National Asset Management Agency

@KerryBog2 wrote:

The SPV is no big deal, it is just another shell layer in the structure. What scares me is that we are again delaying the launch of NAMA and the unclarity remains as murky as months ago.

“urban and land planning”, and “social housing and community development” are just two of the fourteen sectors from which NAMA board applicants should have experience.

I ‘ll use Gunter’s phrase – ‘this is more smoke and mirrors’ – minds already are decided and “the right people” already chosen. It is just a way for the politicos being able to say “I was fair and open on the manner in which the NAMA appointments were made.”

K

KB as you may have observed I’ve always taken a sunnier view than that but if you are right it will be a missed opportunity that will not present itself again on this scale. A strong NAMA will require a multi-disciplinary approach that represents all areas of the built environment and investment community. Clearly the buyers and lessee’s will have all of the power for the foreseable future; to think that Zoe type apartments or Georges Dock type commercial architecture will hack it going forward would be a huge miscalculation.

If the product is better then the land price will form a much smaller percentage of the price enabling NAMA to acheive better returns if prices rise. The future will be much smaller projects which will only acheive profitability if they are of a sufficient quality; if the main property player is run by exclusively by bond fund managers and bankers then NAMA will come to a very bad end.

@PVC King wrote:

KB as you may have observed I’ve always taken a sunnier view than that but if you are right it will be a missed opportunity that will not present itself again on this scale. A strong NAMA will require a multi-disciplinary approach that represents all areas of the built environment and investment community. Clearly the buyers and lessee’s will have all of the power for the foreseable future; to think that Zoe type apartments or Georges Dock type commercial architecture will hack it going forward would be a huge miscalculation.

If the product is better then the land price will form a much smaller percentage of the price enabling NAMA to acheive better returns if prices rise. The future will be much smaller projects which will only acheive profitability if they are of a sufficient quality; if the main property player is run by exclusively by bond fund managers and bankers then NAMA will come to a very bad end.

Yes, PVC, you views are sunnier, but then my pension fund is almost gone and my income is a fraction of what it was, thus it is hard to remain uncynical, yet alone cheerful!

I do not want to go over old ground again, but I’ve long ago spoken about the rise in insolvencies and the site cost/land price being too high an input into the overall equation. Nama is here to stay, so it has to be made work and I agree that it needs people with a commercial outlook. Don’t hold your breath. We will see more political latchico appointees and gobshite civil servants way out beyond their depth.

What really kills me is the total lack of any
– Awareness in the population that it was partly to blame
– Credible Opposition
– Professional financial journalists
– Knowledgeable Radio/TV presenters
– Economists who are more interested in problem resolution that making a name for themselves.
– Expeditious corporate enforcement.

The FG notion of a “Good Bank” is nonsense, Bruton is a nice guy, but is not capable of being a finance minister. George bloody Lee has never achieved anything except to pontificate on the TV- he even had to repeat his Leaving to get into college. Nobody can / will lend until the financial health of industries is known. That is a Black Hole at the moment because no lender can calculate the worth of the”receivables” on a balance sheet. The dominos will start to fall when NAMA gets going and then we will see who has been bathing in the nude. That must happen before there can be more liquidity in the market.

Some time ago I spoke here about the need for the construction industry to look overseas – Parlon has been waffling on about this recently, talking about the need for “export credit”. So far, nobody has had the knowledge, cop, or basic wit to query him on what he means by this. What he really wants is financial guarantees from the State in the form of performance bonds. Given the “health” of our great names in construction, and their probable ability to complete a job, who would like to guarantee the performance of any one of them on an overseas project???

