Brian Lenihan Jnr (Dublin West, Fianna Fail)

-----by facilitating the economic recovery widely forecast to get under way in the second half of this year. The Government will insist that they do so by supplying credit to viable businesses and households in this State.

Today, we are entering the ultimate phase in the resolution of our financial crisis. NAMA has determined the price to be paid for the first tranche of loans to be transferred to the agency, after detailed and painstaking loan by loan analysis. The Financial Regulator and the Central Bank have carried out their analysis of the appropriate capital requirements for financial institutions so as to ensure not just the bare regulatory minimum, but a prudent and adequate deployment of capital. I will outline in detail to the House the Government's response to these developments and explain the strategy for addressing the needs of the banking sector and individual banks.

The process of transferring the eligible loans from the designated financial institutions to NAMA has begun. The first tranche of loans has an original book value of approximately €16 billion. This tranche consists of just over 1,200 individual loans owed by the ten largest borrowers. This first tranche represents 20% of the anticipated total assets to transfer. The transfer of these loans should be completed for four institutions in the coming days, with Anglo Irish Bank following next week. NAMA has advised me the whole transfer process remains on target for completion by the final quarter of the year.

NAMA's work has enabled us to estimate with greater accuracy the overall discount to be applied to each institution and the likely total amount of loans to be transferred. The original value of the loans transferred in the first tranche is €3.29 billion for AIB from a total of €23 billion in eligible loans; for Bank of Ireland, €1.93 billion from a total of €12 billion; for Anglo Irish Bank, €10 billion from a total of €36 billion; for INBS, €670 million from a total of €9 billion; and for EBS, approximately €140 million from a total of €1 billion.

The difference between what NAMA has paid for these loans and the original value attributed to them by the institutions, or the so-called haircut, is as follows: AIB, 43%; Bank of Ireland, 35%; Anglo Irish Bank, about 50%; INBS, 58%;-----

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