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Nama CEO Brendan McDonagh
Nama CEO Brendan McDonagh
Image: Laura Hutton/Photocall Ireland

Nearly all the assets from Nama's €17.5 billion in fire sales have gone to offshore buyers

And the bad bank’s boss says if overseas owners want to pull apart Irish businesses there’s not much he can do.
Oct 22nd 2014, 5:12 PM 12,121 34

LESS THAN 7% of Nama’s €17.5 billion in fire-sale assets have gone to Irish buyers – and the bad bank’s boss has admitted there’s nothing he can do if offshore vulture funds wanted to pull apart local businesses.

National Asset Management Agency (Nama) CEO Brendan McDonagh today told a Oireachtas Finance Committee meeting that only 6.9% of its total asset sales, which are made up of both loans and properties, had gone to domestic buyers.

He said US buyers had snapped up nearly 90% of the massive portfolio and it was probably true that the “vast majority” of those purchases had gone to private-equity funds.

“The majority of the (money) coming in to buy assets from Nama is US based,” he said.

“There are some big individuals who are buying assets in their own name, and they are obviously very rich, but the majority are funds.”

He said that 3.5% of the total portfolio went to German buyers and 1.2% was bought with UK funds.

About two thirds of Nama’s total portfolio was for assets in Ireland, with the majority of the remainder in the UK – primarily in Northern Ireland.

Buyers could ‘asset strip’ Irish businesses

Under questioning from Fianna Fáil finance spokesman Michael McGrath, who asked what Nama would do if a purchaser planned to “asset strip” an existing Irish business that was linked to one of the loans, McDonagh said the agency’s job was to get the best returns it could on sales.

Fianna Fail Michael McGrath. Pictured Fianna Fáil's Michael McGrath Source: Sam Boal/Photocall Ireland

“We haven’t seen any buyer to date that has told us they wanted to buy a business and engage in asset stripping,” he said.

“We have to take the commercial view that once we sell the assets whatever the buyer is going to do with it is up to him because he’s paid for it.”

Several major overseas private-equity firms, including US-based Blackstone and Cerberus Capital Management, have bought up big packages of Nama-owned debts.

A profit within three or four years

In its policy statement for next year, Nama bosses said the stronger property market meant it was likely to wind up earlier than expected – possibly by late 2017.

File Photo The National Asset Management Agency has announced its biggest ever transaction to date. NAMA said it has sold its Project Eagle portfolio of loans to Cerberus Capital Management, subject to contract Source: Sasko Lazarov/Photocall Ireland

The bad bank has forecast it would at least break even on the billions in taxpayer funds that had been sunk into it to buy up loans from ailing lenders during the financial crisis.

Today, when pushed to put a figure on its final performance, McDonagh said he was expecting a profit of ”somewhat less than €500 million” after it shut down all its operations.

In a separate statement, Nama said it had now repaid half of the €30.2 billion in senior debt it had issued to buy up loans and that it was on track to pay back 80% of the debt by 2016.

READ: ‘Highly unlikely’ that Nama will still be operating by 2020 >

READ: Nama is selling €600m in properties – although it won’t tell us exactly what >

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Peter Bodkin

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