NAMA to fast-track transfer of Anglo loans
Published 10/09/2010 | 05:00
THE National Asset Management Agency (NAMA) may be asked to take over the remainder of Anglo Irish Bank's development loans at a "block discount" to speed up calculations on the bank's funding needs.
The Irish Independent has learnt that the block deal is one of a handful of options being mulled over by the Department of Finance as it battles to bring 'clarity' to Anglo's finances by October.
As things stand, Anglo's loans are being assessed on an individual basis so the bank won't know the hit on the remaining €19bn of loans it's transferring until February, when the final loans migrate to the State's bad bank.
Finance Minister Brian Lenihan this week hinted that Anglo's NAMA process might be fast-tracked to enable the Financial Regulator to rule on the bank's capital requirements "by October", adding that a variety of NAMA options could be considered "in a very short space of time".
Sources last night said any fast-tracking would most likely see Anglo's loans transferred to NAMA en-masse at a uniform discount, cutting out the need for time-consuming due diligence.
NAMA would later carry out a detailed review of the loan book, and the difference between the applied discount and the actual discount merited by the portfolio would be settled at a later date.
Industry sources said the uniform discount applied would most likely be higher than the 62pc applied to the most recent tranche, so as to minimise the chances of Anglo having to pay back any money.
Another option would be to ask NAMA to prioritise Anglo's transfers over those of the other banks, but sources said this could prove impractical given the demands it would place on Anglo.
A spokesman for NAMA declined to be drawn on the details of its future dealings with Anglo but said the agency "clearly recognises the urgency of bringing clarity to the question of the value of Anglo transfers to NAMA as quickly as possible".
Separately, the latest plans to set up an Anglo savings bank have triggered concern amongst several other industry players, despite Mr Lenihan's assurance that the new bank will not be allowed to engage in "predatory pricing".
While declining to comment on Anglo specifically, Roel van Veggel, general manager of online savings bank RaboDirect, said a government-owned funding bank "won't help bring a level playing field to Irish banking".
"RaboDirect expects that the funding bank will have realistic interest rates and not misuse its specific position," he added.
"In many other EU countries, banks that survive because of government support are not allowed to offer the highest interest rates, and I would expect the same to apply to this new bank."
Several sources in domestic Irish banks also expressed concerns that the new bank would have an unfair competitive advantage since its stage ownership would give it an implicit 100pc government guarantee.
Other banks can avail of a variety of state guarantees, but most of these are due to expire in December.
An undated guarantee on retail deposits of up to €100,000 is also in force, but sources point out that retail savers with more than €100,000 could be tempted to go to the new Anglo bank since an unlimited amount of their savings are guaranteed.