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NAMA turns €118m profit in second quarter of 2011

The State’s ‘bad bank’ increases profits, making €118m in three months, generating over €800m in cash in the three months.

Frank Daly, NAMA chairman, has confirmed that the agency has now acquired all eligible loans - at a 57 per cent 'haircut'.
Frank Daly, NAMA chairman, has confirmed that the agency has now acquired all eligible loans - at a 57 per cent 'haircut'.
Image: Laura Hutton/Photocall Ireland

THE NATIONAL ASSET Management Agency has announced its second successively quarterly profit for 2011, having made €118m in the three months between April and June.

The agency, which bought development loans from banks at an average discount of almost 60 per cent, took in €828m in cash through the repayment of loans and sale of assets secured on them.

It also took in €51m in what it called “derivative inflows” associated with those loans.

The €118m profit compared to a profit of €91m for the first quarter of the year – and came despite its repayment of €500m in bonds which had fallen due over the quarter.

NAMA said the proportion of its loans which were still ‘performing’ – that is, loans which were being repaid – was unchanged from the first quarter, at 23 per cent.

Despite repaying the bonds, the agency still had a cash balance of over €1bn, and had invested a further €182m, by the end of June.

In a statement this afternoon, chairman Frank Daly said the agency had last month completed the acquisition of the last two outstanding eligible, completing the purchase of two loans worth €1.9bn.

That meant that the agency had taken over a grand total of €74.2bn in loans, paying €31.7bn for the privilege – a 57 per cent ‘haircut’ on the original value of those loans.

The agency has also received 170 business plans submitted by its 188 debtors – and was making inroads in processing the business plans of 600 debtors whose loans are being managed by other institutions on NAMA’s behalf.

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Gavan Reilly

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