Belfast Telegraph

Wednesday 16 April 2014

Republic's bad bank has some good news

When the National Asset Management Agency first arrived on the battlefield that was the Irish and Northern Irish property market on the island of Ireland it didn't get a warm reception.

In fact, it still doesn't get a very warm reception given it's associated with managing the worst property loans both sides of the border.

Its debtors have tended to quiver at its mention and the rest of the property market are living in fear that Nama will turn up tomorrow and sell all of the 4% of its total assets which it manages here.

But things seem to be changing. On a visit to Northern Ireland yesterday the top dogs at Nama repeated the oft-uttered line that they have no intention of initiating a fire sale in Northern Ireland nor anywhere else.

It has already got rid of its most critically ill loans and, according to chairman Frank Daly, it has a much better idea of the quality of the rest of the property on its books, which he believes is better than they first thought.

Not only that but they're keen to push loans to debtors and investors who come up with good business plans to add value to their property.

Of course, Nama's not going to pour good money after bad and lend money for any old project but there's no doubt that it, and therefore the property market, isn't in quite as bad a way as it once was. That phrase is obviously avoiding any positivity because nobody can be sure where property prices are headed next but there is certainly some succour to be taken from the fact the agency in charge of our most toxic loans is in a healthier state.

In fact, Nama is at pains to point out that it is far from a 'toxic' bank now given the fact it has sieved through its assets and is left with loans which at least have some potential.

It says the EU troika which checks up on how the Republic's economy is coping with paying back its bailout money now views Nama as an asset itself and one which adds to the feeling that the country is coping better than other bailed out European nations.

So for now, two-and-a-half years since it took ownership of nearly €32bn (£26bn) of property loans, Nama's progress can be summed up as better than expected.

Let's hope the next seven-and-a-half years follow suit.