Nama offers to buy back some of its riskiest debt

Agency will assess terms of offers before deciding how much, if any, to accept

Nama has asked subordinated debt holders to indicate terms at which they are prepared to sell at least some of their holdings. Photograph: Dave Meehan

Nama has asked subordinated debt holders to indicate terms at which they are prepared to sell at least some of their holdings. Photograph: Dave Meehan

 

The National Asset Management Agency (Nama) has offered to buy back as much as €1.6 billion of subordinated debt, due to be repaid in 2020, which was originally issued as part of the wider bailout of Ireland’s financial system.

Nama has asked subordinated debt holders to indicate terms at which they are prepared to sell at least some of their holdings, a spokesman for the agency said on Wednesday.

The agency will assess the terms that debtholders offer before deciding how much, if any, to accept, the spokesman said, adding it does not anticipate acquiring all of the outstanding debt at this point.

Senior bonds

Nama issued the securities along with about €30.2 billion in senior bonds while buying property loans from Irish banks during the financial crisis. The agency redeemed the last of the senior debt in October. It said at that time that it expected to redeem the subordinated debt by its first call date in March 2020.

Debtholders have until April 23rd to indicate the terms at which they would be willing to sell.

The process is being carried out as an unmodified reverse Dutch auction, an established market process for conducting transactions of this nature.

The agency is unlikely to be wound down before its 2020 scheduled date, Minister for Finance Paschal Donohoe said last month, as doing so could endanger Nama’s projected lifetime surplus of €3 billion.

– Bloomberg