“NAMA and IBRC are actively engaged in reducing their respective portfolio of debts and debtors. They are not in direct competition with each other for customers and resources. The board of NAMA and the IBRC actively monitor all cost headings and are driving efficiencies and substantial savings through their procurement processes. Due to funding and operational considerations it is not considered appropriate to merge the two agencies at this time” Minister for Finance Michael Noonan responding to a parliamentary question on 18th September 2012
The IBRC top team turned up before an Oireachtas committee this morning and the headline might be that current estimate that the ultimate cost of Anglo Irish Bank will “only” be €25bn but that is in the range that has been understood for over two years – examples here and here. Mike Aynsley and Alan Dukes have said on numerous occasions in the past, as has Minister for Finance Michael Noonan, that the ultimate cost of Anglo will be €25-28bn, so a €25bn estimate today is hardly news though it is welcomed that it is at the lower end of the range previously provided. Alas, we received little information during the hearing which might validate the forecast, though we do know the eventual outturn will depend on the performance of the economy and property markets in particular.
But the IBRC team did complain that staff were being poached by state agencies and others. This is an issue for IBRC as it sets salary levels. Although not specifically referred to, NAMA is in the same business as IBRC and is a state agency. But Minister Noonan said in response to a parliamentary question from the Sinn Fein finance spokesperson Pearse Doherty on 18th September that there was no competition between IBRC and NAMA for “customers and resources”. This wasn’t credible on 18th September 2012 and indicates Minister Noonan doesn’t understand the work of NAMA or IBRC. Merging NAMA and IBRC through the issuance of more NAMA bonds would save this State well over €100m operating costs per annum, would improve performance of NAMA and IBRC through avoiding dysfunctional competition and by having one agency across all loans to the same debtor at both agencies.
The full parliamentary question from Deputy Doherty was
Deputy Pearse Doherty : asked the Minister for Finance the consideration that has been given to the merger of the National Asset Management Agency with the Irish Bank Resolution Corporation; and the scope for reducing competition between the two State owned entities for resources and customers, and potential savings to the combined annual operating costs of €400-500million.
Minister for Finance, Michael Noonan: NAMA and IBRC are actively engaged in reducing their respective portfolio of debts and debtors. They are not in direct competition with each other for customers and resources. The board of NAMA and the IBRC actively monitor all cost headings and are driving efficiencies and substantial savings through their procurement processes. Due to funding and operational considerations it is not considered appropriate to merge the two agencies at this time.
That is a very wise suggestion – but likely to be blocked by the vested interests in the two agencies.
@NWL
The people on the boards and top management will earn enough in the next 8 years to make themselves very wealthy individuals. They have no intention of sacrificing that.
And just watch for the final payoffs / redundancy deals.
This is mé fein and vested interest country.