Is NAMA providing confidential information to Government politicians?

As expected, Senator Mark Daly’s bill to promote transparency at NAMA and IBRC languishes somewhere in Leinster House gathering dust, but that didn’t stop the Kerry senator and auctioneer from trying to promote the bill in the Seanad last week when he used the report of the sale of 450-acres of land adjacent to Cork city as a case-in-point to support the need for a transparent register of NAMA-controlled property for sale and sales. The Senator told the Seanad last Wednesday 2nd May (emphasis mine)

“Will the Leader allow time for a discussion on the NAMA and Irish Bank Resolution Corporation Transparency Bill 2011 which my colleagues and I have published? This Bill allows the public to see the properties that NAMA is selling. Last week a property that was never on the market, but which was bought for €100 million, was sold for €7 million. Nobody in the area knew it was for sale and then it was gone. Under the legislation NAMA must sell all State assets under its control. Loans are State assets and NAMA is a State body and must sell them in an open and transparent manner in accordance with the sale of public goods, whether by tender or public auction. That is what NAMA is supposed to do, but it is not doing it. We, as Senator Coghlan who is a former auctioneer would know, are losing millions of euro as a result of a lack of transparency”

 

The Senator was presumably referring to this sale of a Castlelands Construction land-bank that had been assembled at a cost estimated at €100m but sold, reportedly to a local farmer, for €7m without the property ever having been advertised on the open market.

The Government chief whip in the Seanad, Senator Paul Coghlan – like Senator Daly an auctioneer, also hailing from Kerry – responded with “Tomorrow morning I will return to the issue of NAMA”

 

And true to his word, the very next day, Senator Coghlan was seemingly well-prepared on the detail of the sale when he told the Seanad

“I am rebutting something that was stated seriously in this Chamber yesterday. I put on record that two independent valuations of approximately €10,000 an acre were carried out by reputable firms in that regard. When NAMA acquired that loan, it reflected the state of the market at that time. It was sold in one lot at a price significantly above what the agency paid for it and consequently, a profit was made for the taxpayer.”

At which point Fianna Fail’s Senator Thomas Byrne interrupted with

“Members were not meant to know the details”

And Senator Byrne is quite right, what NAMA pays for a loan is supposed to be confidential and known to NAMA and the bank from which NAMA originally bought the loan. Not even the developer knows what was paid and is told by NAMA that the full par value of the loan remains outstanding. NAMA obviously doesn’t tell receivers or estate agents what it paid for the loan. In both cases, NAMA wants to maximise the sale price and the acquisition value should not be relevant to either receiver or estate agent. Senator Byrne’s interruption was ignored.

So how did Fine Gael’s chief whip in the Seanad find out what NAMA paid for the loans underpinning the 450-acre property in Cork? And although it’s not certain, it does seem that the Senator came by this information in the 24 hours between Senator Daly raising the subject and the response by Senator Coghlan.

NAMA?