NAMA Board Appointed Post author By Karl Whelan Post date December 22, 2009 The board of the National Asset Management Agency has been announced. The announcement from the Department of Finance is here. Newstalk have information on the board members here. Categories In Banking Crisis Tags NAMA 30 Comments on NAMA Board Appointed ← Seelig Email to Department of Finance → Morgan Kelly: “The Irish Credit Bubble” 30 replies on “NAMA Board Appointed” Did you notice: “Mr. Steven Seelig, will be appointed to the Board in May 2010, when he retires from the IMF. In the meantime, Mr. Seelig will be available to provide advice, in a personal capacity to the NAMA Board.” I would have preferred to see more skill-sets on the board. I would have liked to have seen a Chief Information Officer type to give an overview on technology issues. I think information systems are key to the proper administration of the NAMA assets. I would have liked to see an official from the NTMA or other trader type on the board to oversee issues as regards NAMA bonds. I would have liked to see a lawyer on the board to question and dissect the legal advice NAMA receives (for example, to decide how much confidentiality is really required and if all the legal due diligence being recommended is really required – paid advisers will be naturally cautious). It is a half decent board but not nearly as strong as it should or could be. Probably a stupid question, but will there be any overlap between this board and the board of the SPV? @Zhou So you’d like to have seen an IT specialist, a bond trader and a lawyer on the board. Any other professions that you think might have had something to contribute? Hint: Think of the name of this blog. 😉 Having the board led by the former public interest director at Anglo Irish Bank might seem ok, but it could be problematic. Even a public interest director is likely to have a somewhat “insider” bias toward the bank. It ought to be someone without any insider connection to any of the key institutions to be paid large sums by NAMA. Obviously in a small country it is difficult to eliminate all inter-connections but I would have preferred a hard-headed businessperson from outside the banking industry. Michael O’Leary where are you when we need someone with a sharp eye for tight budgeting! We want a board which will not allow NAMA and the banks to fudge the valuations at enormous long-term expense to Irish taxpayers. Congratulations Karl, Morgan, Peter, Constantin and colm on your non – appointment. This shows your independence. @Gregory “public interest director ” – wha da? there is no such beast. There is only director. Mr PiD you refer to is someone appointed to manage the value of the share of the MoF. That may or may not intersect with the public interest. Prediction – this board is not a tiger, not even a pussycat. It will, as are most boards of public bodies,be supine. Merry xmas everyone @ Gregory Connor Not to mention the irony of a Finance Director of AIG financial services. @Gregory. Insiders? Eilish Finan is former CFO of AIG, Michael Connolly is former Bank of Ireland senior management and Willie Soffe is former county manager of Fingal County Council. Still, good to see that none of those pesky economists and their ‘ideals’ made it onto the board. Ideally, I’d like to have seen the worst sort of vulture capitalist, bottom-feeding shark, hard-hearted B. on the board. This is, after all, our money they are weeing into the Liffey. Returning it to us at the expense of the great and the good should be their objective. Still, that would go against the stated aims, wouldn’t it? If you dont have an economist then you dont have to listen to them… It is quite simple, isnt it. I wonder what the age profile is? Might have made sense to have ‘younger’ appointments with a future reputation at stake, rather than people that can dissppear into the mist. Whatsda name of that minister that did the deal with the religious… Eventually you wont be able to tell the trees from the woods Al Anyone got a take on the valuation regulations which have also just been released. http://www.finance.gov.ie/viewdoc.asp?DocID=6140 This is indeed not the group of people I would want to look after so much of my money. Oh richard….for shame….what, you wanted experts and asset management professionals? come come….. @frank I like the oft repeated phase within these regulations “NAMA shall have regard to such of the data and analyses as it considers appropriate,” versus “as are appropriate”. I do like also the fact that the Jones Lang Lasalle index is one of the benchmarks. Wonder how that got in these to the exclusion of others…. @Karl Jaysis, sorry. I’ll get my coat 🙂 Busy day at DoF. I’ll start a thread on the LTEV document rather than muddy it up with the Board discussion. Is this reading the valuation rules right — that they just add 80 basis points to Irish 10 year bonds? frank – yep. NAMA-yokes are not risky at all at all at all at all at all at all…sure if they were they wouldnt be discounted at nearly the ten year rate. That they are discounted at that proves that they are nearly riskless. NAMA LTEV regs post now up. Restrict discussion here to the NAMA board or …. or nothing, what do I care? But there’s a thread for it if you want to use it. @ Brian L “Congratulations Karl, Morgan, Peter, Constantin