Almost 100 Nama names with debts of €11bn went bankrupt
Published 20/06/2015 | 02:30
Finance Minister Michael Noonan has revealed that 92 debtors in Nama with combined debts of €11bn have declared themselves bankrupt.
Minister Noonan also revealed that more than half of those who declared themselves bankrupt have been discharged from their bankruptcy.
In a written Dail response to Fianna Fail's Michael McGrath, Mr Noonan stated that 54 of those 92 bankrupts have been discharged.
The figures provided show that since June of last year, an additional 15 Nama debtors have declared themselves bankrupt.
The UK is the location of choice for those developers declaring themselves bankrupt, giving rise to 'bankruptcy tourism' due to the more favourable regime there where debtors can exit bankruptcy after one year.
The figures show that 70 Nama debtors have declared themselves bankrupt in the UK, or 76pc of the overall total, with 20 declaring themselves bankrupt in Ireland and two doing so in the US.
The numbers of Nama debtors declaring themselves bankrupt reached a peak in 2012 when 32 did so - with 29 doing so in the UK.
In 2013, this reduced to 18. That included 15 in the UK while another 15 declared themselves bankrupt last year - 10 in the UK and five in Ireland.
To date this year, three Nama debtors have declared themselves bankrupt in Ireland with one doing so in the UK.
The Minister also revealed that this year, three Nama debtors have been discharged from bankruptcy and this followed 13 in 2014, 25 in 2013, 12 in 2012 and one in 2011.
Some of those developers to exit bankruptcy in the UK include developers Bernard McNamara, Paddy Shovlin and John Fleming. In his written response to Deputy McGrath, Minister Noonan said: "As a secured lender, Nama's experience has been that bankruptcy has not prejudiced recoveries on secured assets.
"As a secured lender, Nama is legally entitled to enforce over and to realise the assets securing its loans.
"This is not affected by debtor bankruptcy."
He added that "Nama advises me that in practically all bankruptcy cases involving its debtors, it had enforced over or had realised the secured assets securing its loans prior to the debtor's filing for bankruptcy". Minister Noonan also pointed out that "Nama does not write off its unsecured debt as a result of a debtor being adjudicated a bankrupt".
He added: "It is a matter for the bankruptcy proceedings in the relevant jurisdiction to deal with the bankrupt's debts and, even after the bankrupt has been discharged, the bankruptcy estate continues to be administered by the bankruptcy official until such time as all assets have been liquidated and the debt, in so far as possible, has been repaid."
He said Nama has advised "that the winding up of bankrupt estates in the vast majority of cases involving its debtors is ongoing".
Minister Noonan said that a debtor's bankruptcy doesn't result in a debtor's impairment position deteriorating.
Deputy McGrath said: "While Nama has made good progress in selling down its assets the number of debtors who have gone bankrupt underlines the serious difficulties Nama will continue to face in recouping the maximum amount possible for the taxpayer."
Mr McGrath said "it is essential the agency is adequately resourced, even during its wind-down phase" to secure the greatest possible return.