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Urgent talks as NAMA loses one in 10 staff this year


Eddie Byrne of Hudson Advisors

Eddie Byrne of Hudson Advisors

Eddie Byrne of Hudson Advisors

NAMA has lost 10pc of its staff so far this year and is in talks with government over how it can retain key employees.

Since the start of this year 37 staff members have left the agency, which has a total workforce of 370, chief executive Brendan McDonagh said yesterday.

He declined to comment on whether he has been approached by private sector employers looking to lure him away from Nama.

The inability to retain staff is a “concern” at the moment.

Hypothetically, if it continues to lose people at the current rate it could become a risk to its ability to deliver housing and office developments that have been requested by Finance Minister Michael Noonan, he said.

 “The minister acknowledged this himself in his Section 27 review (of Nama),” Mr McDonagh said. Asked if he has been approached by prospective employers, Mr McDonagh declined to comment.

“I won’t comment on myself, it would be unfair,” he said.

Mr McDonagh was speaking at the International Corporate Restructuring Summit 2014, organised by Business & Finance  in the Convention Centre in Dublin yesterday.

Nama has previously floated the idea of making some kind of “retention payments” in order to hold on to staff, who know that their jobs will be lost as the agency is wound down between now and 2020.

Any kind of bonus for Nama employees, who earn an average salary of €90,000, would be likely to be politically highly sensitive.

“There is a whole political dimension,” Mr McDonagh said.

Nama is playing its part in the national recovery, he said.  A contingent liability – an indirect debt that could potentially have ended up being shouldered by taxpayers – was €43bn when the agency was set up. This will have dropped to €5bn by the end of 2016 thanks to debt repayments, he said.

“It is important to see that light at the end of the tunnel,” he said. While the situation is  improving, the Nama chief said executive investments being made today based on ultra low interest rates could be a danger.

“There is a danger it (low borrowing costs) might encourage all the wrong behaviour again,” he said. Brendan McDonagh was one of the speakers at the event, where the sales over the past two years of huge volumes of loans by Nama and the banks here to mostly US private equity funds was a major focus.

Private equity as an industry was represented by Eddie Byrne (pictured) of Hudson Advisors, part of the huge Lone Star group, who spoke at the event.

Despite sometimes getting a bad press, the industry helped stabilise the economy, he said.

Sales of loan portfolios will be the catalyst for further major investment here but because those sales are followed up with further capital expenditure ranging from 5pc to 100pc of the size of the original deal, Mr Byrne said. As new owners, firms like Lone Star have “no baggage” he said.  By cleaning up and right sizing the balance sheets of companies private equity makes them invest-able, he said. The €14bn spent by private equity firms to date here will lead to a further €1bn of investment, he said, as assets are brought back up to standard.

There will be a likely €3bn of follow-on investments here after loan portfolios have been bought, he said. That will create in the region of 42,000 jobs, many in construction, he added.

“The potential to create jobs is absolutely massive,” he said.

Lone Star has emerged as one of the biggest buyers of Irish loan assets since the crash.

In response to a question about the regulatory burden of doing business here, Mr Byrne said that in terms of holding commercial loan assets there is no regulatory issue.

Lone Star has voluntarily signed up to respect the consumer code that covers householders after buying mortgages here, he said.

Lone Star’s acquisition this week of the old Start Mortgages business means that it also owns a regulated unit here, and now also has the capacity to start lending here, as a licences retail lender.

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