The jury is still out on here as to the wisdom of Minister for Finance, Michael Noonan setting up a NAMA advisory board which is chaired by career-banker, Michael Geoghegan and also includes Denis Rooney and NAMA’s own chairman, Frank Daly. The terms of reference for the board are pretty light, but that may change in future, and the board was seen on here as a political encroachment on NAMA’s freedom to pursue its objectives set down in the NAMA Act. The Department of Finance already has a staff of 700 and you would have thought it might have been able to muster the skills to properly advise the Minister. Seemingly not. But whilst NAMA continues to attract intense scrutiny of its operations – oftentimes repelled, it should be said by the opaque agency which oftentimes, and with justification, uses the NAMA Act which mandates confidentiality, as a shield – IBRC which is very similar to NAMA, see below, continues to operate largely beneath the radar.
The current drama at Siteserv has shone a light into the usually covert activity of IBRC and most of the country seems bewildered by the apparent decision of IBRC to write off €110m from a €150m loan whilst allowing Siteserv’s shareholders to walk away with €5m. We were also interested to find out that IBRC has been allowing €400k+ salaries at Siteserv, despite the fact that the offer prices for the company – €45-60m – suggest it is deeply insolvent. But how many Siteserv’s are there out there where IBRC is seemingly playing fast and loose with our money? Step forward TV3! In February, 2012 we learned from the Independent that IBRC had indefinitely “parked” an €80m loan to Doughty Hanson which controls TV3, pending a possible future sale of Ireland’s only commercial TV channel. In addition to the “parking”, no interest charges are being run up and Doughty Hanson itself is said to be in rude financial health. As an aside, it will be gas if, some night, someone self-righteously harangues Vincent Browne about the greed, speculation and stupidity of his employer! But why did IBRC offer a measure of debt forgiveness to TV3 when its parent seemingly has the resources to pay back the loan? And what about our national bete noire, Denis O’Brien? There has been reporting which suggests that he owes IBRC hundreds of millions of euro, and might in fact be IBRC’s biggest single exposure.
Somehow I would trust the NAMA CEO, Brendan McDonagh to pursue the interests of this State more than IBRC’s CEO Mike Aynsley, and ditto NAMA’s chairman Frank Daly ahead of IBRC’s chairman, Alan Dukes. Arguably Mike Aynsley is no longer fit for purpose – when he was originally appointed in late 2009, it was with the expectation that Anglo would be developed into a standalone bank, but as we now know, it is to be wound down, it doesn’t take on new business, hasn’t a branch network and its minimal deposits are kept because they are associated with legacy lending.
Given the similarities between NAMA and IBRC, you might ask why the Minister doesn’t feel the need to appoint an IBRC advisory board. But at this stage, given we own IBRC 100% and for all intents and purposes we own NAMA 100%, and given that both are dealing with generally distressed loans centred on property, given that both are supposed to wind down by 2020 and given that both are funded by state guaranteed funding – NAMA bonds and IBRC promissory notes – why not merge NAMA and IBRC together, generate savings from economies of scale and know-how and take the best from both organisations? And perhaps develop and apply the same standards of accountability and transparency to a merged entity.
NAMA Wine Lake 
I would also trust Nama far ahead of IBRC (ex-Anglo).
@Brian,
John F Kennedy once said: “To state the facts frankly is not to despair the future nor indict the past. The prudent heir takes careful inventory of his legacies and gives a faithful accounting to those whom he owes an obligation of trust.”
I’d like to see some “faithful accounting” – which we are not getting – before I would place any trust in NAMA.
“In the Country of the Blind the One-Eyed Man is King”
I agree,merge it into NAMA.
http://en.wikipedia.org/wiki/The_Country_of_the_Blind
Looking at the Siteserv balance sheet one can see how in a restructuring senario IBRC may receive less than the €40M currently reported when a liquidation analysis is calculated (I estimate €35M-50M), the nature of the assets owned would probably obtain 20% of the book value – and that future earnings might be compromised in a formal restructuring. Given the current management pulled together the hotchpot of companies that make up siteserv one can see rationnale for keeping them on as from a negotiating position they do hold a large number of shares and know better than most how to generate some value from the mix of companies owned (assuming current difficulties due to collapse in domestic economy) – it is not clear whether this is an up front payment or if some kind of earnout? Perhaps not so strange at all but indicative of destruction of value in a company heavily dependent on the domestic economy in the current market. An EBITDA multiple of 8 gets you to €124M, below the net debt of €145M which shows how much equity vaue destroyed.
Which makes it even stranger that a third world cell phone operator, based in Portgual wants it !
@JG; Lucrative government or semi-state contracts?
@ WSTT given the notorious history with government contracts that the buyer has…
Correction,the acquiring vehicle is based in the tax haven Isle of Man,far from prying eyes,and inquisitive minds!
One wonders,if there is any ‘good guy’ clauses involved in the contracts,it refers to the behaviour of the owners.
Here’s that grinning fool,Chairman of The Board at Siteserv and Enterprise Ireland,and NTMA advisory board member,embarrassing himself in the FT.He’s also lists amongst his very few and limited attributes,something called consultant to KPMG.Hold on they were “advising” on this sale too and getting
paid handsomely I assume.Release the fee information Cooney,you have a
clear conflict here.
Does Cooney,get some of the swag from the LARGE that KPMG,I’m sure is charging,after all he is a consultant there.Talk about getting it both ways.
http://www.enterprise-ireland.com/en/About-Us/Our-People/Board/Hugh-Cooney.html
Given,that this Siteseve fisaco,has again damaged Ireland’s international reputation,with the FT using words like “crony capitalism”.
Are advisory boards with members like Hugh Cooney,such a good idea.
His comments on price are total bullshit,there were higher offers,and it’s NOT UNUSAL,for Cox to play both sides,maybe in crap improvised third world countries.Hold on that’s the implication,in the FT no wonder O’Brien is back.
“Hugh Cooney, Siteserv chairman, told shareholders on Thursday the senior management team were in no way aligned with any of the parties involved in the sale process.
“In relation to Mr O’Brien, his offer represented the best offer in terms of price and conditions. We were in no way influenced, positively or negatively, by the identity of the purchaser,” he said.
Asked about Arthurs Cox’s appointment as legal adviser to Siteserv and Millington regarding the deal, Mr Cooney said this was “not totally unusual” and the board was satisfied by assurances provided by the law firm that there was no conflict of interest.”
http://www.ft.com/cms/s/0/65ea45ec-7f2a-11e1-a26e-00144feab49a.html#axzz1rgA8oQI9
Of note here is the fact that Denis O’Brien has a large shareholding in, and may end up controlling Independnet News and Media. So in effect we have IBRC showing great forebearance towards two media related loans.
My own suspicion is that the Irish banks have probably been doing a lot of deals with Irish media outlets, owners, and related personages over the last few years. People and companies in the media business have probably been kept sweet with favourable treatments, loans, writedowns and rollovers, instead turned sour by debt collection letters.
With all the recession related cutbacks, it may seem surprising to think that no newspaper has yet gone bust. But this only surprising if you ignore just how timid newspaper and TV coverage of banking scandels has really been. The government is playing the same game via IBRC, no doubt.
I for one would be very interested in seeing just who has gotten their debts forgiven over the last four years.
The Tribune went bust