NAMA Chairman provides update on 2010 progress

The Chairman of the National Asset Management Agency (NAMA), Frank Daly, has provided an update on the progress of NAMA. Speaking to Primetime Investigates (due to be broadcast this Monday evening on RTE), Mr. Daly confirms:

  • The Agency has completed the acquisition of the original 11,000 loans from 850 debtors with a nominal value of some €71.2 billion1. Mr. Daly confirmed that Agency has paid over bonds to a value of €30.2 billion to the five institutions [AIB, BoI, Anglo, EBS and Irish Nationwide]. This equates to an aggregate haircut on the total amount of loans of some 58% – in line with previous guidance.
  • The Agency has now concluded its review of business plans from the top 30 developers which account for approximately €27 billion of the loans which have been acquired.
  • As a result of the Agency’s insistence, a number of borrowers whose loans have been acquired by NAMA have reversed or are in the process of reversing transfers of over €130 million worth of assets which they had previously sought to transfer beyond the reach of NAMA or the relevant Banks. These assets will now be used to support the execution of the agreed business plans.
  • Since March of this year, NAMA has approved the sale of an estimated €1.6 billion in property assets held by NAMA borrowers in order to pay down debts either to the Agency itself or to the relevant banks. Some of the funds realised are also being used to pay down debt owed by borrowers to non NAMA banks where they had co -lent on relevant developments.

Mr. Daly also confirmed that the Agency was currently finalising plans to acquire the further loans which it has been requested to acquire by the IMF/EU. It is estimated that this will include loans from AIB and Bank of Ireland with a nominal value of up to €16 billion.

In respect of the loans acquired to date, some 43% [by acquisition value] have already been subject to a thorough case-by-case valuation process and the valuations set have already been approved by the EU. The Agency has also completed individual due diligence and valuation on another 17% by acquisition value. This equates to 60% of the target portfolio being fully due diligenced by the end of 2010. The remainder of the loans which the Agency was requested to acquire in bulk form per the Minister for Finance’s Statement of 30 September have been acquired but will be subject to full due diligence and valued on a case-by-case basis during the coming months and any over/underpayment to the relevant institution will be calculated and adjusted at that time.

1 While the initial target for loans to be acquired was €73.4 billion, a number of loans are currently subject to legal challenge and the determination of the Expert Reviewer and as such may be transferred depending on the outcome.