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.