NAMA Chairman/Chief Executive appear at Public Accounts Committee

NAMA will redeem a further €750 million of its Senior Debt next week, bringing the total amount redeemed to €7 billion, the Agency’s Chief Executive said today.   

Speaking to the Public Accounts Committee of the Oireachtas (Irish parliament), Brendan McDonagh said this means the Agency will have redeemed over 23% of its €30 billion Senior Debt and is on course to meet its target of redeeming a total of €7.5 billion, 25% of Senior Debt, by the end of the year.

“One of the principal measures of our progress is the repayment of our Senior Debt,” said Mr McDonagh. Given its continued ability to generate cashflow from the portfolio, Mr. McDonagh expressed confidence that NAMA would be in a position to redeem all of its Senior Debt by 2020 and thus eliminate the State’s contingent liability [1]. 

Mr McDonagh also said NAMA made a profit in the first half of 2013: “Over the coming days, we will be submitting to the Minister for Finance our results for the first half of 2013 and, while I cannot disclose the specifics now, I am happy to report NAMA made a profit in the first half of the year”.

The Agency has already reported full-year operating profits in each of 2011 and 2012.

Mr McDonagh also said:

  • NAMA has generated €13.7 billion in cash for the taxpayer since it began operating. €9.2 billion was generated from disposals and a further €4.5 billion came from rental and other non-disposal income.
  • NAMA continues to be self-funding and does not require cash from the Exchequer to meet its ongoing running costs.
  • NAMA debtors and receivers have sold over 2,000 individual properties in Ireland and are actively seeking buyers at present for Irish residential and commercial property worth €1.5 billion.  This will increase by up to €400 million in the coming weeks when two portfolios – mainly high quality offices and residential property – will be brought to market.
  • NAMA is working closely with the IDA to provide accommodation for major global businesses with plans to create jobs in Ireland. Significant recent transactions include providing space for Novartis, Scottish & Southern Energy and Kerry Group.
  • NAMA has provided funding of €10m to complete at least 600 housing units to be delivered for social housing purposes by the end of 2013

Staffing

Mr McDonagh also stated 28 staff members, more than 10% of all NAMA staff, have left the Agency so far this year. This is in addition to 22 staff members who departed in 2012. 

“NAMA is a commercial organisation which must operate on behalf of the taxpayer in the international arena. Against that background, it faces potentially serious consequences arising from the scale of staff turnover and the quality and experience of the departing staff,” he said.

“Our difficulty now is that we are losing many able and talented people and we are facing an uphill battle in retaining others. Replacing specialist staff is difficult; we cannot force property and banking specialists to join NAMA, nor can we force them to stay if better-paid opportunities arise elsewhere”.

Mr McDonagh said the Agency expects it will need to hire between 180 and 220 additional staff to work directly in NAMA, if the Agency acquires the bulk of the IBRC loan portfolio that is currently for sale by the Special Liquidators.  

[1]NAMA issued Government Guaranteed Bonds of €30.2 billion, which is a contingent liability of the State. That figure will be reduced to €22.5 billion by end 2013.