IRELAND A major Ireland bank that provides cash-flow lending to about 20% of the country’s hotels has closed, leaving as many as 150 hotels at risk of defaulting.
The Irish Hotel Federation is asking the government to guarantee short-term loan availability to the hotel industry following the closure this week of Bank of Scotland Ireland. The hotel group worries its members may be unable to find needed credit elsewhere and could encounter substantial cash-flow problems in the winter months.
“Unilateral withdrawal of these working capital facilities at the end of December would be catastrophic, particularly at a time when other banks are reluctant to take on new customers and when asset securities would continue to be held by Bank of Scotland Ireland,” Irish Hotel Federation President Paul Gallagher says, according to a BBC report.
The process to wind down the bank’s Ireland loan book could take between two and 10 years.