Mr. Seamus McCarthy:

I would certainly accept that there could be a debate about it. The difficulty was that the explanations which were being provided for the appropriateness of that seemed to relate to things that, in many cases, had already been taken on board in the impairment exercises that were done after the loans were taken on. The quality of the assets was referred to as "poor" during the process of taking on the loans. I remind the Deputy that the extensive exercise through which NAMA went in the beginning resulted in much heavier discounting of the value of the loans. This reflected where they were and corrected the mistakes that had been made by banks in accepting much higher valuations than were appropriate. Having taken the price out at the beginning, and then having provided for impairments because the markets were falling thereafter, there was a danger of double-counting if a very high risk rate was built into the discount rate. In such circumstances, loans might have ended up being assessed on the basis that they were worth less than they may actually have been worth.