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THE NATIONAL ASSET Management Agency (Nama) has rejected a report which says that it could have sold loans based in Northern Ireland for more than £1.32 billion.
The long-awaited Comptroller and Auditor General’s (C&AG) report into the sale of Project Eagle was published today, saying that the agency could have made more than that.
The report, however, makes no claim of irregularities. It does say that the State lost around £190 million (€220 million).
The C&AG report finds that Nama had over-discounted the loans, giving 10-15% discounts where 5.5% would be more applicable. It adds that NAMA did not keep an “adequate record of key decisions and events even though the sales process deviated from standard”.
It adds that Nama board minutes do not “record clearly the basis for decision about a minimum price for the portfolio.
NAMA incurred a net loss in 2014 of £162 million from Northern Ireland debtor asset sales, most of which related to Project Eagle. This was in addition to losses of £478 million on the loans which had already been recognised in impairment charges.
Nama, however says that is incorrect. It says that many of the loans were impaired and not selling them in 2014 would lead to the state holding the loans until 2020.
In a scathing statement today, Nama says that the entire report is flawed, categorically rejecting the findings.
The report’s key finding is based on an incorrect assumption regarding the discount rate used to value the portfolio. It incorrectly assumes NAMA should apply the same discount rate to this poor quality loan portfolio as it applied to much higher quality assets in Dublin and London. As a result the report overstates the estimated value of this portfolio.
“NAMA’s view of the discount rate is supported by four specialist international firms (KPMG, Eastdil Secured, Cushman & Wakefield and Lazard). The C&AG’s position is unsupported by the market.
The report’s conclusion that a better price could have been achieved is hypothetical and highly speculative. It produces no credible evidence to show any other buyer or group of buyers would have paid more than was achieved.
The C&AG report says it “draws no conclusion about the merits of the decision” to sell the loans as a package.
Frank Daly, Nama’s chairman, said that the agency had done its utmost to achieve the best price possible.
“It is very clear to us that had Nama retained that Eagle portfolio, there would be no investor interest in buying it today or in the foreseeable future at anything close to the £1.3 billion we achieved in 2014.”
Christina Finn / TwitterFF Michael McGrath says Nama sale process of Project Eagle wasn't as open as it should have been pic.twitter.com/HAygNG9ROA
— Christina Finn (@christinafinn8) September 14, 2016
Fianna Fáil’s Finance spokesperson Michael McGrath said that the report “contains very strong criticism of Nama’s handling of the sale”.
The C&AG makes strong and very striking criticism [relating] to the process of Nama’s sale of Project Eagle.
“(It reaches) the conclusion that the process wasn’t as open as it should be in terms of opening up the competition to all potential bidders. The fact is that the amount of time available for potential bidders to carry out the necessary due diligence may well have had an impact for taxpayers. It is a very significant and important conclusion that has been reached.
“Instead, Nama proceeded with the sale to an alternative bidder, Cerberus, whose final bid came in just €11 million above the minimum price threshold that Nama had set at board level.
“The criticisms are very serious, very significant, they certainly warrant an investigation here in the Republic.
“One cannot but reach the conclusion that in March 2014 – when Nama and indeed the Minister was informed of the inappropriate, unorthodox fee arrangement that was in place between Pimco, Brown Rudnick, Tughans and Mr Cushnahan – that the whole process should have been stopped at that stage.”
Adviser
McGrath also says that the “shadow of (former Nama adviser) Frank Cushnahan looms large in the report”.
Last week it was revealed that Cushnahan had been secretly recorded accepting a £40,000 (about €48,000) cash payment from a Nama borrower.
The report says that allegations of a conflict of interest against Cushnahan and his involvement in an arrangement to share “success fees” with parties interested in buying the loans “warranted more action by Nama”.
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It’s all done and dusted now, there’s no commercially sensitive reason for Nama to be exempt from FOI requests anymore.
Open it up and we’ll take a look ourselves.
FF criticism of this is unbelievable.
NAMA was set up by FF. The “veil of secrecy” was their idea. The complete lack of oversight or accountability was FF’s fault and FF’s fault entirely.
The brass neck of them – criticizing an agency for the very flaws they themselves instigated.
Mind you, FG should have ripped the veil of secrecy away too as soon as they came to power. Poor decisions by both parties.
That’s because they’re two cheeks of the same arse Brinster.. I know, I know, such a cliché
Sorry brinster, but FG have been in the position for the last 6 years to legislate for transparency from NAMA. They have done nothing except turn a blind eye.
