Anglo delay as other institutions transfer second tranche

THE NATIONAL Asset Management Agency has completed the transfer of the second tranche of loans from four of the five participating financial institutions, buying loans of €5.2 billion at an average discount of 48 per cent.

The agency has yet to complete the transfer of almost €8 billion in loans it has estimated it will acquire in the second tranche of loans from State-owned Anglo Irish Bank.

The second tranche relates to land and development loans owing by the 23 borrowers below the 10 biggest development customers.

Nama said Anglo’s loans would be acquired “over the coming weeks after all necessary due diligence material has been received and evaluated”. An Anglo spokeswoman declined to comment on the reasons for the delay.

It is believed that the volume of Anglo’s loans in the second tranche – about €5.2 billion more than the next largest (AIB with €2.73 billion) – and the length of the due diligence on the loans is the reason behind the delay.

Irish Nationwide Building Society was hit with the biggest discount in the second tranche of loans, receiving €163 million in Nama bonds for loans of €591 million, representing a discount of 72 per cent – well in excess of its 58 per cent haircut in the first tranche.

Bank of Ireland sold €1.82 billion in loans at a discount of 37.8 per cent – higher than its first tranche haircut of 35 per cent, while EBS sold €35.9 million in loans at a discount of 46 per cent, above the 37 per cent discount applied in the first loan transfers.

AIB took a haircut of 48.5 per cent on the €2.73 billion transferred, compared to 42 per cent on the first tranche.

The agency said the discounts applied in the second wave represented an average weighted discount of 48 per cent for the four lenders. To date, the agency has acquired €20.5 billion in loans with €10.4 billion of Nama bonds.

The agency must acquire the remaining €60.5 billion in loans earmarked for transfer to Nama by February 2011, a deadline set by the European Commission.