Mar 11, 2010

CALL TO ACT ON CREDIT CRISIS IN FARMING

ICMSA President, Jackie Cahill has called on the new Financial Regulator to urgently address the credit crisis in farming and SMEs.   We cannot afford any more delay while we wait the full establishment of the Financial Regulators team.   Mr. Cahill, who is meeting the Tánaiste this afternoon in Dublin said that for over a year now the ICMSA has made proposals to the Financial Regulator and the Minister for Finance on the need for action to address the credit problem in farming.   However, in a nutshell, nothing has been done.  

He said that there were three major issues that required immediate attention.   First, the availability of essential and seasonal working capital for farmers.   Secondly, the outlawing of excessive and unjustified hikes in interest rates being charged by banks. Thirdly, the need for restructuring of existing borrowings over a longer period of time.  

Mr. Cahill said that farming, because of the security which banks hold on farm land in Ireland , is a low risk sector yet it is being penalised and this is causing a danger to the survival and recovery of the sector.  

The time for talking is over and I am proposing that the Tánaiste now sets out a clear mandatory set of rules to restore a functioning banking service to farmers.   The current code of practice, which was introduced last year, is useless and furthermore is not being enforced by the Financial Regulator.  

Finally, Mr Cahill said that it was his view that this direct intervention by the Government through the financial regulator is now required.  

Banks are concerned about one thing only and that is their own survival.   This is no basis to commence re-building a proper and functioning banking system for the productive sectors in Ireland .  

Ends.     11 March 2010

Jackie Cahill,

ICMSA President          087-2020663

Or

Ciaran Dolan,

ICMSA General Secretary        087-2322010

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