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Project Eagle: We got the best deal possible, Nama chair insists

Published 14/09/2016

Nama Chairman Frank Daly defends the portfolio's losses.
Nama Chairman Frank Daly defends the portfolio's losses.

Nama has insisted it got the best price possible for its controversial Northern Ireland property portfolio.

Ireland's bad bank said the £1.3 billion sale to US investment fund Cerberus two years ago was "the best achievable result".

As an official report flagged concerns about a discount on the sale, Frank Daly, the toxic assets agency's chairman, said the so-called Project Eagle portfolio would not reach even near that price today.

"It is clear to us that, if Nama had retained the Eagle portfolio, there would be no investor interest in buying it today - or in the foreseeable future - at anything close to the £1.322bn price that was actually achieved," he said.

A report by Dublin's Comptroller and Auditor General (CA&G) found two of Nama's valuations of its Northern Ireland loans in late 2013 and early 2014 underestimated their value.

The spending watchdog said Nama's argument for a 10% discount on the property loans was "not persuasive", adding the bad bank's normal discount rate was 5.5%.

It has put Nama losses on deals linked to Northern Ireland properties, the vast majority from Project Eagle, at £162 million.

But Mr Daly categorically rejected the key findings and accused the CA&G of overstating the estimated value of the properties.

The watchdog incorrectly assumed a similar discount should have been applied to a "poor quality" Northern Ireland loan portfolio as to "much higher quality assets" in Dublin and London, he claimed.

"The C&AG has performed a very important role in scrutinising our decisions and auditing our accounts over the past seven years but, regrettably, the key conclusions in this report are without the relevant loan sale market expertise and as such we have no option but regretfully to reject them categorically," said Mr Daly.

He said four of the world's leading authorities on loan sales - KPMG, Eastdil Secured, Cushman & Wakefield and Lazard - backed the Nama position.

"There is nothing in the report that changes the unanimous view of the Nama board that the Project Eagle sale was the best achievable outcome for the State either back in 2014 or now in a post Brexit environment," he added.

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