Nama criticised over sale of loans linked to Quinlan Private

Sale of portfolio could have cost State up to €29m, spending watchdog report suggests

The report by the Comptroller and Auditor General Seamus McCarthy says the target price for the loans should have been €29 million higher but for Nama’s errors. Photograph: Cyril Byrne/The Irish Times

The State’s spending watchdog has criticised Nama over its handling of the sale of a tranche of loans linked to Quinlan Private, the property investment group that was run by financier and one-time tax official Derek Quinlan. Seamus McCarthy, the Comptroller and Auditor General, suggested the agency’s mistakes may have cost the State up to €29 million.

Mr McCarthy said “errors and poor analysis” by Nama led to the Project Nantes portfolio being sold at less than half of what its target price should have been. The portfolio included property loans and also personal borrowings of directors linked to Mr Quinlan’s group.

It was sold in 2012 off-market at a steep discount for almost €27 million to Californian private equity group Clairvue Capital. Nama made a loss on the price it paid of more than €10 million.

When Nama sold the portfolio, it was unaware that Mark Donnelly, a director of Avestus Capital, which took over Quinlan Private in 2010 and was managing the loans, was also a director of the Luxembourg unit of Clairvue that made the purchase.


Mr McCarthy’s report says the target price should have been €29 million higher but for Nama’s errors, which included a failure to properly value the assets. It also didn’t put them on the open market to test their value.

There is no basis to conclude that Nama achieved the best financial outturn from the Project Nantes loan sale

He concludes there is no evidence that Nama would have achieved the higher target price on the open market. But he suggests that this is because the loans’ true market value at the time cannot now be determined.

The watchdog’s report concludes that “errors and poor analysis by Nama meant that the residual target of proceeds for the Project Nantes loans was significantly lower” than it should have been.


“Securing independent current asset valuations prior to any disposal, along with a competitive marketing process, are the normal strategies for ensuring financial returns are maximised,” he says in the report.

“In the case of Project Nantes, Nama did not seek current valuations of the loans or of the underlying property collateral, and did not pursue a competitive sales process. There is no basis to conclude that Nama achieved the best possible financial outturn from the Project Nantes loan sale.”

Former Independent TD Mick Wallace, now an MEP in Brussels, first raised the issue of the Project Nantes sale in the Dáil in 2018. He claimed the sale of the loans was illegal due to Mr Donnelly's involvement.

The former TD alleged this breached provisions of the legislation underpinning Nama that is meant to prevent developers, or anyone connected to them, from buying back their own assets at discounts from the State.

How many more loan portfolios did Nama sell during 2012, 2013, 2014 without valuing assets?

The report concluded that the relevant provisions only prevent the sale of properties, and not the sale of loans. Therefore, Mr McCarthy says, it was not illegal. It is clear from his report, however, that Nama did not know of Mr Donnelly’s involvement.

Nama responded by highlighting the sections of the report that said there was no legal breach and no guarantee the higher target price would have been achieved.

Speaking from Brussels, Mr Wallace said the the performance of Nama “beggars belief”.

“How many more loan portfolios did Nama sell during 2012, 2013, 2014 without valuing assets or bringing them to market?” he said. He called on the Government to launch a “complete review” of all Nama loan sales in the period.

Mark Paul

Mark Paul

Mark Paul is London Correspondent for The Irish Times