Dáil debates

Thursday, 12 November 2009

National Asset Management Agency Bill 2009: From the Seanad

 

12:00 pm

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)

The amendments deal with the designation of assets in participating institutions and, therefore, their purpose is to clarify as a matter of legal definition what assets are transferred to the agency by a participating institution.

Deputy Burton raised two entirely separate questions. One relates to the persons who owe money to participating institutions and she suggested by inference they were preparing for NAMA. They have no function in this regard because the institutions are preparing the assets for transfer, not the borrowers. The Deputy is rightly and properly concerned that some of the borrowers may be structuring their assets and internal affairs to minimise their exposure in respect of the liabilities they owe to the institutions. Although it does not arise under these amendments, we have gone in the legislation as far as we can go under the Constitution to ensure when the assets are transferred to NAMA, the agency has powers to deal with such borrowers.

With regard to family matters, section 211 permits NAMA to apply to the courts to set aside the disposition of an asset which was designed "to defeat, delay or hinder the acquisition of NAMA or a NAMA group entity of an eligible bank asset, or to impair the value of a...bank asset or any rights . . . that NAMA or the NAMA group entity would have acquired or increased...[but] for that disposition". It empowers the court to set aside that disposition. Ample provision is made in the legislation for the avoidance of transactions designed by borrowers to evade compliance with their obligations.

The other issue raised by the Deputy is the offshore operations of banks. The word "offshore" is used but the three principal banks in Ireland all have operations in other jurisdictions ,which are fully regulated in those jurisdictions and which are part of the ordinary course of banking in them. I am not quite clear on this aspect of what the Deputy is probing, as this does not arise under these amendments. Clearly a designated class of assets will be transferred to NAMA but if the Deputy has information about improprieties in domestic banks in connection with their overseas and external operations, then naturally those matters should be brought to the attention of the regulatory system.

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