Sorry for interrupting, this website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Learn more
Accept and close



Small to medium-sized enterprises play a key role in the economies of both NI and RoI; representing over 99% of businesses in NI and 97% in ROI.

Following a period in which both economies enjoyed significant growth, the RoI economy entered its first recession in more than two decades in 2008. The global credit crunch that began in 2007, following the American sub-prime mortgage fiasco, has resulted in banks significantly tightening lending and bringing an end to the era of abundant credit. This has created severe difficulties for SMEs, many of whom are reliant on credit from their financial services provider for the day-to-day running of business.

Key themes of the report:

  • The Irish banking system is facing a crisis of liquidity and confidence which has created an extremely difficult lending environment.

  • While access to credit has tightened significantly, the recession creates an increased necessity for finance than existed previously as businesses struggle with the effects of decreased demand, particularly for SMEs which are unlikely to have the same financial leverage of larger businesses.

  • To what extent will the recapitalisation of Irish banks and the UK Enterprise Finance Guarantee Scheme help SMEs to access finance?

  • While there have been some measures taken to increase competition in business banking, charges in NI remain disproportionately high.

  • Company liquidations in RoI increased by 104% during 2008. This will make accessing finance particularly difficult in sectors which have seen high levels of insolvency such as the construction and hospitality sectors.

What's included

What's included

Table of contents

Table of contents

  1. Issues in the Market

      • Key themes of the report:
        • Definition
          • Abbreviations
          • Insights and Opportunities

            • Credit where credit’s due
              • Banks to provide a tailored approach to small business clients
                • Special business account rate for self-employed/sole trader
                  • High charges by NI ‘big four’ present opportunities for UK banks
                  • Market in Brief

                    • Importance of SMEs to business banking market
                      • Value of SME banking market reached €97 billion in 2008
                        • Difficult lending environment created by credit crunch
                          • SMEs benefit from Irish bank recapitalisation…
                            • …while the UK EFG scheme boosts SME credit
                              • IBF switching code helps to stimulate competition in RoI
                                • Competition Commission investigation into SME banking
                                  • Locality and personal relationships are essential to SMEs
                                    • Central Banks’ interest rates at an all time low: But credit remains expensive
                                      • Recession increases demand for working capital finance
                                        • Banking sector dogged with confidence issues
                                          • Corporate insolvency rate rises sharply
                                          • Market Background

                                            • Key points
                                              • Development of the Irish banking market
                                                • Business services provided by banks
                                                  • Banking sector is characterised by many regulatory bodies
                                                    • SMEs and their importance to the banking sector
                                                      • Majority of NI businesses are not small but micro
                                                        • 80% of RoI workforce employed by small businesses
                                                          • SMEs are well represented
                                                          • Internal Market Environment

                                                            • Key points
                                                              • The credit crunch creates a difficult lending environment
                                                                • The impact of the credit crunch on SMEs
                                                                  • Figure 1: Types of finance used by SMEs (% of SMEs)
                                                                • From riches to rags: the demise of Irish banks
                                                                  • Deposit protection scheme announced
                                                                    • Bank recapitalisation plan announced
                                                                      • Figure 2: Recapitalisation plan: capital boosts, voting rights and annual dividend, AIB and BoI, 2008
                                                                    • Anglo-Irish Bank nationalised
                                                                      • Right move, wrong bank?
                                                                        • UK Enterprise Finance Guarantee Scheme launched
                                                                          • Banks between a rock and a hard place
                                                                            • The IBF Switching Code introduced to RoI
                                                                              • Findings of the investigation
                                                                                • Terms of the Business Switching Code
                                                                                  • UK Competition Commission’s review into SME banking
                                                                                    • Competition Commission’s response
                                                                                      • The behavioural undertakings
                                                                                        • The transactional undertakings
                                                                                          • Could the NI market benefit from similar supervision?
                                                                                            • Personal relationships are paramount
                                                                                              • High rate of self-employment in IoI
                                                                                                • Figure 3: Self-employment rates (as % of working population) for UK regions & RoI, 2008
                                                                                              • Official cost of borrowing is at an all-time low…
                                                                                                • Figure 4: BoE and ECB interest rates, Jan 2008-Apr 2009
                                                                                              • …but the real cost of borrowing in Ireland remains high
                                                                                                • Interest rates cut not enough
                                                                                                • Broader Market Environment

