The National Asset Management Agency pays for the loans it acquires from the five participating institutions by issuing Senior Debt securities to the value of 95% of the total consideration and Subordinated Debt securities for the remaining 5%. In the case of the latter, payment of interest and ultimate redemption is subject to NAMA’s financial performance. All securities are issued in Euro.
The main features of the Senior and Subordinated debt securities are described in more detail below.
NAMA Senior Debt
NAMA Senior debt instruments are unsecured floating rate Notes ranking pari passu with NAMA’s other unsecured and unsubordinated indebtedness. However, the principal and interest on the Notes is unconditionally and irrevocably guaranteed by the Minister for Finance.
In accordance with Section 50(4) of the NAMA Act 2009, the aggregate of the principal of all senior debt issued shall not exceed €51.3 billion. The interest rate (coupon) is six-month Euribor and is paid semi-annually on the 1st March and 1st September.
NAMA Subordinated Debt
NAMA has issued Callable Perpetual Subordinated Fixed Rate Bonds to the participating institutions. Some of the features include:
- On each Interest Payment Date commencing on 1 March 2011, NAMA may declare the interest payable if its Board deems it appropriate to do so in the context of NAMA meeting its objectives. Interest not declared in any year will not accumulate.
- The interest rate is the 10-year Irish Government Bond rate on the day of first issue plus a margin of 0.75% i.e. 5.264%
- NAMA has the right, but not the obligation, to redeem the subordinated bonds on 1 March 2020 or on 1 March annually thereafter.
- Bonds may be redeemed in full at par without undeclared interest but this is subject to the financial performance of the NAMA in its totality.
NAMA Debt Securities Outstanding as at 28th March 2013
Termsheet for the Subordinated Bonds issued by NAMA.
The Offering Circular for the Senior Notes issued by NAMA.
26 March 2012 - The Guarantee of the Minister for Finance.