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NAMA: making it up as they go along


Libero

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May 22, 2004
Messages
3,000
It's been a big morning for Irish politics and economics, hasn't it? A big morning for Irish life, in fact.

So big, you might have missed something important about NAMA.

It's operations are being fundamentally changed.

We all remember being solemnly told that NAMA would acquire property finance related loans with a nominal value in excess of €5m. Not any more. Now, in relation at least to AIB and Bank of Ireland, NAMA will only acquire such loans in excess of €20m.

This change will be the main driver in reducing the number of NAMA debtors from 1500 to 850.
The Government has decided, having consulted with the NAMA Board and the European Commission, that where the total exposure of a debtor is below a €20 million threshold in AIB and Bank of Ireland, that debtor’s loans will not now be transferred to NAMA. The threshold had previously been set at €5 million. … I have been advised by NAMA that there are 650 debtors with property-related debts of between €5m and €20m in these two banks. They account for just €6.6bn of the aggregate €80bn volume of NAMA eligible loans.”
http://irelandafternama.wordpress.com/2010/09/30/changes-in-nama-rules-for-aib-and-boi/

Surely NAMA must quickly publish a revised business plan. Everything changes with an announcement like this, from NAMA's funding needs to its forecast recovery rate, to staff numbers and outside advisors.

The excellent NAMAwinelake draws attention to the ever-decreasing amount scheduled for transfer from Bank of Ireland to NAMA. Is it a mechanism whereby the bank keeps better quality loans from transfer to NAMA? Is this to save the bank from recognising the full extent of its bad loans?
NAMA scope and operations significantly altered « NAMA Wine Lake

So much for NAMA cleaning up the balance sheets of the banks, bringing a measure of finality, and helping get credit moving.

Lenihan is making it up as he goes along.
 


EvotingMachine0197

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Feb 17, 2006
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8,629
I feel like watching the 'Blessed are the cheesemakers' one ..

Hadn't they budgeted €2.5 Billion or something for legal fees ? So we can expect a significant reduction in this presumably ..
 

SilverLining

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Jun 7, 2009
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1,373
This is a complete cover up of the mess left for us by the antics of Anglo, Golden Circles, FF Developers and their political buddies. We are being continually being lied to. The last two years was a smoke screen in an stupid attempt to shut us all up so we would bale them out with this crazy digout.
 

orbit

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Dec 5, 2008
Messages
701
I don't know the reason for this, but is it not plausible that it's down to a question of human resources (ie management)? ie it may be better for them to concentrate their resources on the big fish. Nearly half the debtors only account for just over 8% of the loans. It doesn't sound like the issue is quality. It's simply scale.

But, are they making it up as they go along? Of course.
 

spidermom

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Sep 13, 2008
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9,189
plus the loans are to be tranferred before Halloween...and not by next Spring!!
 

jimbo99

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Jul 2, 2009
Messages
574
I don't know the reason for this, but is it not plausible that it's down to a question of human resources (ie management)? ie it may be better for them to concentrate their resources on the big fish. Nearly half the debtors only account for just over 8% of the loans. It doesn't sound like the issue is quality. It's simply scale.

But, are they making it up as they go along? Of course.
Why do we need state owned banks and Nama to collect a loan. Nama should be abolished and the loans returned to the banks (now state owned) Think of the billions that could be saved by letting NAMA go. The biggest smoke screen ever created by FF and its well money'd supporters. The markets never fell for NAMA being off balance sheet government debt why hould we?
 

thebig C

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Jun 19, 2008
Messages
856
Good op libero. Actually, is it just me or is the reaction and publicity very muted and resigned considering we have just passed a generation defining moment?!
 

libertarian-right

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Apr 23, 2007
Messages
2,492
Good op libero. Actually, is it just me or is the reaction and publicity very muted and resigned considering we have just passed a generation defining moment?!
The mainstream media are failing us completely and most people I know are sick of them and bypass them at this stage for online content. Probably a discussion for another thread.