The only advantage this downturn has given me is more time out on the bog with the dog and gun. More sense out there. (Apart from the erudition here, of course:))

Rs
K.

don’t think the search function is working to well this came up 15th or something.
It’s nice not being able to print money…

I would take the 22k any day;)

http://www.irishtimes.com/newspaper/ireland/2010/0331/1224267401852.html?via=rel
http://www.irishtimes.com/newspaper/frontpage/2010/0331/1224267402017.html
http://www.irishtimes.com/newspaper/features/2010/0331/1224267397160.html?via=rel
http://www.irishtimes.com/newspaper/ireland/2010/0331/1224267401873.html?via=rel
http://www.irishtimes.com/newspaper/opinion/2010/0331/1224267399309.html?via=rel

Nama as enacted gives virtual control to the Minister for Finance; assuming that Cuffe has or can secure cabinet backing and that the EU Commission have no objections then there is nothing to prevent it from being established. Given the shelf life of the current government is about two years I can’t see them establishing anything that would exclude the ability of back bench TD’s going to their constituency saying that NAMA will fund development of the local commercial development and that a week after the election 3,000 jobs for locals only will be created!!!!. Planning may just get in the way of such campaigning; although ranking projects with planning as well as demand analysis as the major determinates would be very prudent.

That is certainly the context in which it was raised but as there are likely to be few estates demolished and that most of those estates are likely to the small number of semi built suburban scale estates tacked onto villages in the border counties, you would wonder why he raised the issue other than to fly a kite for a wider role for planners in the overall process.

The return to original land use is a major issue in the Mid West US from what I have read where large tracts of land had services put in waiting for phased development and that land funds are now buying them and returning them to agricultural and alternative fuel production uses.

Coincidentally I actually thought today about the Bullock prospect that Providence are working at the moment; my thoughts turned straight to Rambo and the damage he did in 1993 in the last major downturn; once you grant the prospect on soft terms the holder can do some very basic work and sit on it until the market turns the right way as was the case with the Corrib field; truth is we are well beyond peak oil and anyone who grants cheap licenses for all but a very shortly capped development period is commiting political suicide. Not having a go at providence as the backers have a great track record of supporting indigenous businesses that employed thousands of Irish residents over the years but you get one shot at natural resources and then you are hostage to people like Hugo Chavez or worse Iran.

I get the feeling that Nama are concentrating on the larger commercial assets at this point in time for example Parkway in Limerick which has got some juicy agreement for leases i.e. Primani and Tesco which have long stop dates which will expire if not acted upon. No doubt when the more modest loans transfer the ghost estates will be looked at; the one serious silver lining is that Bank of Scotland were the real frontier trail blazers when it came to funding 100 houses in Ballyshannon or other border county locations and they are not in Nama. That said LLOY is in my portfoilio and is making exceptional progress with its UK loan book; topping up my holding in late February was a very good move. The real problem in Irish banking was the entry of HBoS to Ireland and their aggressive grab for market share they made that resulted in 2.50% interest rates; thankfully they have no exited the market and as a result more sustainable margins now prevail which should to make sure that this doesn’t happen again.

Providence brings in Baltimore partner
Monday, 26 April 2010 10:23
Exploration company Providence Exploration says it has agreed a farm-out deal to advance its Baltimore heavy oil discovery, off the coast of Ireland.

UK independent oil and gas firm Nautical Petroleum will acquire a 40% interest in the licence in return for funding a development feasibility review. Providence retains the balancing 60%.

The deal for the site in the North Celtic Sea Basin is subject to approval from the Government.

Nautical is currently involved in a number of similar heavy oil field developments in the UK North Sea including the Kraken discovery and Mariner, which is operated by Statoil.

As requested – one oil find!!!!!
KB – The general view on Sir Anthony has been he invests when others won’t; he and his brother in law took some hit trying to save Waterford Wedgewood; anything but Crony capitalism or the firm would have been well naked before the downturn hit.

@KerryBog2 wrote:

The shareholders got nothing,

Those are the risks with equity investment; but the largest losses were suffered by the parties to you refer; it was far from a penny stock for a long time.