But fair play to ya for repeatedly pushing the spoof that there’s any difference between the two parties. God loves a trier and all that….
NAMA wouldn’t react any other way…the louder they bellow the more corrupt they appear. I for one hope that this is the corner of the rug being lifted to expose the corruption that lies beneath.
Looks like Noonan got an skin allergy aptly called ‘Cellulitus’ from the cheap selling of our assets. http://www.independent.ie/irish-news/news/minister-noonan-missed-cabinet-meeting-following-cellulitis-diagnosis-35049334.html
There will be an investigation and it will be put down to human error without blaming anyone…The news will be full of the arrests in Spain and Dublin and Frances will have paid her dues…move on nothing more to see…
Trust NAMA. Why would it favour the elite?
PURE BULL. WHAT A LOAD SH#T,
THE FF/FG/LAB. KNOW WHAT IS GOING ON WITH NAMA FOR YEARS
THEY SOLD US OUT. FFS
But sure tweedledum will blame tweedledee will blame each other and swap the reigns of power over and over. Time to end this charade.
They are all wrong?
C&AG, Moriarty, EU inquiry on Apple tax, Halligan, Consultants, Brizillian investigation into OCI ticket sca/money laundering, Cushnahan/NAMA/Spotlight, IW, Vulture funds and their ZERO tax, Starbucks, etc, etc. And they keep living the lie and cover it up with more lies. Nothing to see here because they are our sponsors, and Michael Martin knows all about sponsors bank deposits. Yeah vote for the status quo and keep the spondulas rolling in. You know it makes sense.
“NAMA did not keep an “adequate record of key decisions and events even though the sales process deviated from standard”.
It adds that Nama board minutes do not record clearly the basis for decision about a minimum price for the portfolio.”
I wonder why they didn’t think it was important to take proper notes at meetings about a £1.4bn deal.
An absolute and utter joke. A massive stroke either has been, or is being, pulled here.
NAMA learned from FG’s Big Phil…..never to take notes on anything that involves the public interest…..just in case someone finds out it wasn’t in the public interest.
The Director’s of NAMA should be disbarred from being company directors by the Director of Corporate Enforcement. They didn’t keep minutes of board minutes, wtf ?
Tune in next week for another episode of ” The Land Of Zero Accountability”
Next week? Jaysus that’d be something.. You know there’ll be something new within 48 hours.
NAMA has done its job selling off the family silver, so now it is time to wind it up and move on.
“NAMA did not keep an “adequate record of key decisions and events even though the sales process deviated from standard”.
Exact same excuse the Govt. and the Banks gave…same old same old
NAMA is more powerful than the state it would appear.
Someone needs to give these guys a good public slapdown and remind them of who they are and why they were appointed in the first place.
They’ve become a law unto themselves at this point.
They were appointed to do exactly what they did, it isn’t coincidence.
Pull the wool over the public’s eyes?
Dead right Joey, but that should have happened 3 years ago and a member of the private sector should have been appointed as watchdog. It seems quite clear to me that the Cush told Cerberus the minimum figure. Should have been stopped and an immediate investigation into the previous deals squandered. As McWilliams said, “Nama took what they were offered ” (regardless of the value).
David McWilliams would have been an excellent advisor.
The key question really is why was there such haste in offloading the property? Might have made the government look good to sort out the problem quickly but poor economic sense in hindsight.
Of course he did Gareth, no coincidence the bid was one million over the minimum figure. Sick of this cvnt of a country and the rife blatant corruption on a massive scale that is sanctioned by successive government!
It’s hard to imagine an entitly LESS biased or sullied in this than the C&AGs office. For NAMA to blow off the findings like this should set major alarm bells off.
Wonder whats next?
NAMA stonewalls and refuses to answer any questions at next weeks committe, followed by an investigetion, the scope of which is dictated by FG, whic h will release its findings a week after noonan is planning on retiring.
Across the water in Britain if their is even a hint of wrong doing people step down immediately and help the investigation, here it is a case of brassing it out and hire more spin doctor’s, pass the buck and drag out the inquries for years.
Million squandered and the best Noonan can offer is a 10 cent rise in the price of a packet of fags in an effort to try an recoup the money squandered and still been squandered.
Close down NAMA immediately until the 3 police forces investigating it has done their jobs.
