Bernard Durkan (Kildare North, Fine Gael)
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Question 78: To ask the Minister for Finance if with the passage of time the assumptions and calculations made by him and his Department in the compilation of the National Asset Management Agency plan with particular reference to projected property discounts and eventual liability on the State were soundly and accurately projected, sourced and based; the extent to which the now emerging situation is likely to impact on the taxpayer; if he and or his Department have carried out any reappraisal or stress testing of the NAMA project with a view to the restoration of confidence in this country's economy; the nature of such changes; the extent to which economic recovery has been affected or is likely to be affected in one way or another; and if he will make a statement on the matter. [17273/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The NAMA draft business plan published in October 2009, was as the title suggests in draft from and was prepared by the interim NAMA team for the purpose of explaining the background to NAMA and the manner in which it will carry out its functions and duties. The figures included in the draft business plan were indicative figures. The NAMA Board is working on analysing the real data now available to it in relation to eligible assets and valuation. Building on this analysis, the Board will produce an updated business plan which it will submit to me by the end of June. It will then be published by the Board of NAMA.

The fact that the discount on the first tranche of NAMA loans is expected to be 47% as opposed to the initial estimate of 30% is further proof of the robustness of the overall process. This increase in the discount is a consequence of several factors; the fall in property values, a detailed scrutiny of loan and security documentation and an assessment of the prospects for the underlying property which secures loans.

The calculation of the discounts followed detailed loan by loan assessments which included legal due diligence, a detailed valuation process, and internal and external checking processes, including external audit. In my Dáil speech on banking on the 30th March I explained the impact on the taxpayer of the NAMA process and the cost of recapitalising the participating institutions. I also explained that this restructuring and recapitalisation was critical to ensure that the banks can supply the credit necessary to underpin our economic recovery. The widespread and continuing positive comment on our handling of the banking crisis reflects the fact that we have dealt with these issues head on have not shirked from the difficult decisions required. This decisive Government action will feed into the economy through increased willingness to invest in Ireland. This investment will enhance the growth of our economy.