NAMA welcomes publication of Minister’s Section 227 Review
25 Jul 2019)
25th July 2019 - The National Asset Management Agency (NAMA) welcomes the publication today of the second review of NAMA by the Minister for Finance. In line with Section 227 of the NAMA Act 2009, the Minister is required to assess the extent to which NAMA has made progress towards achieving its objectives. With the publication of the second review, the Minister concludes that NAMA has made extensive progress in achieving its overall objectives and that its continuation is therefore necessary.
As part of his review, the Minister recommends that NAMA should continue to manage its residual loan book beyond 2021 in order to deliver the best financial return for the taxpayer in line with its obligations under Section 10 of the NAMA Act. The review highlights the potential for NAMA to exceed current expectations through the appropriate asset management of the residual loan portfolio, secured by residential development sites in Ireland which have significant medium-term value uplift potential. The review also notes that NAMA will continue to manage ongoing litigation appropriately. NAMA currently estimates that the size of the residual loan portfolio in 2021 will be approximately €300m, less than 1% of NAMA’s original portfolio at inception.
The review acknowledges the considerable contributions made by NAMA to the social and economic development of the State, especially in the area of social housing. The review recommends that NAMA retain ownership of its social housing vehicle, NARPS, and that the vehicle should form part of the assets to be transferred to the State once NAMA has completed its deleveraging activities.
NAMA Chairman, Mr. Frank Daly, stated:
“The NAMA Board welcomes the review’s conclusion that NAMA has made extensive progress in achieving its overall objectives and that its continuation is therefore necessary. I am pleased that the Minister’s review recognises what has been achieved by NAMA to date and that it takes a positive view of NAMA’s future prospects. The extension of NAMA’s remit to 2025 will enhance the return to the State by ensuring the orderly completion of NAMA’s work.”
NAMA Chief Executive, Mr. Brendan McDonagh, stated:
“This review comprehensively outlines NAMA’s success in deleveraging its portfolio profitably and sets out a clear framework that will enable NAMA to plan its activities over the coming years in a manner that maximises the value of its remaining assets for the taxpayer.”
BACKGROUND NOTE:
The Department of Finance has today (25 July 2019) published the Review of NAMA under Section 227 of the NAMA Act. Section 227 requires the Minister to assess the extent to which NAMA has made progress toward achieving its overall objectives, and decide whether continuation of NAMA is necessary having regard to the purposes of this Act. A copy of the Review is available at the Department’s website www.finance.gov.ie .
Issued on behalf of NAMA by
Gordon MRM