Monday 19 February 2018

Booming market puts NAMA on track for €1bn profit

Brendan McDonagh, Chief Executive, speaking at the publication of NAMA's (National Asset Management Agency) Annual Report and Financial Statements for 2013 yesterday. Picture credit Tom Burke
Brendan McDonagh, Chief Executive, speaking at the publication of NAMA's (National Asset Management Agency) Annual Report and Financial Statements for 2013 yesterday. Picture credit Tom Burke
Thomas Molloy

Thomas Molloy

The National Asset Management Agency could make a profit of €1bn by the time it winds up thanks to the booming commercial property sector, sources said.

A profit along these lines would mean that NAMA hits the original targets agreed back in 2010 when the agency was set up.

In September, NAMA warned it would probably be closer to breaking even than making the €1bn profit it outlined as a "central scenario" in 2010.

NAMA chief executive Brendan McDonagh said the agency may yet make a profit when it winds down. It must first repay senior and junior bondholders but could also end up paying the Government a surplus as well. He declined to speculate on how much would be paid.

Targets

NAMA chairman Frank Daly said at the launch of the agency's annual report in Dublin yesterday that the agency was two years ahead of schedule when it comes to selling off loans.

"We're beating our targets," Mr Daly said. "It's becoming increasingly likely that NAMA will achieve its objectives sooner than anyone would have expected when it was set up in late December 2009."

Mr Daly added he was more confident than ever that NAMA would make a profit, though it's too early to say how much.

NAMA has pulled off some of its biggest deals this year. Last month, the agency agreed to sell £4.5bn (€5.5bn) of property loans to affiliates of Cerberus, the New York-based private equity firm, and chose Blackstone as the preferred bidder for about €1.8bn.

NAMA reported a profit after impairment, tax and dividends of €211m for 2013, its fourth year in operation.

The impairment charge for the year was €914m, following a review of impairment provisioning.

The Government has commissioned a report on the future of NAMA and this is due to be completed next month, Finance Minister Michael Noonan said.

That may well call for the agency to speed up asset sales.

Nama is two years ahead of schedule and "is not a long-term project," Mr McDonagh said. Cash generated was €4.5bn including asset disposals by debtors and receivers and rental income.

It also said that, by the end of 2014, it plans to have redeemed a total of €15bn in senior debt, 50pc of the amount it issued to acquire loans.

From inception to date, NAMA has generated €18.6bn in cash, including €14.1bn from asset disposals, it said in its annual report.

"We reported a profit for taxpayers for the third year in a row and successfully met our first major milestone of repaying €7.5bn of NAMA's debt in full and on time," Mr McDonagh added.

Irish Independent

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