Strategic Banking Corporation of Ireland

During Ireland’s exit from the EU/IMF programme in late 2013, the Taoiseach and the German Chancellor agreed that the German promotional bank, Kreditanstalt für Wiederaufbau (KfW), would assist in supporting the provision of lower cost finance to the Irish SME sector where access to finance was particularly impacted by the crisis. This initiative was supported by the European Investment Bank (EIB) Group leading to the creation in September 2014 of - the Strategic Banking Corporation of Ireland (SBCI) – a state promotional institution for Ireland.
The SBCI was mandated to identify market failures and deliver access to finance solutions through lower cost longer term finance to Irish business while increasing competition to the market place. The SBCI’s initial funding was sourced from the KfW, the EIB and from the Irish State through the Irish Strategic Investment Fund (ISIF) and additional funding has since been sourced from the Council of Europe Development Bank and the Funding and Debt Management Office of the National Treasury Management Agency.

The SBCI’s objectives are to:

• Provide Irish business, in particular SMEs, with access to low-cost and long-term finance from multilateral finance providers and State resources
• Channel this finance in a manner that supports productive investment, encourages growth and facilitates employment in the SME sector
• Drive competition in the Irish market for SME lending
• To develop capability to deliver solutions to identified market failures across all Irish business sectors

To deliver these objectives, the SBCI is acting initially through both banks and lending institutions that, in turn, lend to SMEs and, in doing so, pass on the benefit of the lower cost of funds on offer. This operating model also promotes competition in the Irish market for SME finance by facilitating the entry and growth of new market participants. The SBCI currently has a mix of on-lending partners – both traditional banks and non-banks – distributing a range of working capital, investment, leasing, equipment, fleet financing and invoice discounting loans to Irish SMEs. The SBCI commenced operation as a Guarantee Provider in early 2017.

The SBCI has a vital role to play in restoring an effective and sustainable market for SME financing in Ireland and a wider role in the long term as a conduit for State and European financing supports to all business sectors.