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Bailey brothers expect NAMA approval for new business plan

Developers Tom and Michael Bailey, who control Bovale Developments, expect to get approval from NAMA for their business plan shortly despite the company being in a loss-making position.

Talks between the two sides will conclude shortly and the brothers are confident their business plan will get NAMA's support, putting the company on a more long-term footing.

Auditors to Bovale state: "The directors are confident that the plan submitted, or a variation thereof, will be accepted by NAMA.''

The company incurred losses in the year to the end of June 2010 and its ability to continue as a going concern is dependent on the support of NAMA, its key lender. Bovale is a housebuilder that operates mainly in north Co Dublin, but also does retail developments, the most well know of which is Charlestown in Finglas.

The auditors claim it is extremely difficult to value property assets at present because there are not enough transactions taking place.

"The current economic difficulties being experienced in Ireland have resulted in significantly reduced numbers of property transactions,'' the accounts point out.

Market values

"The resulting lack of comparable evidence for market values has decreased the degree of certainty in valuations, as compared to those in a more stable market with a normal level of activity,'' the auditors state.

Meanwhile, NAMA yesterday updated the markets on its progress in repaying some of the €30.5bn of debt it has issued to the banks in return for buying their property loans.

NAMA said it had repaid a further €500m of NAMA bonds, the third repayment of bonds so far this year. This brings the total of NAMA bonds redeemed to some €1.25bn.

"In addition to repayments of €299m in advances made by the Minister for Finance [repayments made in October 2010 and end February 2011], the news means that NAMA has reduced its indebtedness by €1.55bn in approximately 18 months,'' NAMA pointed out.

Frank Daly, chairman of NAMA, said that "further bond repayments are likely before the end of this year and our ability to make these repayments reflect the agency's very strong cash-flow position".

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