A government advisor has warned that Irish businesses may struggle to get bank loans in the coming year -  even as the economy recovers.

However Dr Alan Ahern – who’s a special advisor at the Department of  Finance – has expressed confidence that the problems in the banking system will be rectified by the end of 2010.

He told Auctioneers at the IAVI conference in Dublin that the asset management agency NAMA will not hoard property, and will release lands onto the market from early on.

But he warned of further difficulties for businesses who need bank loans to survive.

“The problem of the lack of credit can become more acute as the recovery begins to take hold  this year and next year” he said.

“That’s when the demand for loans will come back, and we want the banks to be able to provide those loans – we don’t need the banks to provide tens of billions of new loans”.

“We want to be able to say, at the margin, to new businesses” he added.