Financing SMEs and Entrepreneurs 2012 AN OECD SCOREBOARD OECD
Table of Contents Acronyms and abbreviations 13 Chapter 1. Financing SMEs and Entrepreneurs: Understanding and Developing an OECD Scoreboard 15 Introduction 16 Indicators 16 Data collection 17 Cross-country comparability 18 Definition of indicators and data collection: Current challenges and recommendations 18 Recommendations for data improvements 20 Chapter 2. Emerging Trends in SME and Entrepreneurship Finance 21 Introduction 22 Business environment and economic prospects 22 Lending to SMEs in 2007-10 24 Equity financing 28 Government responses 29 References 30 Chapter 3. Basel III and SME Lending: Thematic Focus 31 Introduction 32 Background on Basel III capital and liquidity standards 32 The basics of Basel II and III 32 Potential impact on SME lending 34 Notes,.. 41 References 41 Chapter 4. Country Profiles of SME Financing 2007-10 43 Canada 44 Chile 52 Denmark 60 Finland 66 France 74 Hungary 84 Italy 89 Korea 99 The Netherlands 105 New Zealand Ill Portugal 117 Slovak Republic 122
Slovenia 127 Sweden 132 Switzerland 139 Thailand 145 United Kingdom 151 United States 157 Annex A. Methodology 171 Annex B. Surveys and Statistical Resources on SME and Entrepreneurship Finance.7. 182 Annex C. Example of a Simplified Quantitative Demand-side Survey 187 Tables 1.1. Core indicators of the OECD Scoreboard on SME and entrepreneurship finance 17 2.1. Bankruptcies, 2007-10 23 2.2. Growth of SME business loans, 2008-10 '. 24 2.3. SME loan share of total business loans, 2007-10 25 2.4. Share of short-term SME loans, 2007-10 26 2.5. European Central Bank/European Commission survey on SME access to finance 27 2.6. Government policy responses to improve SME access to finance during the 2008-09 crisis 29 3.1. Minimum capital adequacy ratios 33 4.1. Distribution of establishments in Canada, 2010 44 4.2. Venture and growth capital in Canada, 2007-10 46 4.3. Financing SMEs and entrepreneurs: Scoreboard for Canada, 2007-10 49 4.4. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Canada's Scoreboard.' 51 4.5. Distribution of enterprises in Chile, 2010 52 4.6. Formal flows of venture and growth capital investment in Chile, 2007-09 53 4.7. Number of new direct government loans in Chile, 2007-10 54 4.8. Financing SMEs and entrepreneurs: Scoreboard for Chile, 2007-10 56 4.9. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Chile's Scoreboard 58 4.10. Distribution of enterprises in Denmark, 2007 60 4.11. Share of enterprises that applied for financing in Denmark according to growth record, 2007 and 2010 61 4.12. Result of loan applications by size of firm in Denmark, 2010 61 4.13. Financing SMEs and entrepreneurs: Scoreboard for Denmark, 2007-10 63 4.14. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Denmark's Scoreboard 65 4.15. Distribution of firms in Finland, 2010 66 4.16. Venture and growth capital investment in Finland, 2007-10 67 4.17. Incidence of solvency problems in Finland, June 2009-May 2011 67 4.18. SME loans and guarantees granted by Finnvera, 2007-10 68 4.19. SME export credit guarantees in Finland, 2007-10 69 4.20. Use of external finance by SMEs in Finland in the last six months, 2H 2010 69 3
4.21. Financing SMEs and entrepreneurs: Scoreboard for Finland, 2007-10 71 4.22. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Finland's Scoreboard 73 4.23. Distribution of enterprises in France, 2007 74 4.24. Private equity investment in France, 2005-10 77 4.25. Measures to finance SMEs in France 78 4.26. Financing SMEs and entrepreneurs: Scoreboard for France, 2007-10. 80 4.27. Financing SMEs and entrepreneurs: Definitions and sources of indicators for France's Scoreboard...:...-.-. 82 4.28. Distribution of enterprises in Hungary, 2007 84 4.29. Venture and growth capital financing in Hungary, 2007-10 85 4.30. Financing SMEs and entrepreneurs: Scoreboard for Hungary, 2007-10 86 4.31. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Hungary's Scoreboard 88 4.32. Distribution of firms in Italy, 2009 89 4.33. Early stage and expansion capital in Italy, 2006-10. 92 4.34. Financing SMEs and entrepreneurs: Scoreboard for Italy, 2007-10 95 4.35. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Italy's Scoreboard 97 4.36. Distribution of establishments in Korea, 2006.' 99 4.37. Venture and growth capital in Korea, 2007-10 100 4.38. Financing SMEs and entrepreneurs: Scoreboard for Korea, 2007-10 102 4.39. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Korea's Scoreboard 104 4.40. Distribution of enterprises in the Netherlands, 2010 : 105 4.41. Financing SMEs and entrepreneurs: Scoreboard for the Netherlands, 2007-10.. 108 4.42. Financing SMEs and entrepreneurs: Definitions and sources of indicators for the Netherlands' Scoreboard 110 4.43. Distribution of enterprises in New Zealand, 2010 Ill 4.44. SMEs requesting and obtaining finance in New Zealand, 2007-10 112 4.45. Financing SMEs and entrepreneurs: Scoreboard for New Zealand, 2007-10 114 4.46. Financing SMEs and entrepreneurs: Definitions and sources of indicators for New Zealand's Scoreboard 116 4.47. Distribution of enterprises in Portugal, 2008 '. 117 4.48. Equity capital invested by stage in Portugal, 2007-10 118 4.49. Financing SMEs and entrepreneurs: Scoreboard for Portugal, 2007-10 119 4.50. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Portugal's Scoreboard 121 4.51. Distribution of enterprises in the Slovak Republic, 2007 122 4.52. Breakdown of venture capital investments in SMEs in the Slovak Republic according to investment stages, 2007-10 123 4.53. Financing SMEs and entrepreneurs: Scoreboard for the Slovak Republic, 2007-10 124 4.54. Financing SMEs and entrepreneurs: Definitions and sources of indicators for the Slovak Republic's Scoreboard 126 4.55. Distribution of enterprises in Slovenia, 2009 127 4.56. Financing SMEs and entrepreneurs: Scoreboard for Slovenia, 2007-10 129
