Mr. Brendan McDonagh:

We have been here before and we have been criticised for not having an up-to-date valuation of the assets. We did have an up-to-date valuation of the assets, which valued them at €265,000, whether the members like it or not. That is not NAMA's valuation but an independent third-party valuation. We achieved the value for the assets. The fact that, before NAMA ever acquired the loans, the original bank had lent these debtors €8.4 million on these assets clearly means they were never worth €10 million in the first place. When we inherited it, it was €8.4 million. What brought it over €10 million was that we charged €1.9 million in interest during our life but that was never paid by the debtors. They never paid a penny of it. Effectively, that brought it to more than €10 million. That does not change the fact that, if your only recourse is to the assets themselves and they are worth €265,000, that is all that can be recovered, whether by NAMA, Bank of Ireland, AIB or any other body, because that is the value of the assets.

The fact that €10 million had been built up and was owed is shocking. I agree with Deputy Dillon on that. I totally agree with everybody and can understand people's angst about it but the reality was that, when we got to dispose of the assets, we got a valuation that said they were worth €265,000 and we got €265,000 for them. That was the only alternative open to us. After the receiver resigned, the assets were back in the control of the debtor and we could not do anything about that. In fact, when the receiver resigned, the HSE contacted us and said that there was a vermin infestation on these lands and that it wanted to pursue whoever was responsible for the infestation under the Rats and Mice (Destruction) Act 1919. We said that we were not responsible because, once the receiver resigned, the lands were back in the control of the debtors.

There were all sorts of issues attached to these lands. These were not grade A quality assets. They were assets in a dishevelled state and situated on very poor quality marshland. What shocks me is that this amount of money was lent against this really poor quality land and unfinished housing estates that had been subject to all sorts of vandalism. In correspondence with us that I am happy to provide to the committee, the HSE even outlined how there were open manholes, which were a big problem in terms of health and safety. It is important to understand that the assets were worth what they were worth. Do I wish the assets were worth more? Of course I do. However, they were impaired by the fact that we could not get anybody to sell them for us. On that basis, there was no alternative bar holding onto the assets and getting nothing for them. They would still be there at the end of the life of NAMA and I would not be before the Committee of Public Accounts having to deal with this because somebody else would have had to deal with it at the end of the life of NAMA. However, we are charged by the Minister of Finance with getting our portfolio down to zero and, as part of that, we have to take difficult decisions. Part of this is involved getting all of the relevant information. We had the independent valuations and all we could get for it was €265,000. Unfortunately, there was only one buyer for this asset.