Now many of them seem rather unwell, they have grey hair and are rather pudgy. They are probably further from the truth today than they were when they started 13 years ago. The only solace we can take from all the feckless flittering away of our money is that the greedy ones did not realise that they were also wasting their own careers dragging out (teasing out) the various modules as if the rest of us were living on another planet. They probably invested the ill gotten gains in property and bank shares hence the need for the new gravy train. After the scoping I am sure there will be plenty of time for a bit of scooping. Don’t you just love the way our ruling classes come up with these elegant new words to make the whole process seem rather painless.

Will NaMa go after this money? How will it know whose it is?

It is a tribute to the honesty of bank staff that more has not disappeared. But then how would we know?

Perhaps the new Governor will make enquiries?

Surely you can see that ministers cannot allow the GARDAI to investigate corruption within the government?

I’m serious abut not understanding 3.2 - can anyone help?

I’d assume market value and acquisition value relate to loans not property. Why would acquisition value be greater than current market value given the LTEV adjustment? this seems unlikely, however its an area where the Minister can alter any outcome should the answers not be to his liking.

Therefore, overdraft facilities or any other type of credit facility with the CBFSAI in favour of NAMA, as well as the direct purchase from NAMA by ESCB central banks of debt instruments, will not be possible, in view of the prohibition of monetary financing under Article 101 of the Treaty.”

Am i missing something - does this mean that banks cannot deposit NAMA bonds with the ECB. Instead they will just be worth the coupon to the banks

“The Dail asks Min Fin et al, questions. That is all it does.” Agreed, but after asking questions, it votes on legislation and if such legislation is finance related and it is vote down etc,. etc. However, my point is that this legislation becomes organic and can be changed at the behest of the minister by way of his “binding written directions.” What then, is the point of going through the pretence of debating NAMA if, the minister, can practically re-write NAMA as he wishes with his friend the CBFSAI governor who doubtless would be acting “independently” of any ministerial influence.

Will this explode in the cabinet? I hope so! Thank God for the ECB!

I’m shocked that you expose yer egnorance so!

General
Why does the NaMa Bill not contain a provision preventing all rezoning in the 26 counties until NaMa is wound up? My point made weeks ago, is that development land is created at the drop of a brown paper bag … We need a new raft of such land like a hole in the head if we are truly trying to reduce the exposure of the exchequer to the toxic debt. This would also increase the value of these excellent investments in prime locations around the state. Notice how
this recasts the valuation debate!? Now the corrupt see their future income from rezoning disappear! Oh Woe! Woe! Pity the poor bagmen!

LIQUIDATE AND BE DAMNED!

Also, although I am only a scientist and you are mostly only economists…. can anybody really understand the English???

e.g. “….will not involve undue premium payments to the participating financial institutions to avoid creating inappropriate incentives from their side as regards the use of the scheme…… ” talk about gobbledegook.

Why don’t they says it as it is “to avoid giving the banks an opportunity to trouser the money”

Bye, Barry

That concerns me too. I am not a bond expert. It would be good to get Eoin’s opinion.

1. “the ECB considers it important….that the pricing of acquired assets is mostly risk-based and determined by market conditions”, i.e. you should not use LTV for most assets.

2. ” The preference ….for the long-term economic value of assets…requires careful consideration in this context…it should be ensured that the assumptions to determine the long-term economic value of bank assets will not involve undue premium payments to the participating financial institutions”, i.e. for the minority of assets you do use it for it should not be significant.

Even if, as I would expect, the ECB put in some more qualifications and ambiguities to soften the political impact those are two criticisms that are really blunt by official standards.

Now expect some people to try to convince you that when they said the above they really meant the opposite. If I was the government I would be furiously endeavouring to get a much kinder clarifying statement from them and with Lisbon 2 coming up the Government have a lot of leverage.
Can they put the cat back in the bag?

“Moreover, the Minister (after consultation with the CBFSAI Governor, acting independently) will have the power to issue written guidelines to NAMA in connection with its functions, and may give binding written directions to NAMA concerning the achievement of NAMA’s purposes.”

“Binding written directions.” So, after all the NAMA legislation is passed in the Dail Minister Lenihan can consult with the CBFSAI Governor and then issue “binding written directions to NAMA” i.e. change NAMA without any further debate in Dail Eireann. To me that is almost like having unlimited powers handed to him and removing the oversight of the Dail. Please correct me if I am wrong and I hope I am.

http://www.rte.ie/news/2009/0831/newsspecial_av.html?2602100,null,230

http://www.rte.ie/news/2009/0831/newsspecial_av.html?2602100,null,230

Go to about 42 minutes on an valuation is explained

It is silent however on the issue of transparency that is to say the opinion makes no demands on the minister to release publicly valuation details including their rationale. While transparency may not actually be necessary in order that NAMA fulfills its 5 purposes as outlined in the opinion’s paragraph 1.1 NAMA’s success or failure depends on its acceptance by the Irish people as an appropriate method of overcoming the difficulties in Irish banks. Without transparency and an assurance that ‘commercial confidentiality’ will NOT always stand between the operation of NAMA and the citizen NAMA’s acceptance b the Irish people will be compromised.

The crucial passage as highlighted above in the Opinion however appears in paragraph 2.4.3: ‘…the ECB considers it important, in line with previous opinions that the pricing of acquired assets is mostly risk-based and determined by market conditions…’

Paragraph 2.4.7. appears to contradict paragraph 1.1 when it states that ‘an ultimate aim of an asset removal scheme is to get the banks lending again’. Whereas 1.1 states in fact there are five purposes of NAMA and while this ‘ultimate aim’ is among them it does not appear to be privileged: ‘…inter alia, to remove uncertainty about the valuation and location of certain assets of credit institutions of systemic importance to the Irish economy; to facilitate their restructuring; to restore confidence in the banking sector; to facilitate the availability of credit in the Irish financial markets; and to address the serious threat to the Irish economy and the stability of credit institutions in Ireland generally’.

The opinion furthermore appears to confirm two matters: 1. That it is the ECB which is the source of Irish politicians’ refusal to countenance nationalising Irish banks and thus acquiring all of their assets for a few billion instead of the projected (at least) EURsixti billion in ‘bonds’ (paragraph 2.4.six); and b. That the ECB is concerned about Ireland paing an ‘undue’ premium for these assets (loans and derivetives) from banks.

I didn’t see the 88% man’s presentation. Did he set it in any context? Was it real or nominal?

At face value it seems a silly assertion. Under which the 2007 peak should be 88% of the previous peak and so on. On a positive note, he must believe that future oscillations will get smaller and smaller. He makes a strong case against supporting the government’s current nama plan.

‘…will not involve undue premium payments to the participating financial institutions…’ Operative word here IMO is ‘undue’. The minister will argue such premium paiments as r made are due/appropriate.