Banks' dash to tie down security on NAMA loans led to backlog
Published 25/08/2011 | 05:00
Frantic efforts by banks to tie down the security attached to thousands of NAMA loans caused a backlog in the Companies Office last year, it has emerged.
The transfer of property loans to NAMA throughout 2010 forced banks to secure the collateral behind a huge amount of loans in a short space of time.
It has previously emerged that many banks had inadequate security and poor documentation backing up their loans.
In its latest annual report, the Irish Companies Office said: "2010 posed significant challenges for the mortgages and charges processing team.
"An increase in the number and complexity of submissions was recorded in 2010 in line with Irish bank activity in transferring certain loan books to NAMA as well as reviews by lenders of their security arrangements generally."
The office said banks had to file additional submissions on the basis that action would be taken against certain firms.
NAMA has castigated the banks on several occasions for the poor quality of the security underpinning certain loans.
In some cases NAMA has discounted the value of loans by 100pc.
The scale of property lending from 2001 to 2007 meant that banks were often stretched beyond capacity to arrange and secure all collateral.
"There was an increase in the number of judgment mortgages received from 156 in 2009 to 268 in 2010," said the office.
"As a result of these issues, processing of submissions within 20 working days was not achieved in all cases in 2010 but the backlog is being systematically worked through and additional resources have since been redeployed," it added.