National Arrogance and Manipulation Agency
Of course. Tax payer can do without that €190 Million. Sure we dont even want the 13 Billion handed to us … No problems from the Irish tax payer… Carry on…
Willy the 13 billion would be taken by our eu friends coz the tax was paid by consumers in that country. If we push out or fdi will back to being raped by priests. I want modern industry in this country our European friends want it on there’s.
Noonan knew about the fees issue and who exactly was involved in the process. If Noonan knew, Kenny knew, they were half of the EMC at the time.
The report statest that Noonan should have stopped the process when he knew.Why didn’t he?
It looks like the price was acceptable as it left more money to be sloshed around in “fees”.
Mick Wallace was and is right about NAMA. Noonan knew he was right, Kenny knew as well.
Corruption abounds.
Mick Wallace my b****. Owes vat robbed his employees and still operates profitable food outlets. Stones and glasshouses
Whatever Mick’s sins are, he’s a more honest and straighter that any that sit on FG or FF benches.
FG/FF have robbed billions from the state and left ordinary people paying the bill.
Well they would say that, wouldn’t they.
Was hoping someone would say that.
NAMA can do no wrong ask knuckle head noonan
Guards and civil servants etc must retire at 65 yr of age yet we have Noonan fiancée minister in mid 70 in charge of the purse of this banana republic make you sick !
Not true.
There is no retirement age for civil servants who joined after 1995.
The deeper you dig the more rotten it gets, it’s all about grabbing from the people in financial trouble & giving sweetheart deals to the filthy rich!
Noonan position and judgement in this latest debacle judging by his comments on mon/tue is in serious doubt ?
His director of elections from 2011 is on the NAMA board FFS. We laugh at the people of Tipperary and Kerry for who they elect but Limerick is a f*cking joke. The two poll toppers every election are that crooked slime ball and that other rat Willie O’Dea!
We don’t need AN INQUIRY .Send the Gardaí in with proper resources . If somebody steals millions that is normal procedure.
Naaaaaaama as knuckle head noonan calls it is mana from heaven for corupt ireland
Ireland is supposed to be a Republic yet here we have a secret organisation run by unelected and unaccountable people answerable to neither the Guards nor the courts, some of who were involved in the financial crash and they are getting away scot free with more corruption and double dealing resulting in the country being fleeced again, all the while being protected by the state its officials and the Irish media and they are getting a wage and pension to do it.
The dog in the street knows of at least one dodgy Nama deal in their area but it will be all swept under the carpet and big pensions handed out to the Nama staff.
Sure what else would they say defending their own actions ruthlesss . they were selling off properties because Kenny wanted them
To finish up despite having lots to do they rushed through selling portfolios off without proper pricing considerations
http://www.independent.ie/…/noonans-image-tarnished-by-the-hepatitis-c-scandal-2609540…;
http://www.independent.ie/…/vulnerable-grace-left-in-home-at-the-centre-of-sexual-abuse-c..
How is this characator Noonan in Government after the way he treated Mrs Brigid McCole in the blood bank scandel When he was informed about the sex abuse of Grace in the foster home he did not contact the Gardai, leaving the little girl to suffer further sex abuse.. That man is a disgrace and not fit for office
Did anyone else get the feeling when nama was set up that the prople were going to get screwed….. again.
There should be riot but yet again we sit and take it up the rear end.
I’m nearly ashamed to be Irish .
All sales must be stopped immediately,and all past sales investigated.a vote of no confidence must be called on noonan,he covered all of this up.
Well they would say that…..
Just another PR con job to keep the gombeen idiot Irish sheeple in suspense. Same bunch of people that stated we wont need a bank bailout that sold out Irish fishing and rural small communities.
If they lost 220 million on this…….what did they lose to heir buddies in the other vulrure funds…….just send in the guards and xonfiscare all th e records……..wtf do oir poloce force not go straight in when corruption is suspected….wating for ff FG ro hide the evidence
Sure what’s 220 Million,, sure they still get their fat checks every month! Then they’ll tell us, they got the best deal for the Tax Payer! They expect us just to swallow our medicine & like it!
Nama should have a professional property register with updated profile and pricing and at least 2 listing real estate
agents so that local and international buyers can express interest and/or make an offer.
At present there is a vague listing, weather beaten/tired sinage and seemingly disinterested agents who want to
flog their other listings instead of the NAMA property because selling the NAMA property seems to be just too hard.
The Government should give NAMA 12 months to clear the decks, pay down some debt and consolidate debt so the taxpayer can know where the country is at debt-wise.
Corruption after corruption after corruption the greed is alive and well.
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