DISCLOSURE REQUIREMENTS ON BOARD MEMBERS

Sections 30-31 of the Act outline the requirements on members of the Board in terms of disclosure of interests.

Section 30 requires Board members to disclose to other members of the Board the nature of any pecuniary interest or other beneficial interest they may have in any matter that is under consideration by the Board. Members must absent themselves from a Board meeting while the matter is under consideration and they are precluded from any vote that may take place on the matter.

Section 31 of the Act imposes an obligation on each member of the Board and each director of a NAMA group entity to give notice to NAMA annually of all registrable interests within the meaning given by the Ethics in Public Office Act 1995.

STAFF ASSIGNED TO NAMA

Staff assigned to NAMA are subject to a Code of Practice and Professional Conduct which imposes obligations on them in respect of the following:

• Legal and ethical obligations of confidentiality, including Section 202 of the Act and the Official Secrets Act 1963.
• They are also required to comply with the provisions of the Data Protection Acts 1988 and 2003, including provisions regarding the processing and handling of personal data.They are subject to specific legislative provisions in relation to conflicts of interest. Each employee, prior to assignment to NAMA and on an annual basis thereafter, must provide the CEO of NAMA and the Chief Executive of the NTMA, with a statement of his or her interests, assets and liabilities.
• NAMA staff are not permitted to accept any hospitality from any person, firm or other legal entity with which NAMA has dealings.
• NTMA has also established rules and codes of practice in relation to market abuse including insider dealing. NAMA Board members and staff are subject to these as they are to NTMA rules and codes which apply to personal account transactions.
• It is an offence to lobby a Board or staff member of NAMA or of a NAMA service provider in connection with any decision relating to lending, the initiation of legal proceedings, the engagement of a service provider or adviser, the purchase or sale of property or any tender. A person who is subject to such communication is under an obligation to notify the Gardai and failure to notify is an offence.
• All NAMA officers are subject to a Code of Practice approved by the Minister for Finance under Section 35 of the Act.
• Refresher compliance training is mandatory for all NAMA officers.

PERSONAL ACCOUNT TRANSACTION POLICY

During the year, NAMA identified a compliance breach in respect of a transaction involving one of its former officers. Upon identification of this matter, NAMA requested its Internal Auditors to undertake an independent investigation into the matter and NAMA published the findings of the Internal Auditor's investigation which included a number of recommendations that have been implemented by NAMA. Separately, NAMA became aware of a data confidentiality breach and took civil law proceedings to ascertain the extent of the breach and mitigate its effects. NAMA reported the matter to An Garda Síochána.

Following an investigation into the transaction, the Board introduced a revised Personal Account Transaction Policy for all NAMA officers. The revised policy prohibits the purchase by a NAMA officer of any property in which NAMA has an interest. The sole exception to this policy arises in the case of a residential property which is to be used as a principal private residence; such purchase must be pre-approved and open marketing of the property must be clearly demonstrated. In addition, Board policy requires that the purchase of any property from a debtor or receiver must demonstrate that neither the purchaser nor any person with a beneficial interest in the transaction is a NAMA Officer.

NAMA ACCOUNTABILITY

The Board of NAMA must carry out its functions independently but is closely guided by its obligations under the Act and is subject to a high level of public accountability.

1. Under the Act, the Minister has a number of powers which he can exercise in relation to NAMA, including the power to issue guidelines (Section 13) and directions (Section 14). Five directions have been issued by the Minister under Section 14 and another four directions have been issued under the IBRC Act. Copies are available on www.nama.ie/legislation.
2. NAMA submits quarterly reports to the Minister on its activities, as set out in Section 55 of the Act. This includes information about its loans, its financing arrangements and its income and expenditure. Each quarterly report is laid before both Houses of the Oireachtas.
3. NAMA submits annual accounts, in a form directed by the Minister, under Section 54 of the Act. The accounts must include a list of all debt securities issued, a list of all advances made from the Central Fund or by NAMA and its group entities and a list of asset portfolios with book value. NAMA's accounts are audited by the C&AG and the audited accounts are laid before both Houses of the Oireachtas.
4. In addition to its annual accounts, NAMA is also required to submit to the Minister, under Section 53, an Annual Statement setting out its proposed objectives for each year, the scope of activities to be undertaken, its strategies and policies and its proposed use of resources. Each annual statement is laid before both Houses of the Oireachtas.
5. The Chief Executive Officer and the Chairman, whenever required by the Committee of Public Accounts, attend and give evidence. The CEO and the Chairman also appear before other committees of the Oireachtas whenever required to do so.
6. The Minister may require NAMA to report to him at any time on any matter including performance of its functions or information or statistics relating to performance.
7. NAMA has prepared codes of practice to govern certain matters including, amongst others, the conduct of its officers, servicing standards for acquired bank assets, risk management, disposal of bank assets and the manner in which NAMA is to take account of the commercial interests of non-participating banks. The codes of practice have been approved by the Minister and are published on www.nama.ie/CodesOfPractice.
8. As soon as may be after 31 December 2012, the Minister and the C&AG will separately assess the extent to which NAMA has made progress toward achieving its overall objectives and the Minister will decide whether the continuation of NAMA is necessary. Thereafter, the Minister will review progress every five years and the C&AG every three years.