NAMA – A financial scandal
£4.5 billion: the value of Northern Ireland’s property loans portfolio (Project Eagle) acquired by NAMA
70% the estimated haircut applied to the sale of Project Eagle
£1.3 billion paid by Cerberus for Project Eagle
33.5% the average haircut applied to the entire £77 billion NAMA portfolio
The recent revelations about Sinn Fein’s involvement in coaching the loyalist blogger Jamie Bryson prior to his evidence submission to the Finance Committee, investigating the Project Eagle sale, have put the largest financial deal ever to be done in Northern Ireland back into focus.
Chair of the Finance Committee, Daithí McKay, resigned from the Assembly just hours after it was revealed that he had engaged with Bryson prior to his submission to the inquiry. Another Sinn Féin party member, Thomas O’Hara, who McKay directed Bryson towards, was suspended following the revelations. The majority of the new Finance Committee, which was called to an emergency meeting on 23 August, have since called for Finance Minister, Máirtín Ó Muilleoir, to step aside until a full investigation has been completed but he is standing firm in denying any knowledge of the interaction.
The revelations have caused political waves, with some commentators even suggesting that it threatens the working relationship of the two Executive parties, Sinn Féin and the DUP. It’s hard to believe that McKay saga could bring down Stormont, considering that it is essentially a side-show to the bigger story. That story being alleged corruption, the probe into which is still ongoing, slowly.
That probe is multi-faced. Both the Irish and Stormont Governments plan to publish internal reports on the sale of NAMA’s Northern Ireland property portfolio but the onus largely lies with the National Crime Agency, who are leading the investigation and possess the powers of arrest.
NAMA was set up in 2009 following Ireland’s banking crisis to prevent the flooding of the market with stressed assets. The aim was that assets would be managed until market recovery would allow for the assets to be maximised in the interests of the taxpayer. However, the ‘fire sale’ method, with which some assets have been sold has led to criticism and the eventual revelations around Project Eagle. The Project Eagle portfolio included around 850 properties and development land, mostly in Northern Ireland estimated to the value of £4.5 million. However, the portfolio was purchased by New York investment firm Cerberus in 2013 for just £1.3 billion, an estimated haircut (discount level) of around 70 per cent. That haircut is more than double the estimated haircut for the bad bank loans in the Republic of around 33 per cent, a figure which has caused wide-spread anger.
The TD Mick Wallace was one of those who voiced his concern at the level of discount the assets were being sold off at and in doing so alleged that Belfast law-firm Tughans had £7 million in a bank account reportedly earmarked for a Northern Irish politician. Bryson’s evidence to the Stormont committee, who launched an inquiry following the initial allegations, suggested that there were up to five people set to receive payment on completion of the sale of Project Eagle. One of those named was the then First Minister Peter Robinson, who has denied the allegations.
The investigation into alleged NAMA scandal appeared to have slowed down in the second half of the year but the recent revelations have put it back into the public consciousness, hopefully speeding up the process of providing answers as to who benefited from a loss of over £3 billion in asset value.
