Belfast Telegraph

Toxic loan 'chaos' is averted by NAMA

By Sarah Arnott

Finance Minister Sammy Wilson said the management of Northern Ireland property loans held in Irish banks could have resulted in "catastrophe" without NAMA.

Mr Wilson spoke following a meeting with Frank Daly, the chairman of the Republic's 'bad bank' and members of a committee set up to advise on the bank's work in Northern Ireland.

The Department of Finance and Personnel said it was the first of regular meetings between the minister and the Northern Ireland Advisory Committee.

NAMA has just swallowed the second tranche of toxic asset loans into its coffers worth £9.7bn (€11.9bn) - of which £291m (€460m) relate to Northern Ireland.

Mr Wilson said Northern Ireland involvement in the transfer process would "increase rapidly" between now and the end of the year. "Ultimately loans with a nominal value of approximately €5bn will transfer from Northern Ireland and the role of the Northern Ireland Committee will become increasingly important."

He said NAMA had reassured him there would be no firesale of assets in Northern Ireland but that they would be "carefully managed" in the medium term.

" I agreed to ensure that there is co-ordination of activities and avoid flooding the local market with land sales, and that we should examine how this close co-operation could be extended to the ongoing work of the banks."

"Without NAMA we might have had a catastrophe. With NAMA we have the opportunity to manage our way through the process," said Mr Wilson.

"The first two tranches of loans transferring to NAMA have totalled some £21.7m (€27bn) with banks receiving approximately £10.5m (€13bn) of securities.

"To this extent, money is flowing again and banks must make sure that this money in turn flows to businesses and generates economic recovery."

The second transfer of loans this week left NAMA in control of 35 hotels.

But the Department of Finance and Personnel said it could not confirm whether those hotels were located in Northern Ireland.

NAMA's statistics do not provide details of assets relating to loans in Northern Ireland.