Tuesday 25 April 2017

UK company main winner in fees to be paid out by NAMA

PROPERTY

Emmet Oliver, Deputy Business Editor

The UK company Capita, which collects Britain's television licence fee, has emerged as the main winner from fees scheduled to be paid out by NAMA this year.

Based out of its Irish office in Maynooth, Co Kildare, Capita Asset Services is set to share a large portion of the €73m of fees which will be paid out to those doing the administrative work on NAMA's thousands of individual loans.

Capita, which is one of the largest providers of outsourcing services in the UK, operates as what is known as NAMA's "master servicer'', providing bookkeeping and records man- agement for all of NAMA's major loans. The banks also share some of the €73m fees for managing some loans at a local level.

NAMA is on course to pay out €133.2m in fees, according to figures supplies to the Oireachtas by NAMA chief executive Brendan McDonagh.

One of the most lucrative areas for consultants and accountants firms from NAMA is fees paid out for reviewing developer's business plans. This is currently running at €9.8m, but is set to grow to €15.2m by the end of the year, according to figures from Mr McDonagh.

Lawyers' fees are also set to cost the agency €10m. This is for advice the agency has received. It is understood the largest four firms have been used over the last year, including Arthur Cox and William Fry.

Capita won the master servicer contract in May 2010 after a tender was held. It was one of the first contracts awarded by NAMA.

Among Capita's Irish directors is Arnold O'Byrne, the former chief executive of Opel Ireland, famous for sponsoring the Irish football team during the Italia '90 tournament.

Capita, which first hit the headlines for winning the contract for London's congestion track, has been expanding rapidly as companies outsource more of their back office work.

Capita is often used by banks for loan processing and work on loan arrears.

The stock exchange-listed company currently manages over £35bn of commercial real estate loans on behalf of international banks in Europe.

NAMA has come under fire in recent days for salaries it allows some developers to be paid. Two developers are paid €200,000, while about 100 developers are paid between €70,000 and €100,000.

The agency said while it did not want to allow such salaries, the fees charged by receivers and liquidators would often be higher and receivers and liquidators were not as knowledgeable about portfolios.

The agency has so far shunned the idea of selling large portfolios of loans, an approach that was used during the US Savings and Loan crisis. Senior NAMA executive John Mulcahy recently said he would look at alternative approaches.

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