in Northern Ireland – they must engage with our businesses to support them through this most challenging period.”
SDLP Finance spokesperson Matthew O’Toole MLA added: “The UK and Irish governments have supported the banks through their crisis in 2008 and 2009. Now is the time for those banks to support wider society through this crisis."
The largest players in the NI banking sector are either owned or controlled by either the British or Irish states. It is entirely reasonable for them to report clearly to the public in NI what they are doing to support businesses and jobs.”
“It is not good enough for banks to tell business customers or mortgage borrowers that they should stick to the normal terms of trade. It simply isn’t good enough for banks to cite technicalities. They have been flooded with liquidity and they have an obligation to use it.
These times are anything but normal – and the banks must recognise that by providing easy access to loans that will see businesses and individuals through difficulty.
“We need to hold the banks, and bank lending to account. We are calling for Northern Ireland’s banks to report on a weekly basis to both the Department for the Economy and to the public how much emergency support they are providing to Northern Ireland’s businesses and individuals.”