The Irish Bankers' Federation has rejected a claim by the Irish Creamery Milk Suppliers' Association that Irish farmers are being "ripped off" by the banks through excessive interest rates.
Mr Pat O'Rourke, ICMSA president, said Dutch farmers have access to credit at less than half the cost paid by Irish farmers.
European Central Bank figures, he said, had shown that business interest rates were at 3.3 per cent in Holland compared to 7.7 per cent in Ireland.
Mr O'Rourke said this was official confirmation of a "massive and unbelievable rip-off of farmers and business generally by Irish banks".
The association circulated a table of rates which showed Ireland at the top of the league for credit and wrote to the Central Bank to urge them to "take action on these unsustainable interest rates being charged by Irish banks".
Yesterday, the bankers' federation strongly rejected the ICMSA's contention that Irish bank lending rates to farmers were the highest in Europe.
It said while the Irish lending rates used in the European Central Bank database were the "AA" rates typically available to the smallest of small-to-medium enterprises (SMEs)/farmers, the rates quoted for many other countries appear to be the equivalent of "prime" rates that would not be available to the smallest of SMEs but principally to larger corporate customers. AA rates and prime rates are significantly different classes of lending rate and therefore are not comparable.
The statement said at present, our Central Bank appeared to be the only national central bank to publish separate bank lending rates for SMEs (AA rates) in addition to prime rates and this was the data which is fed into the existing European Central Bank database. The bankers' federation fully supported moves towards a more harmonised data system.