Surely a change of such importance as this merit's re-evaluating NAMA's estimates and overall strategy/plan?!?
 

meriwether

Well-known member
Joined
Dec 1, 2004
Messages
12,591
It's been a big morning for Irish politics and economics, hasn't it? A big morning for Irish life, in fact.

So big, you might have missed something important about NAMA.

It's operations are being fundamentally changed.

We all remember being solemnly told that NAMA would acquire property finance related loans with a nominal value in excess of €5m. Not any more. Now, in relation at least to AIB and Bank of Ireland, NAMA will only acquire such loans in excess of €20m.

This change will be the main driver in reducing the number of NAMA debtors from 1500 to 850.
“The Government has decided, having consulted with the NAMA Board and the European Commission, that where the total exposure of a debtor is below a €20 million threshold in AIB and Bank of Ireland, that debtor’s loans will not now be transferred to NAMA. The threshold had previously been set at €5 million. … I have been advised by NAMA that there are 650 debtors with property-related debts of between €5m and €20m in these two banks. They account for just €6.6bn of the aggregate €80bn volume of NAMA eligible loans
Changes in NAMA rules for AIB and BoI « Ireland after NAMA

Surely NAMA must quickly publish a revised business plan. Everything changes with an announcement like this, from NAMA's funding needs to its forecast recovery rate, to staff numbers and outside advisors.

The excellent NAMAwinelake draws attention to the ever-decreasing amount scheduled for transfer from Bank of Ireland to NAMA. Is it a mechanism whereby the bank keeps better quality loans from transfer to NAMA? Is this to save the bank from recognising the full extent of its bad loans?
NAMA scope and operations significantly altered « NAMA Wine Lake

So much for NAMA cleaning up the balance sheets of the banks, bringing a measure of finality, and helping get credit moving.

Lenihan is making it up as he goes along.
Whazt is the problem here - is it that you feel:

- The decision to raise up the threshold is incorrect
- You feel that 'it is been made up as they go along'.

To me, the threshold itself isn't overly significant - in that I have no attachment to 5m, as opposed to feeling 6m, or 4.5m or 20m is better. What am I misisng here?
 

orbit

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Joined
Dec 5, 2008
Messages
701
Why do we need state owned banks and Nama to collect a loan. Nama should be abolished and the loans returned to the banks (now state owned) Think of the billions that could be saved by letting NAMA go. The biggest smoke screen ever created by FF and its well money'd supporters. The markets never fell for NAMA being off balance sheet government debt why hould we?
Even if all the banks were state owned (which they aren't) I'd still see a need for NAMA, or some vehicle to separate the good from the bad (or the most toxic from the rest, however you want to look at it) and to manage the loans according to certain strategic objectives. The last thing we'd need is (temporarily) nationalised banks becoming just another arm of the state.
 

markeys

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Feb 11, 2008
Messages
273
Good op libero. Actually, is it just me or is the reaction and publicity very muted and resigned considering we have just passed a generation defining moment?!
I think the mood is one of hopelessness. We have liars, thieves and gombeens running the country. From those that inhabit the office of government to the heads of state agencies to those controlling semi-state organisations. Even the gardai can't seem to put a file together to prosecute white collar criminality. Just look at any semi-state/agency to see its boards packed with FF/Green cronies. Nobody gives a sH*T what these tossers do anymore, because everybody knows that default is coming down the tracks and its only a matter of time.

So everybody sits still, doesn't spend, doesn't invest, everything falls a bit further and the process repeats. Meanwhile, we all watch as the elite incompetents try to spin us more lies and more fairytales about what 'they' will do, that our 'falling' has eased, that they won it on the nags, that they never really lied in court, that it's not a junket, that really, they're worth their extortionate wages and salary perks.

But you know what? They'll fail miserably, just like they've done at every challenge they've faced for the last decade. From the Taoiseach right through to the morons staffing the dept. of finance, they've got not one thing right. And they haven't got today right. And if FG/Labor don't step up to the plate and come out and say they'll fire all of these wafflers, that they'll purge the state boards of people that are only there because of political connections, that they'll hold those who lied to the dail responsible, then we're doomed to watch the same slow scenario play out all over again.

