NAMA to take on extra €7bn in 'vulnerable' development loans
NAMA will be taking over extra development loans, worth up to €16.6bn.
NAMA's remit will be widened to include the all remaining "vulnerable land and development loans" from Bank of Ireland and Allied Irish Banks.
The deadline for the transfer of these loans is March 2011.
"This process will be carried out in a carefully balanced and controlled manner with the benefit of the substantial resources available to the banks for their funding and capital needs," a government statement said yesterday.
NAMA had previously said that it would not be taking property loans worth €20m or less from the two main banks and instead they would have to work through these loans themselves.
However, yesterday's announcement means that all the risky loans from AIB and BoI will be transferred to the so-called bad bank by the end of March next year.
This would mean that thousands of smaller property loans, largely made up of syndicated loans, will now be transferred to the agency.
More than 650 developers have loans of between €5m and €20m in both banks - worth €6.6bn.
Yesterday it emerged that both banks hold loans of between zero and €5m to the value of €10bn.
This gives a combined total of €16.6bn of extra loans going into NAMA.
NAMA already is already working through the loans of 850 developers, with loans of €73.4bn to worry about.
Thirty of the top developers, who transferred loans totalling €27bn, are currently in talks with NAMA about their business plans.