Opposition calls for clearout of tainted bankers in Nama
Opposition politicians have claimed that bankers responsible for many of the "reckless" lending practices in AIB and Bank of Ireland are now handling the transfer of properties into Nama.
In the week that the first €8.5bn Nama payout was announced, staff members in the banks who loaned money to developers and speculators are now working on the Nama operation, it has been claimed.
In total, bailing out the banks could cost far in excess of €75bn. It is estimated that more than €40bn will be required to sort out Anglo Irish Bank alone, between re-capitalisation and buying the crippled bank's toxic loans.
However, there have been angry calls from opposition politicians for a wholesale clearout of those responsible for "reckless lending".
Fine Gael senator and former banker Paul Coughlan told the Seanad it was totally wrong that those people who had wrecked the economy should now remain in position in the banks.
"We need a wholesale clear-out of the people responsible for the reckless lending practices in relation to property," he said.
But Senator Coughlan went further, saying he was incredulous that those who were directly involved in disastrous lending were now managing the country's way out of the crisis.
"It's totally wrong that these people have been put in charge of the loan portfolios after the mess they have caused," he told the upper house.
"It is beyond belief that they have been shifted sideways to look after these loans."
The Labour Party's finance spokeswoman, Joan Burton, said promises and guarantees were given at the time that the Nama legislation was being drawn up that those who were involved in the disastrous lending decisions would not be involved in cleaning up the mess.
She said: "This means that those who made all the bad decisions will spend their time justifying those bad decisions.
"We need total honesty and a fresh start because otherwise we can't ever move on."
While the State's bad bank is in overall charge of the process of working out the toxic assets, Nama has outsourced the day-to-day activities to the various banks on an agency-type basis. Many of those involved in lending within the two big banks are now working on Nama loans.
Sources at the banks have said it is felt that those who authorised loans to the developers during the boom years should work this mess out.
Last week, the taxpayer, through Nama, committed to paying €8.51bn for loans that have a book value of €16.03bn. This transfer of assets to the State's bad bank is only the first tranche of loans.
Last Tuesday, AIB discovered that it would receive €1.88bn for loans valued at €3.29bn. Anglo is to get €5bn for loans of €10bn.
Bank of Ireland got €1.26bn, Irish Nationwide €280m and the EBS €90m.