Irish banks have become safe deposit boxes. Credit to the economy is drying up, despite increases in deposits.

Further information for interested readers: 1.) 2017 RSM/Construction Industry Federation Report on construction financing: "This report should sound alarm bells for those concerned with regional development, spatial strategy and in resolving the housing crisis. It shows that construction companies are experiencing difficulty in securing finance. This is especially acute in the regions and amongst SMEs. This report confirms that lending outside the urban centres is particularly challenged...traditional sources are unwilling to lend. This is not a call for a return to the speculative lending of the past. This report highlights many cases where companies are unable to secure finance to develop viable and essential residential projects particularly outside the greater Dublin area. It also highlights the paucity of funding available for construction companies to invest in plant, staff, technology, innovation and other core functions. At a macro-level, this threatens to undermine productivity in the industry and limit its growth over the coming decade." ""But the truth is we cannot get access to funding for land development. ” Medium sized construction company, Cork" "“As far as I can see neither the Banks nor the private equity firms have any interest in lending for any development outside of Dublin. It seems to be a policy across the board that property prices outside of the capital have not recovered sufficiently to justify from their perspective and until such time as they do, no further lending is likely to happen. ” Medium sized construction company, Galway" cif.ie/wp-content/uploads/2017...… 2.) July 2025 Journal article profiling Martin and other key figures corroborating the lending crisis as the root of the housing crisis: "TAOISEACH MICHEÁL MARTIN has said the banks are “still rooted in the last war” and said he has called on them to lend more to Irish builders to boost housing supply. Speaking to The Journal this week in Japan, where the Taoiseach visited Tokyo, Osaka and Hiroshima, the Taoiseach said the “psychology” of the Irish banks “needs to change”. Martin said he has spoken to the Banking Federation of Ireland about the matter, stating he told them banks should be lending more to Irish builders and developers. The Business Post reported earlier this year that there had been a fall-off in lending this year to developers by the two main pillar banks, AIB and Bank of Ireland. While Bank of Ireland’s loans to developers increased from €540 million to €608 million, the value of development loans issued by AIB for residential and commercial building fell from €992 million in 2023 to €809 million last year, the newspaper reported. The Central Bank has also stated the banks are well capitalised and can lend out more. It is believed that such a level of lending is deemed to be significantly lower than what is required to meet housing demand. “The cost of financing is a problem and it needs to lend more into the domestic construction industry, it’s not lending enough, and much of its lending is towards schemes that have a state backing already in terms of affordable housing,” said Martin. “Given the huge demand for housing in the market, to me, they’re still rooted in the last war and the psychology needs to change,” he added." thejournal.ie/banks-must-lend-...…