Nama expects to hand over its €4bn lifetime surplus to the State by 2021
Agency raises surplus guidance from €3.5bn as it announces 65% rise in after-tax profits
Nama said it generated €3.27 billion in cash in 2018, of which €3.14 billion was from the sale of loans and properties
The National Asset Management Agency (Nama) expects to hand over its likely €4 billion surplus to the State in 2020 and 2021.
The agency, set up a decade ago to take over Irish banks’ property loans following the crash, predicted on Thursday that it would earn a €4 billion surplus for the State after clearing its remaining liabilities.
Outgoing chairman, Frank Daly, confirmed that Nama would transfer the first €2 billion of this to the Exchequer in 2020 and the remaining €2 billion the following year.
Mr Daly explained that the agency had to repay its remaining €1 billion in debt and approximately €56 million to private equity investors before it can pay the State its dividend.
The projected €4 billion surplus exceeds the €3.5 billion that the agency calculated in January that it would make.
The Minister for Finance, Paschal Donohoe, welcomed the news, pointing out that €4 billion would play “a really valuable role” in the State’s finances.
Nama reported an after-tax profit of €785 million for 2018, its eighth consecutive year of profitability, and a 65 per cent increase versus the previous year.
The agency said it generated €3.27 billion in cash in 2018, of which €3.14 billion was from the sale of loans and properties. This compares with €3.27 billion generated in the prior year, of which €2.43 came from sales.
Total cash generated from 2010 to end-2018 was almost €44 billion, including €37.8 billion from asset disposals.
Nama said that having completed the redemption of its €30.2 billion senior debt in three years ahead of schedule in 2017, it had used its strong cash generation to begin redeeming its €1.6 billion subordinated debt last year. In total, €529 million of debt was redeemed over the 12 months.
The agency’s €32 billion deleveraging programme was 94 per cent complete at the end of 2018, with the carrying value of debtor loans falling to €1.9 billion.
Nama reported major progress in delivery or residential properties with 14,000 homes delivered or facilitated between the start of 2014 and the end of last month. Of these, 10,000 were Nama-funded with another 3,200 were under construction or approved for funding.
It said that 100 per cent of the agency’s interest in the Dockland’s SDZ which covers 4.2 million square feet of commercial space and 2,200 units are now either under construction, have been completed, or have been sold with the benefit of planning permission.
“2018 saw another excellent financial performance from Nama, as we made a significant profit for the eighth year in a row and increased our projected lifetime surplus to €4 billion, subject to market conditions,” said chief executive Brendan McDonagh.
“On top of this Nama expects that it will have paid taxes to the exchequer in the region of €400 million, bringing its overall contribution to a projected €4.4 billion,” he added.