SME Support | FEATURE
John Trethowan, Head of the Credit Review Office.
“I BeLIeve THAT
oUr fInAncIAL
InSTITUTIonS WILL
Be LooKIng very
cArefULLy AT
Any cASe THAT IS
SUBMITTed By US.” – joHn TreTHoWAn
side of the argument, Irish banks are adamant that they are lending, so there is a clear disparity here. With the establishment of this office, business owners have an independent and impartial credit review system where they can bring their credit queries to get a lending decision on a loan application.”
MISSING THE POINT
While the introduction of the Credit Review Office was broadly welcomed, some believe that the lack of statutory powers assigned to Trethowan and his team will mean that the office is powerless when it comes to forcing banks to review a lending proposition. According to Trethowan, that view misses the point.
“We are confident that our decisions will be taken on board by the banks. After all, I have had to liaise with the banks to get the office to where it is today so they know what we are about and who they will be dealing with,” he
insists. “As the Minister for Finance requested this office to be set up in light of the growing inconsistency between the market and the banks on the issue of credit availability, I believe that our financial institutions will be looking very carefully at any case that is submitted by us.” Seán Murphy, Deputy Chief Executive of Chambers Ireland, believes that the lack of statutory powers is not a major issue and that the buy-in to the process from financial institutions involved will be more important in the long run. “We need all of the banks in Ireland to participate in this process; if there is significant participation from the banks involved then loan applications submitted by the Credit Review Office will be acted on and there will be full transparency,” he says. “The real test, however, will be the amount of applicants that come forward to the Credit Review Office. It should give us an interesting insight into the situation that we find ourselves in because there is some ambiguity between what different observers have said of credit availability.”
EARLY DAYS
Murphy is referring to the latest Mazar’s report which indicates that 84 per cent of Irish firms are getting the credit they need, which is contrary to reports that credit is severely lacking to businesses that need it most. While this should be confirmed by the numbers of applicants to Trethowan’s office, Trethowan himself says that it is too early to say exactly what the situation is.
“Right now we are getting some calls from business people querying their position before they use the service,” he explains. “However, we are advising businesses if they have a complaint about lending to appeal to the bank in question first. Frontline managers won’t have as much lending discretion as someone in a more senior position. So, instead of businesses coming to us directly, we are asking them to work with their bank to possibly get a resolution to any issue that they may have. If they are still not satisfied having had their request reviewed by a senior official, we will then take up their case.” “It is important to remember that we are not an ombudsman, despite the fact that we act in a similar way. So, we are stressing the point that applicants should go to their bank first to see if they can resolve any issues themselves before coming to us to get an independent opinion on their case.”
Every effort has been made to make the Credit Review Office as optimised as possible so
that any burden to the tax-payer is limited. Staff – all retired bankers who have been carefully selected by Trethowan – work on a ‘no review/ no fee’ basis. “I have tried to ensure that we are not building an empire here,” says Trethowan. “We only pay credit reviewers for the cases that they review. If we get no cases then they will not get paid. On the other hand, if we are taking in more cases than the six reviewers that are in place can handle, then I have the capability to bring in more reviewers. We will not be taking on permanent employees and have deliberately kept our numbers low until we have a better idea of the number of applicants coming forward.”
So far, only banks participating in NAMA (Bank of Ireland, Allied Irish Banks, Irish
Seán Murphy, Deputy Chief Executive, Chambers Ireland.
“We Are cALLIng
on ALL BAnKS To
PArTIcIPATe In THIS
ProceSS So THe
WIder MArKeT cAn
gAIn An InSIgHT
InTo exAcTLy WHAT HAS Been goIng on.” – Seán MUrPHy
InBusiness May 10 25
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