Bank of Scotland (Ireland) is to offer €1 billion in lending facilities to businesses and consumers in Ireland next year to improve their access to funds.
The bank, which is a subsidiary of HBOS, said it had already launched two separate funds of €100 million each as part of the €1 billion.
The two funds would provide support to the hotel industry and offer credit to first-time home buyers. "The unavailability of credit has become a real issue in recent months," said Mark Duffy, chief executive of Bank of Scotland (Ireland).
"Something needs to be done about this, so today we have pledged a €1 billion fund to get credit back into the economy," Mr Duffy said in a statement.
"It is our intention to launch a series of working capital initiatives in the form of loans, supports and venture capital to business customers and value for money schemes for personal customers over the coming months," he said.
The bank added it was in advanced discussions with the European Investment Bank (EIB) to source additional money for Irish businesses.
The EIB plans to make €30 billion in capital available to small and medium-sized businesses (SMEs) in the European Union, to help ease access to credit while lending conditions are tight.
Bank of Ireland yesterday launched a €250 million fund aimed at providing support to businesses.