and colm on your non – appointment. This shows your independence.” I know its the season of miraculous births n’ all that, but probably expecting a bit too much if you were looking for the NAMA plan to be brought into this world led by some of the most vocal opponents of the, eh, NAMA plan…Still, maybe Santa will be kind enough to involve a few more heavyweight hitters with it in the New Year… 😀 I think Stephen Seelig could be classified as an economist: E.g. Senior Economist and Deputy Director of FDIC, Division of Research and Statistics. Ph.D. (Economics), Clark University; M.A. (Economics), Washington University; B.A. (Honours in Economics) @ Desmond Yes, of course Mr. Seelig is an economist and a well-qualified one—apologies if my comments suggested somehow otherwise. I guess, without saying so, I was implicitly discussing the homegrown element of the Board. Also, Mr. Seelig will be joining the Board after many of the key decisions have been taken. But, yes, to ask for two economists on a board featuring multiple accountants was clearly too much to ask for. Whew! It’s even bad politics not to have appointed a competent critic. A body like that needs a David Blanchflower. Even worse than the composition of the board, the two key roles – – chairman and MD – – have been filled by products of the conservative public service. We have some similarities with Japan but the new government there, is trying to reduce the role of ex-bureaucrats. Maybe, the minister is regretting having a “turbulent priest” at the central bank – – an appointment that will surely be regarded as one of his most impressive decisions. A new government can sack them and get rid of NAMA altogether. Just in case we give the impression that it is written in stone! And a Happy New Year! @ Karl there is of course the possibility that lots of people wouldn’t touch such a publicly divisive project such as NAMA with a barge pole… Apart from the IMF Trojan Horse how many of these are not Irish? @karl Though there is a case for a second economist. Mr Seelig is clearly an excellent first choice, having experience both of large scale fiscal crises – and deep experience of “bad banking”. I imagine there are few more qualified than him. However… Nama is a HUGE intervention by the government in the Irish economy. In the short run, it won’t merely distort the banking & property markets… it will actually define them. I’d note here that stockmarkets (for example) are highly self regulated regards such matters as transparency, liquidity & neutrality. Hayek, an arch-priest of the free-market (which I admire) , called for regulation of at least information – else market efficiency is not possible. As we well know the property market is both sticky… and opaque (with serious latency even where it is transparent). In general it is a fundamental challenge to steer property markets towards (not to) efficiency. We are well aware of the information deficits: just what feicin price does stuff sell for ? What’s the oversupply ? etc etc… property markets need a cleverer design of information flow etc. The property market here was obviously very inefficient and we’d an ‘orrible bubble – and remains turgidly slow in correction. Determining correct property pricing is very far from trivial – especially in the background of the major fiscal crisis. Nama may well “succeed” and Mr Seelig could see to that… but it could create a market imbalance – which could lead to further issues. There’s a lot of room for maneuver on what Nama does e.g. – Sell off one of the SPV’s to private investors – Make investment decisions to complete certain developments (and not others) – Securitize and sell off some loans – Securitize properties and set up an exchange traded unit fund (that I’d like) Given as I said the “wider fiscal crisis” and macroeconomic issues – I think it would be prudent to appoint a second economist who’d focus on how Nama fits into “the big picture”. This person would ensure that Nama’s results were sustainable in the wider context and the long run. This economist should be familiar with the Irish Economy… I’d dare suggest perhaps Philip Lane I’m uneasy about the board. Too many locals (8 out of 9) and too many of those connected with the establishment (4 out of the 8) presumably because they “understand” the Irish situation etc. Would have like to have seen a few more real outsiders with direct experience of very large scale asset recovery operations, with well known views on protecting the taxpayers and with track record in pursing loan defaulters. Bearing in mind that Nama will be one of the largest property companies in the world, its board and management must be world-class. Anything less is equivalent to sending a boy on a man’s errant. Bearing mind that the three most important factors determining the sucess of a venture are management, management and management. The proposed staffing of Nama is only a fraction of that used by the Swedish “bad” bank operation which dealt exclusively with nationalised banks and had a loan portfolio far smaller than Nama’s. It appears that each Nama staff member, including clerical staff, could be managing a highly fragmented, complex portfolio worth about €2 billion. Such an approach is penny wise and pounds foolish and a clear recipe for cock ups. Comments are closed.