FORMER CELTIC TIGERS’ BORROWING COSTS HIT BY GREEK DEFAULT FEARS – The injustice of it all! As fears of a Greek default escalate, Ireland’s 10-year borrowing cost rose above 5% on Wednesday, a 2 percentage point premium over German Bunds. In its influential Lex column, the Financial Times says that Irish finance minister Brian Lenihan has led the way among ailing peripheral euro zone economies in taking the harsh fiscal measures needed to regain investor confidence. He set the example months ago that Athens should follow now, slashing public servants’ salaries, and welfare payments. Investors rewarded him: the yield spread over Bunds narrowed. Now Dublin has given up those gains as Greece, the European Commission and the International Monetary Fund fail to agree on similar draconian measures for Athens. Ireland is no saint, the column says. Like other peripheral economies it became uncompetitive, paying itself too much and producing too little. And unfettered bank lending and limp regulation during its property boom brought deep recession when the bubble burst. The 12.5% contraction in Ireland’s gross domestic product since the end of 2007 is the euro zone’s worst. Output could shrink 1.3% this year. Furthermore, Ireland’s budget deficit, at 14.3% of GDP, is higher than Greece’s. But Ireland is not in the same league as Greece: the former Celtic Tiger has a credible recovery plan and has bounced back before.

Unlike many sections of the UK media you can always depend on Lex to stick to the underlying numbers.

NAMA GIVES FIRST CASH TO DEVELOPERS – NAMA, the toxic loans agency, has extended its first-ever funding to the country’s developers as they struggle to finish projects around the country, says the Irish Independent. The agency declined to name the developers who received the capital or the amounts they received. “NAMA has provided small amounts of urgently needed working capital to support a number of projects to date,” said a statement from the agency. A number of developers are now expected to seek permission from NAMA to roll over huge debts in the next few weeks. NAMA said yesterday it would decide on these when staff review the business plans of the developers. It is likely that major developers will now be forced to sell unprofitable or underperforming assets, following a review of their business plans. While NAMA is anxious to avoid a fire-sale of development land, trophy assets which are in the red are under scrutiny. Some of the top 10 developers have had business plans sent back because they are not judged to be realistic enough. However a number of plans are still outstanding. They disclose huge indebtedness and extensive breaches of loan covenants.

Watch this space going forward, one hopes to see a firm hand and a disciplined and patient investment approach.

Are you not going to break down the figures between; Domestic banks, Government, Consumer, secured on PPR, foreign direct investors and non-dom funds?

NAMA warning for ‘extravagant’ borrowers
Wednesday, 5 May 2010 13:23

The chairman of the National Asset Management Agency has warned that no borrower is too big to fail.

Speaking to the Chartered Accountants Leinster Society, Frank Daly, said many borrowers had not yet abandoned the extravagant mindset of the 2003 to 2007 era.

By now, NAMA has held face-to-face meetings with the top ten developers or their representatives. These are being asked to submit detailed business plans to the agency soon. Mr Daly said NAMA would approach these plans with a sense of realism – about property over-supply, prices and the prospective demand for developments.

AdvertisementNAMA has almost completed the transfer of the first batch of loans from the banks. The discount on these loans will be 51%.

The NAMA chairman today said there were a large number of borrowers who owed between €5m and 420m who were not professional property developers.

‘It is very difficult to understand how borrowers on relatively modest incomes could have been advanced large sums of money to invest in undeveloped sites in unpromising locations,’ he said. Mr Daly added that there were questions to be asked about the way banks were run in allowing this type of lending to take place.

Mr Daly also raised big questions about Ireland’s planning process in the past. He asked how many shopping centres or apartment developments could a medium-sized town accommodate?

He also said one of the more baffling features of the boom was that banks seemed oblivious to other lenders who were financing similar developments in the same area.

Mr Daly also defended the cost of professional services used by NAMA, describing it as ‘low’ and adding that the cost of these services would be recouped from the banks.

Any thoughts?