Two of the biggest banks in Ireland have been informed they need to increase the amount of money they loan to small and medium-sized enterprises (SMEs).
Under new rules set out by the Department of Finance, Bank of Ireland and Allied Irish Banks will be required to offer a combined €15 billion to companies of this size over the next two years, the Irish Independent reports.
As part of revised targets detailed in the Credit Review Office's (CRO's) quarterly report on SME lending, it was shown that each of the financial institutions need to provide €3.5 billion this year, followed by an additional €4 billion across 2013.
John Trethowan, head of the CRO - set up in 2009 - hit out at the lending policies of banks in the country, claiming the strategies are often stricter than they need to be.
The industry figure stated there are "too many cases where the fundamental and common-sense question of whether the bank will get its money repaid is being crowded out by adherence to overly rigid lending policies."
By Tony Aynsley