NAMA publishes Fourth Quarter 2010 Report and Accounts

The National Asset Management Agency has today published its quarterly report and unaudited accounts for the fourth quarter of 2010.  The documents were laid before the Houses of the Oireachtas by the Minister for Finance earlier today.

The following are the main points of the Quarterly Report for the quarter ending December 31st 2010.

  • Up to the end of December last, NAMA had generated €740 million net cash from its operating activities – primarily generated from receipts from borrowers totalling €1.014 billion and derivative inflows of €47 million.  There was a significant cash outflow of €240 million to borrowers to allow them to complete projects and to fund working capital.  NAMA had total cash balances of €837 million at end-December 2010, an increase of €213 million from end September 2010.
  • At the report date (31st December 2010) NAMA had acquired €71.4 billion in loans from the five participating institutions.  As of the end of March 2011, this had increased to €72.3 billion, for which a total consideration of €30.5 billion had been paid. This represents an average discount of 58%.  Another €3.5 billion of loans may potentially be acquired over the coming months.
  • As of December 31st 2010, NAMA had reviewed business plans of the largest thirty debtors – these represent €27 billion of acquired loans or 37% of the total loan portfolio of €72.3 billion. 

The current position for these top 30 debtors (end April 2011) is that agreement in the form of Memorandum of Understanding (MoU]) has been completed with 16 debtors (and is close to completion with a further 2), the Agency has commenced enforcement procedures against 7 of the top 30 debtors, and the agency is continuing negotiations with 5 of these top 30 debtors. 

  • By the end of December last, NAMA had approved €2 billion of asset sales.  This figure had risen to over €3 billion by end of April.
  • Under IFRS accounting standards, NAMA is required to include an impairment charge on loans and receivables in its audited 2010 accounts.  As a result and at this time NAMA in its unaudited accounts has included an estimated impairment provision of €1 billion in the Q4 Section 55 Accounts resulting in an overall accounting loss for the year of €714 million.
  • The percentage of performing loans in the €71.4 billion portfolio at December 31st 2010 was 23%.

€4.6 billion of assets was yet to transfer at that date, €1.1 billion transferred in early March 2011, leaving a residual €3.5 billion to transfer.  If these transfers proceed, the Agency estimates that the percentage of performing loans will increase to 25%.

Commenting, NAMA Chairman Frank Daly said: “The opening months of 2011 have been exceptionally busy as NAMA moved from a period of intensive analysis of the position of the largest individual debtors to the next phase of the project where the focus is on identifying those we believe we can work with and moving others into the enforcement process.  We’ve seen the results of that move in recent weeks and I expect we’ll see further decisive action in the weeks ahead.  It should be stressed again that the only motive behind decisions taken on enforcement is to maximise the return to the taxpayer and where all other viable options have been exhausted. I would also emphasise that a majority of the debtors are working cooperatively and in a businesslike way with NAMA – again to the advantage of the taxpayer.”