Written answers

Wednesday, 8 July 2009

Department of Finance

Proposed Legislation

Photo of Kieran O'DonnellKieran O'Donnell (Limerick East, Fine Gael)
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Question 43: To ask the Minister for Finance the position regarding the National Asset Management Agency; when he expects that the NAMA legislation will be published and brought before Dáil Éireann; and when and the way if will free up credit facilities for small businesses. [27952/09]

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
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As the Deputy will be aware the establishment of NAMA and the interim preparations, including the drafting of legislation, are being overseen by a NAMA Steering Group established by me. The Group comprises representatives of my Department, the NTMA and the Attorney General.

I can confirm that it is my intention to publish legislation later this month. I can also confirm that the Oireachtas will be given adequate time to debate the important issues arising from this legislation and I expect that it will be before the Dáil in September.

The establishment of NAMA will deal with the uncertainty surrounding the riskiest assets on the balance sheets of the Irish banks, which were preventing them from lending into the economy, including to small businesses. The removal of these risky assets will provide assurance for international investors and providers of long-term capital for banks that the problem of balance sheet impairment has been comprehensively addressed.

NAMA will purchase the assets through the issue to the banks of Government bonds and the institutions concerned can then use these bonds to avail of ECB funding. In order to provide credit more freely, banks need access to funds, adequate capital and market support. The package of measures of support provided to the banking system, including the guarantee, capitalisation and NAMA, are aimed at ensuring the stability of the banking system and its ability to support the credit needs of the economy.

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