Although we call it the National Asset Management Agency, NAMA is in fact dealing with loans where almost a third are in respect of property outside the State. Indeed NAMA is not even an asset management organisation, at least not in the early days where it will be a loan manager – only when loans go bad and foreclosure follows (in what NAMA “prudently” estimated in its October 2009 draft business plan would happen in 20% of cases), only then will NAMA become an asset manager. And lastly it’s arguably not even an agency – it is not subject to the State’s Freedom of Information Act and our Minister for Finance, Brian Lenihan, is forever telling us NAMA is an independent body.
It is the first of these though which NAMA should especially consider in its dealings with governments and people outside the State. As this story in the London Times demonstrates (and look at some of the comments), there is the potential to have NAMA seen as a gang of Irish bankrupting locals, demolishing their property and undermining their property markets through firesales or hoarding. NAMA is lucky to have Brendan McDonagh as its CEO because he comes across as a decent, non-presumptuous, hardworker doing his job with neither airs nor graces – he is also a clear communicator. Of course NAMA will employ third parties in local markets and indeed may have local advisory boards. It is important that NAMA understands the importance of clear communication of its objectives and puts in place plans to deal with the suspicions and sensibilities of locals. If it doesn’t, it risks exposing itself to difficulties in a range of areas including planning decisions, finding investment partners and disposing of assets not to mention hostile judicial reviews and competition-related challenges.