Nama must crack its curate's egg problem
A s the year ended, the Republic's toxic loans agency Nama was suffering something of an identity crisis. The agency headed by Brendan McDonagh and Frank Daly knows what it isn't.
Peter Stewart, the head of Nama's advisory committee in Northern Ireland, estimated that £3.35m of loans on assets here would be acquired up by the agency.
At various times during 2010, chief executive McDonagh and chairman Daly said Nama isn't a "liquidation vehicle", isn't a "bad bank" and certainly isn't a "bailout for developers or the banks".
Officially it is an asset management company but this somewhat hazy and neutral description sits uncomfortably with the public, the political establishment and with Irish business.
What all three groups want to know is this - is Nama ultimately a good thing? Is it going to produce a profit for the taxpayer? Is it actually helping to solve the bank's liquidity and solvency problems or making them more acute?
For others Nama is a vehicle for vengeance, the body that should punish reckless and leveraged developers in ways the banks have failed to do since the onset of the credit crisis. This group accept that Nama has stepped in to the shoes of the banks - they just wish the agency was wearing steel-capped boots rather than brogues.
So how has Nama's first year gone? Well, the agency is up and running, it has most of the staff it needs in place, it has secured funding, it has seen off a legal challenge in the High Court from Belfast-born developer Paddy McKillen and crucially it has taken over the ownership of €71bn (£60.3bn) of loans - removing their toxic effect from bank balance sheets. These are considerable achievements. The overwhelming legal defeat administered to McKillen was a major victory for the agency, even though virtually nobody in Irish business ever thought McKillen was going to win his case (the Supreme Court is considering an appeal).
To take over €71bn of loans from the banks while only incurring one legal challenge was one of the satisfactory outcomes to the year for Nama. Two years ago Sean Dunne was among a group of developers reported to be considering challenging Nama's powers. In the end the developers were compliant in the face of Nama and never raised any legal objection, McKillen aside.
The banks have also benefited. They have exchanged €71bn of highly dubious and illiquid property loans for Irish government Nama bonds which have been eligible as collateral at the ECB. This has in some respects kept the banks alive.
The liquidity benefits of Nama are unarguable, but the other part of Nama - the valuations of the assets - is where a review of its role becomes more contentious.