                                                                                                  • Key points
                                                                                                    • Fallout from recession dominates RoI outlook
                                                                                                      • Figure 5: Economic outlook, RoI, 2008-10
                                                                                                    • Unemployment levels soar
                                                                                                      • Recession bites NI in 2009
                                                                                                        • Figure 6: Economic outlook and forecast, NI, 2008-10
                                                                                                      • Sharp increase in unemployment could prove forecasts overly optimistic
                                                                                                        • SME sector is driven by a strong economy
                                                                                                          • Figure 7: Number of enterprises by size and GDP growth, NI, 2004-07
                                                                                                          • Figure 8: Number of people employed (000) by enterprise size and GDP growth, RoI, 2004-07
                                                                                                        • Business confidence hits a low point
                                                                                                          • Property market bubble bursts…
                                                                                                            • Figure 9: Quarterly average house price, RoI, 2005-08
                                                                                                            • Figure 10: Quarterly average house price, NI, 2005-08
                                                                                                          • …and creates a downward spiral for banks
                                                                                                            • More intense regulation is required in banking
                                                                                                              • Scandal compounds confidence issues
                                                                                                                • RoI corporate insolvencies increase by 104%
                                                                                                                  • Figure 11: Summary of creditors’ voluntary liquidations, high court liquidations, receiverships and examinerships, RoI, 2004-08
                                                                                                                • NI insolvencies increase by 37.5%
                                                                                                                  • Figure 12: Company insolvencies (Compulsory liquidations and creditors voluntary liquidations) NI, 2004-08
                                                                                                                • Sharp drop in sterling rate hits RoI SMEs hard
                                                                                                                  • Figure 13: Value of Sterling against the Euro, January 2007-March 2009
                                                                                                                  • Figure 14: Exports to GB and NI, (€m), 2007-08
                                                                                                              • Market Value and Forecast

                                                                                                                • Key points
                                                                                                                  • Figure 15: Estimated market value of private sector SMEs, IoI, 2003-13
                                                                                                                  • Figure 16: Indexed trends of IoI SME banking market 2003-13
                                                                                                              • Market Segmentation

                                                                                                                • Key points
                                                                                                                  • Loans to SMEs worth two-thirds of the total SME banking market
                                                                                                                    • Figure 17: Estimated ratio of SME deposits and loans, 000s, IoI, 2008
                                                                                                                  • Loans to SMEs set to contract by 3% in 2009
                                                                                                                    • Figure 18: IoI market value of private sector SME loans, 2003-13
                                                                                                                  • SME deposits
                                                                                                                    • Figure 19: IoI market value of private sector SME deposits, 2003-13
                                                                                                                • Strengths and Weaknesses

                                                                                                                  • Strengths
                                                                                                                    • Weaknesses
                                                                                                                    • Suppliers

                                                                                                                      • Key points
                                                                                                                        • Abbey National plc
                                                                                                                            • Figure 20: Abbey business bank account and charges
                                                                                                                          • Alliance & Leicester
                                                                                                                              • Figure 21: Alliance & Leicester small business bank account and charges
                                                                                                                            • Allied Irish Bank (AIB)/First Trust
                                                                                                                                • Figure 22: Loan portfolio by sector (% of group portfolio)
                                                                                                                                • Figure 23: AIB/First Trust Small business bank account and charges
                                                                                                                              • Bank of Ireland Group
                                                                                                                                  • Figure 24: Bank of Ireland’s loan portfolio, by sector
                                                                                                                                  • Figure 25: Bank of Ireland business bank account and charges
                                                                                                                                • Barclays Bank plc
                                                                                                                                    • Figure 26: Barclays small business bank account and charges
                                                                                                                                  • Halifax (Bank of Scotland Ireland)
                                                                                                                                      • Figure 27: HBOS business bank account and charges
                                                                                                                                    • HSBC Bank plc
                                                                                                                                        • Figure 28: HSBC small business bank account and charges
                                                                                                                                      • National Irish Bank (NIB) and Northern Bank
                                                                                                                                          • Figure 29: Range of business accounts offered by Northern Bank/NIB
                                                                                                                                          • Figure 30: Northern Bank/NIB business bank account and charges
                                                                                                                                        • Permanent TSB
                                                                                                                                            • Figure 31: Permanent TSB business bank account and charges
                                                                                                                                          • Ulster Bank Group
                                                                                                                                              • Figure 32: Ulster Bank business bank account and charges
                                                                                                                                          • Buyers

