EBA欧洲银行-EBA-response-to-Discussion-Paper-28EBA-DP-2015-02292029-September-2015_11页_499kb

EBA Banking Stakeholder Group Summary on SMEs and SME Supporting Factor Consultation

Core Content

The EBA Banking Stakeholder Group (BSG) has provided detailed comments on the Consultation Paper EBA/DP/2015/02, which seeks evidence on SME lending trends and the impact of the SME Supporting Factor. The BSG emphasizes the importance of SMEs in the European economy, highlighting that they represent 99% of all enterprises, employ two-thirds of the workforce, and contribute over half of the value added. Given their reliance on bank financing, monitoring capital flows to SMEs is critical for economic stability.

The BSG also points out that SMEs are not a homogeneous group and consist of micro, small, and medium enterprises, each with different characteristics and financing needs. This categorization is already used in other areas of data collection, but currently, there is no data available that reflects this distinction in SME lending.

Main Views

• Harmonization of SME definitions is essential for a level playing field in regulatory reporting.
• The SME Supporting Factor is not easily isolated as a key driver of lending trends due to the influence of other macroeconomic and financial factors.
• Creditworthiness assessment should consider both quantitative and qualitative factors, including management quality and market position.
• The impact of the SME Supporting Factor on lending volume and pricing is unclear, as it is difficult to separate its effect from broader economic conditions.

Key Information

4.1 Market Development and Sources of SME Financing

• No specific questions were raised in this section.
• The BSG notes that SMEs are not a single entity and that their financing needs vary significantly across subgroups.
• Alternative financing sources such as structured finance, capital market debt, and equity investments exist but are not easily accessible to all SMEs, especially micro and small ones.

4.2 Regulatory Treatment of SMEs and the SME Supporting Factor

• Yes, institutions have systems to track capital reductions due to the SME Supporting Factor, but registration is impeded by entities not reporting annual turnover.
• The BSG argues that the SME Supporting Factor alone cannot be proven to significantly impact SME lending due to the influence of other variables.
• Internal SME definitions may differ from the regulatory ones, leading to discrepancies in the application of the factor.

4.3 Riskiness of EU SMEs and Own Funds Requirements

• The proposed measures of SME riskiness are mostly aligned with existing credit risk models, but different institutions may use varying ratios.
• Qualitative factors such as management quality and reputation are also important in assessing SME risk.
• SMEs are not necessarily more or less cyclical than large enterprises, but their volatility is higher due to dependence on larger firms, domestic market concentration, and mono-sectorial activity.
• The BSG suggests that macroeconomic conditions may have a more significant impact on SME lending trends than the Supporting Factor.

4.4 SME Lending Trends and Conditions

• The BSG questions whether the SME Supporting Factor is the main driver of lending trends, as the data is complex and influenced by multiple factors.
• Interest rates for SMEs have decreased since 2014, with a notable drop in the interest rate spread compared to larger corporations.
• Collateral requirements have tightened, even though overall lending conditions have eased.
• SME credit lending procedures have not changed significantly due to the Supporting Factor, but there are indications of increased loan rejections in the EU, with some countries showing improvement.

4.5 Impact of the SME Supporting Factor

• The BSG believes that the SME Supporting Factor has had a positive impact, but evidence is limited due to the difficulty in isolating its effect.
• The factor may lead to increased lending volumes for some institutions, but it is not the only factor influencing lending behavior.
• Alternative financing sources such as crowdfunding and peer-to-peer lending are growing but are not yet a major influence on traditional bank lending to SMEs.

Conclusion

The BSG supports the EBA's initiative to harmonize supervisory practices for SME lending but highlights the need for more detailed and categorized data. They suggest that the SME Supporting Factor may have contributed to easing lending conditions, but its impact is not easily measurable. The group also advocates for a more consistent and comprehensive approach to defining SMEs and their risk profiles, as well as for further research into the relationship between alternative financing sources and traditional bank lending.