4.57. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Slovenia's Scoreboard 131 4.58. Distribution of firms and employment in Sweden, 2009 132 4.59. Financing SMEs and entrepreneurs: Scoreboard for Sweden, 2007-10 136 4.60. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Sweden's Scoreboard 138 4.61. Distribution of firms and employment in Switzerland, 2008 139 4.62. SMEs' access to finance in Switzerland, 2009-10 140 4.63. Private equity investments in Switzerland, 2009-10 140 4.64. Financing SMEs and entrepreneurs: Scoreboard for Switzerland, 2007-10 142 4.65. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Switzerland's Scoreboard 144 4.66. Distribution of enterprises in Thailand, 2010 145 4.67. Financing SMEs and entrepreneurs: Scoreboard for Thailand, 2007-10 148 4.68. Financing SMEs and entrepreneurs: Definitions and sources of indicators for Thailand's Scoreboard 150 4.69. Distribution of enterprises in the United Kingdom, 2007 151 4.70. Venture and growth capital investment in the United Kingdom, 2008-10 152 4.71. Financing SMEs and entrepreneurs: Scoreboard for the United Kingdom, 2007-10.' 154 4.72. Financing SMEs and entrepreneurs: Definitions and sources of indicators for the United Kingdom's Scoreboard 156 4.73. Distribution of firms in the United States, 2009 157 4.74. Value of small business loans outstanding for depository lenders, 2005-10 159 4.75. Value of small business loans outstanding, 2005-10 159 4.76. Number of small business loans outstanding, 2005-10 160 4.77. Number of small business loans outstanding from depository lenders, 2005-10... 160 4.78. Ratio of the value of small business loans outstanding to the value of total assets of depository lenders, 2005-10 161 4.79. Ratio of the value of small business loans outstanding to the value of total business loans outstanding for depository lenders, 2005-10 161 4.80. SBA 7a and 504 loan guarantees, 2000-10 164 4.81. Financing SMEs and entrepreneurs: Scoreboard for the United States, 2007-10 : ' 166 4.82. Financing SMEs and entrepreneurs: Definitions and sources of indicators for the United States' Scoreboard 168 A.l. Core indicators of the OECD SME and entrepreneurship finance Scoreboard... 172 A.2. Difference between national statistical and financial definitions of SMEs 176 A.3. Preferred definitions for core indicators 179 Figures 3.1. Sources of SME external finance, 2010 35 3.2. Bank adjustments implemented to meet Basel III: Capital position, 2011 38 3.3. Bank adjustments implemented to meet Basel III: Risk-weighted assets, 2011.. 38 4.1. Debt financing by source of funding, 2010 45 4.2. Business debt outstanding in Canada, 2000-10 45 4.3. Trends in SME and entrepreneurship finance in Canada 50
4.4. Value of direct government loans from INDAP, 2007-10 54 4.5. Trends in SME and entrepreneurship finance in Chile 57 4.6. Trends in SME and entrepreneurship finance in Denmark 64 4.7. Trends in SME and entrepreneurship finance in Finland 72 4.8. Growth rates of bank loans to all firms in France, 2007-11 74 4.9. Credit conditions for SMEs in France and the euro area (supply side survey), 2007-11 75 4.10. Credit demand for SMEs in France and the euro area (supply side survey), 2007-11 ;.. T.-.-: 76 4.11. Interest rates in France, 2007-11 76 4.12. Changes to supplier and client payment delays for SMEs in France, 1999-2009 77 4.13. Trends in SME and entrepreneurship finance in France 81 4.14. Trends in SME and entrepreneurship finance in Hungary 87 4.15. Lending to firms in Italy, 2005-11 90 4.16. Bank lending to various sectors in Italy, 2010 90 4.17. Payment delays in Italy, 2008-11 92 4.18. Trends in SME and entrepreneurship finance in Italy 96 4.19. Large enterprise and SME loans in Korea, 1995-2010, 100 4.20. Trends in SME and entrepreneurship finance in Korea \ 103 4.21. Trends in SME and entrepreneurship finance in the Netherlands 109 4.22. Trends in SME and entrepreneurship finance in New Zealand 115 4.23. Trends in SME and entrepreneurship finance in Portugal 120 4.24. Trends in SME and entrepreneurship finance in the Slovak Republic 125 4.25. Trends in SME and entrepreneurship finance in Slovenia 130 4.26. Trends in SME and entrepreneurship finance in Sweden 137 4.27. Trends in SME and entrepreneurship finance in Switzerland 143 4.28. Trends in SME and entrepreneurship finance in Thailand 149 4.29. Lending to SMEs and corporations in the United Kingdom, 2008-11 152 4.30. Trends in SME and entrepreneurship finance in the United Kingdom 155 4.31. Loan balances at depository institutions - commercial and industrial loans under USD 1 million, 1995-2011 158 4.32. Senior loan officer opinion survey on bank lending practices, 1990-2011 162 4.33. Demand for commercial and industrial loans, 1992-2011 '. 162 4.34. Per cent of small firms borrowing at least once during the quarter, 1986-2011.. 163 4.35. Gross loans guarantees, total 7(a) and 504 programs, 1990-2011 164 4.36. Trends in SME and entrepreneurship finance in the United States 167