                                                                                                                                            • Key points
                                                                                                                                              • Small firms in context – RoI
                                                                                                                                                • RoI businesses by size band
                                                                                                                                                  • Figure 33: Breakdown of manufacturing and services businesses in RoI, by employee sizeband, 2006
                                                                                                                                                • RoI businesses by industry classification
                                                                                                                                                  • Figure 34: Number of enterprises, by employment sizeband and industrial classification, RoI, 2006
                                                                                                                                                • Manufacturing
                                                                                                                                                  • Figure 35: Turnover (€m) of manufacturing enterprises, by size band, RoI, 2001-05
                                                                                                                                                • Manufacturing export sales
                                                                                                                                                  • Figure 36: Manufacturing export sales and destinations, by enterprise size, RoI, 2005
                                                                                                                                                • Services
                                                                                                                                                  • Figure 37: Total turnover (€m) of services enterprises by enterprise size, RoI, 2000-05
                                                                                                                                                • SMEs in context – NI
                                                                                                                                                  • NI businesses by size band
                                                                                                                                                    • Figure 38: NI businesses, by sizeband, 2007
                                                                                                                                                  • NI businesses by industry classification
                                                                                                                                                    • Figure 39: Number of enterprises, by employment sizeband and industrial classification, NI, 2007
                                                                                                                                                  • Change over time
                                                                                                                                                    • Figure 40: Distribution of businesses, by employee size band, NI, 1998 and 2007
                                                                                                                                                  • Manufacturing turnover
                                                                                                                                                    • Figure 41: Manufacturing sales (£m), by enterprise size, NI, 2004/05-2007/08
                                                                                                                                                  • Manufacturing sales destinations
                                                                                                                                                    • Figure 42: Destination of manufacturing export sales (£m), by enterprise size, NI, 2007/08*
                                                                                                                                                  • Survival rate of new businesses
                                                                                                                                                  • Appendix

                                                                                                                                                      • Figure 43: Exchange rates used
                                                                                                                                                      • Figure 44: Summary of creditors’ voluntary liquidations, high court liquidations, receiverships and examinerships, by industry, RoI, 2004-08

                                                                                                                                                  About the report

                                                                                                                                                  This report will give you a complete 360-degree view of your market. Not only is it rooted in robust proprietary and high-quality third-party data, but our industry experts put that data into context and you’ll quickly understand:

                                                                                                                                                  • The Consumer

                                                                                                                                                    What They Want. Why They Want It.

                                                                                                                                                  • The Competitors

                                                                                                                                                    Who’s Winning. How To Stay Ahead.

                                                                                                                                                  • The Market

                                                                                                                                                    Size, Segments, Shares And Forecasts: How It All Adds Up.

                                                                                                                                                  • The Innovations

                                                                                                                                                    New Ideas. New Products. New Potential.

                                                                                                                                                  • The Opportunities

                                                                                                                                                    Where The White Space Is. How To Make It Yours.

                                                                                                                                                  • The Trends

                                                                                                                                                    What’s Shaping Demand – Today And Tomorrow.

                                                                                                                                                  Please Note: This is a sample report. All of the figures, graphs, and tables have been redacted.

                                                                                                                                                  Trusted by companies. Big and small.

                                                                                                                                                  • bell
                                                                                                                                                  • boots
                                                                                                                                                  • google
                                                                                                                                                  • samsung
                                                                                                                                                  • allianz
                                                                                                                                                  • kelloggs
                                                                                                                                                  • walgreens
                                                                                                                                                  • redbull
                                                                                                                                                  • unilever
                                                                                                                                                  • Harvard
                                                                                                                                                  • pinterest
                                                                                                                                                  • new-york-time