Sad to say it, but there is a complete lack of moral authority amongst all the politiicians in the dail, an absense of which has led to people becoming just downright despairing and angry at their 'representatives'. None of them know what courage is. None of them knows how to do what is right. It's the same self serving principles of party before people and looking after one's supporters first, to the detriment of the state. It's not that this mean's they are all equal, it just means FF are the worst (or best) at it, the others only varying shades of degree behind.

I consider the country lost until the gombeens are put out of power. Even more so, we're doomed to some form of backwater red-neck embarrassment of a country until Irish people learn not to vote for those who shafted them in the first place. But that's hardly likely to happen. Watch all the fools vote back in the same gangsters again.
 

dalywise

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Joined
Feb 23, 2008
Messages
811
This is a complete cover up of the mess left for us by the antics of Anglo, Golden Circles, FF Developers and their political buddies. We are being continually being lied to. The last two years was a smoke screen in an stupid attempt to shut us all up so we would bale them out with this crazy digout.
Yes, thet's the most amazing aspect of the past 2 years. Not that Fianna Fail lied to us continuously, (they have always lied to us), but that public and civil servants have also facilitated and collaborated in pushing Fianna Fail's lies at every turn. It's no wonder Lenihan gave them a soft deal on the pay cuts last year.

The system is rotten to the core.
 

Libero

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Joined
May 22, 2004
Messages
3,000
Whazt is the problem here - is it that you feel:

- The decision to raise up the threshold is incorrect
- You feel that 'it is been made up as they go along'.

To me, the threshold itself isn't overly significant - in that I have no attachment to 5m, as opposed to feeling 6m, or 4.5m or 20m is better. What am I misisng here?
Was the threshold of €5m ever, ever presented as being a working figure, non-final and subject to revision?

I don't think so.

At least, if it ever was described that way, I missed it. And so did all the professional advisors who told their clients, in numerous consultations and general briefings, that €5m was the figure, and that was that.

I expect the EU Commission also gave its approval predicated on the €5m threshold figure (since the EU approval certainly referred directly to the overall size of acquired loans, which is a derivative of the threshold figure).

So, yeah, the driver of my astonishment is the sudden, unexpected change to a fundamental feature of NAMA. Hence the thread title.

And it doesn't bode well for the future operational performance and integrity of NAMA that it has its mandate chopped and changed like this.

The sudden change also gives the lie to claims that NAMA would, by definition, remove a class of toxic property loans from banks' balance sheets, and so bring clarity and finality to that aspect of the banking crisis. Now, the two big, truly systemic banks in the state will be left with all those €5m-€20m property development loans, even though they will form a material part of the assets in the balance sheet.

You still don't see a problem?
 

adrem

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Joined
May 27, 2004
Messages
924
The banks want to get as much as possible over to NAMA - not the other way around. Anecdotal evidence was that some loans were being rolled up to breach the 5M and get NAMA'd - they're all staying with the banks now.

The 20m change makes sense and doesn't impact the big picture
 

jimbo99

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Joined
Jul 2, 2009
Messages
574
The banks want to get as much as possible over to NAMA - not the other way around. Anecdotal evidence was that some loans were being rolled up to breach the 5M and get NAMA'd - they're all staying with the banks now.

The 20m change makes sense and doesn't impact the big picture
It certainly must impact the big budget for professional fees. Workload now reuced by 50% reduce the NAMA budget by 50% now.
 

WTTR

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Sep 25, 2009
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www.johnfhiggins.eu
How much money are they going to put into AIB?

You all are missing the point of the raising of the threshold for NAMA. The government are now in a stronger position than they have ever been, since we became a Republic.

They will now own the largest bank AIB.

The FF crowd don't borrow from B of I; they championed Anglo as a swipe in the face of the "Prod" bank.

The FF small developers and property players all banked with AIB.

How much money are they going to put into AIB? :rolleyes:

They will now have control where this money goes :?

So in their little manoeuvrings, FF are still ahead of ye all, the Dail opposition etc.

By: long term banking and political observer :cool:
 

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