The National Asset Management Agency (Nama) was set up to help rescue the banks by taking the bad loans they had made for land and property development off their books, thereby enabling the banks to start lending again. After three years in operation Nama can report some significant progress. The State agency, according to an end-of-year statement, is on course to achieve a profit by 2020, when it expects to complete its work and close down.
By then Nama hopes to have recovered more than the €31.8 billion that it has paid to buy – at a substantial discount – the toxic property loan portfolios of various banks. How substantial a profit Nama may ultimately achieve will be determined by how the property market performs in the meantime. Nama chairman Frank Daly, however, points to some encouraging signs that the commercial and residential property markets are stabilising.
Nama is a dominating presence in the Irish property market, and has become a major player in the European property scene. Since 2010 the State agency has taken in some €7 billion, arising from sales of property by those with Nama loans, and received a further €3.6 billion in rent receipts. But achieving a substantial profit on Nama’s operations by 2020 will, however, do little to offset the loan losses incurred by the banks – borne by taxpayers and shareholders – that have proved so damaging to the economy.
Social housing is one area where Nama has greatly improved its performance, and acknowledged its broader social responsibilities. It has identified some 3,900 residential properties that may prove suitable for that purpose, and so help reduce the long waiting list for social housing. Local authorities, however, decide on what is suitable. And to date just 38 per cent of the properties that Nama has offered are regarded as acceptable. That is less a reflection on Nama, and perhaps more a measure of the Department of the Environment’s reluctance to acquire more of the homes that the State agency has offered.