Bank of Ireland lent €4.5 billion to small and medium-sized businesses last year and approved almost nine out of 10 credit applications from the sector, figures released by the financial institution show.

The bank received almost 61,000 loan applications from small businesses in 2014 and it says in a statement that it approved 88 per cent of them. In total, it agreed to lend a total of €4.5 billion, a 13 per cent annual increase.

It approved €1.3 billion worth of credit during the last quarter of the year alone.

Based on analysis of Central Bank data, the bank says that it continues to be the main provider of credit to smaller firms, accounting for more than 50 per cent of new non-property lending.

The €4.5 billion figure covers new and increased lending and does not include restructured debts.

According to Mark Cunningham, its director of business banking, the lender continued to see signs of improved optimism and increased demand for credit from farmers, retailers and the motor trade.

“We continued to see increased demand for credit in the latter quarter of the year,” said Cunningham. “Agriculture continued to be a very important growth sector for the bank, with overall approvals to the sector exceeding €620 million, a 19 per cent increase over the previous year.”

Mr Cunningham said that the motor industry is expected to continue growing this year, with new car sales likely to reach 115,000.