Former Taoiseach Criticized Banks for Lack of Support for Small Business

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Albert Reynolds,Taoiseach,Banks

Released documents reveal that Albert Reynolds, the then Taoiseach, faced criticism for his outspoken views against banks, particularly their reluctance to aid small businesses. Reynolds argued that banks were excessively profitable and did not adequately pass on interest rate reductions to customers.

Taoiseach Albert Reynolds was accused of 'anti-bank sentiment' after he criticised the banks for their perceived lack of support for small business. Files released under the 30-year rule by the National Archives show Reynolds received a lukewarm response from the banks over his efforts to establish a regular forum for discussions between the government and banking representatives.

As a self-made businessman, Reynolds was frequently critical of the banks, accusing them of excessive profitability and of not passing on interest rate reductions to customers. He told them that they needed to do more for small and medium enterprises (SMEs) especially as their profits had increased fourfold from IR£100 million in 1990 to IR£400 million in 1993. The taoiseach noted the large extent of criticism of the banks by representative bodies for small business and told the bankers that there was a perception that too many people were being refused finance and the cost of finance to small business was too high. Documents show Bank of Ireland chairman, Howard Kilroy, expressed deep concern in May 1994 over the tone and content of the taoiseach’s remarks on banks’ lending to small business. The banker expressed regret that the taoiseach’s comments coincided with Bank of Ireland’s annual results which he claimed meant they had gained a level of international exposure for 'anti-bank sentiment in Ireland'

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