Saturday 24 March 2018

Root of chaotic fire sale can be traced to ECB

Frankfurt's damaging refusal to act as lender of last resort was ­contrary to ­advice by the IMF and spurred Nama's decision to sell into a weak market, writes Colm McCarthy

NAMA was established in late 2009 to buy property-related loans from Ireland's bust banks at a discount. The intention was that the assets be warehoused and fed gently into the market, avoiding a chaotic fire sale.

Nama was given a 10-year time horizon to dispose of its monster portfolio and hired hundreds of staff and professional advisers for the task.

It paid the banks with government-guaranteed paper which they could use to borrow real money from the Irish Central Bank, with permission from the European Central Bank in Frankfurt.

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