Yesterday Minister for Finance Michael Noonan issued a statement in which he stated that the sale of the 17% stake in NAMA held by Irish Life Investment Managers had “just been agreed” and the sale was to “private investors”. The Minister isn’t saying who the new “private investors” are, and yesterday all sorts of rumours spread naming everyone from Bord Gais to Goldman Sachs to Denis O’Brien. NAMA itself decline to issue a statement which is becoming par for the course for the Agency – remember it didn’t issue a statement when it handed over €3.1bn of its cash as a temporary dig-out on the Anglo promissory note either, yet in the past it has issued press releases for what counts as little more than the acquisition of a new pencil.
So, why all the mystery? After all, we will find out very shortly anyway because NAMA is a company incorporated under Irish company law and the Agency will need notify the Companies Registration Office (CRO) of any change to the identity of its shareholders. You can see the CRO-registered shareholders, before the current transaction, of National Asset Management Agency Investment Limited from thestory.ie here.
And of course the event which prompted the sale of Irish Life Investment Managers’ shareholding – the Government taking control of Irish Life and Permanent which owns 17% of NAMA which, when added to the Government’s existing 49% stake, would mean the Government had majority control of NAMA to the tune of 66% which would mean Eurostat classified NAMA’s €28bn-odd debt as Irish General Government Debt – has been known about for many months; yesterday Eurostat in a bluntly-worded caveat about Ireland’s debt figures stated “owing to the nationalisation of one of its previously private beneficial owners, whose interest is currently under a process of sale, NAMA-IL has been in majority public ownership since July 2011.”.
So if the Department of Finance has known about the issue for nine months – because Eurostat presumably told it, though you’d expect the mandarins to have the nous to have understood the issue before being externally alerted to it – and we will shortly find out from the CRO the identity of the new investors – note the plural, Minister Noonan didn’t refer to “a new investor” but to “new investors” – then why is Minister Noonan being so demure? Is it because the “private investors” have only agreed in principle to buy the investment from Irish Life Investment Managers and that perhaps the mystery buyers needs wider approval, perhaps from stockholders, before it can proceed? That didn’t stop Minister Noonan naming Bank of Ireland as the White Knight riding to the rescue of the Anglo promissory note jig in March 2012, but if it does turn out a buyer whose agreement to buy the NAMA stake is again subject to shareholder approval, it will be hard not to conclude that the Department of Finance is a most incompetent, fumbling and un-anticipating group of administrators.
So for now, we wait with bated breath.
NAMA Wine Lake 
QUOTE: “…it will be hard not to conclude that the Department of Finance is a most incompetent, fumbling and un-anticipating group of administrators.”
Is it any wonder when the culture there is for “…long-service increments are given when workers have been in their job for a certain number of years…” (yesterday’s Indo: http://www.independent.ie/national-news/pay-hikes-for-civil-servants-earning-more-than-70000-3088610.html)
You hang around long enough and eventually get money simply for hanging around long enough.
Performance? Don’t ask. Don’t tell.
Considering the amount of carnage off balance sheet vehicles and SPV’s created during this financial crisis, it’s a wonder that Eurostat gave it a wink and a nod in the first place.
“Veto” Latin for I forbid!!
“Under the shareholders’ agreement between NAMA and the private investors, NAMA exercises a veto over decisions taken by the company. Eurostat gave its approval to this structure in October 2009”
http://www.nama.ie/about-us/group-structures/
B of I released interm statement this morning,silent on NAMA,no additional info or light on Anglo bond deal.
@John, BoI did include a paragraph on the Anglo promissory note deal in this press release today
“Other Significant Item
On 29 March 2012, the Group, Irish Bank Resolution Corporation Limited (“IBRC”) and
the State, reached a conditional agreement to conduct a securities repurchase
transaction (“Repo”) whereby the Group would purchase long term Irish Government
Bonds (the “Bonds”) from IBRC for a purchase price of approximately €3.06bn in cash.
The Repo would be governed by a Global Master Repurchase Agreement which would
incorporate standard market terms including daily cash margining with respect to
changes in the value of the Bonds. The transaction would be financed by the Group,
through standard ECB money market operations using the Bonds which are Eurosystem
eligible. All IBRC’s payment obligations to the Group with respect to the Repo would be
covered by a guarantee from the Minister for Finance of IBRC’s exposures for
transactions of this nature. IBRC would have an obligation to repurchase the Bonds for
approximately €3.06bn not later than 364 days after the effective date of the
transaction. The transaction is considered to be a related party transaction under the
Listing Rules and consequently is subject to independent stockholder approval which
would involve the publication of a stockholder circular (containing all relevant details of
the transaction) and an Extraordinary General Court to approve the transaction in due
course.”
Click to access boi-interim-management-statement-24-04.pdf
Yes the Eurostat decision is curious but remember it is and remains a preliminary decision and there may be other considerations beyond ownership that Eurostat is presently considering…
http://www.asktheeu.org/en/request/national_asset_management_agency
@NWL had quick look at it ths morning too,nothing particularly noteworthy on the Anglo transaction other that reiterating the guarantee from Noonan!
Also,checked the “usual suspects” for press releases,stock exchange info.
The big I word is most likely focusing minds,what about the AIB piece,who actually “owns” it?
The goal posts do keep on moving,”Scenarios” like these scare the bejesus out of the quants at Eurostat,if their is any shortfall who will cover it,nationalized financial institutions,B of I ?
If the potential for a profit in the SPV is non existent,them some “other” consideration must be included/implied rendering it realistically a non market transaction.Has anyone ever invested 20 or so mil. for a small profit or break even projection,is the principal guaranteed or at risk ?
“Mr Noonan referred to recent analysis by Nama “which indicated the agency would repay all its senior bonds by the end of 2020, with a small surplus given one scenario and a relatively small loss given another scenario”. It was, he said, “predicting a break even under present circumstances”.
http://www.irishtimes.com/newspaper/ireland/2012/0419/1224314925973.html
@NWL just followed your link,great work liked the dig at Frank,rushing out it’s first thing over here,but looking forward to reading and reviewing,well done.
D of F issued a info. note subsequent to its initial press release yesterday,2 to 3 weeks before NAMA ‘investors’ revealed and………who said anything about Losses……
“A Eurostat 2009 special note on the financial crisis allows for the exclusion from general government debt and deficit statistics of a short-term new special purpose vehicle that is privately owned, is not expected to make losses…..”
Click to access infonotemaastrichtmar2012.pdf
@NWL your ‘link’ takes me a error page,then a home page,could they not have attached or linked the relevant doc.’s will sleuth around.Nice work.
@John, try copying the link into your browser. For some reason, some internet browsers sometimes have problems with links from WordPress-hosted blogs.
I am not going to speculate on the mystery, but I doubt that this is a coincidence, rather a well calculated political decision to hide the investor for as long as possible. They will have their reasons, and it is a funny thing with reasons, there are two kinds, good reasons, and real reasons!