Wednesday, 8 May 2013
Department of Finance
65. To ask the Minister for Finance further to the publication of the 2012 unaudited accounts for the National Asset Management Agency, the reason interest income increased in 2012 compared with 2011, despite loans decreasing by €3bn and the European Central Bank reducing its main interest rate from 1.0% to 0.75% in July 2012. [21638/13]
I have been advised by NAMA that interest and fee income of €1.39 billion recognised in its 2012 unaudited accounts principally comprises interest recognised on its loans and receivables in accordance with the effective interest rate method of accounting which accrues interest at a specified interest rate each year. Such interest recognised on loans and receivables does not necessarily correlate with ECB interest rate movements. This is further explained in Note 2.8 (Interest Income and Expense) on page 22 and Note 3 (Interest Income) on page 26 of the unaudited Section 55 accounts of National Asset Management Limited.
66. To ask the Minister for Finance further to the publication of the 2012 unaudited accounts for the National Asset Management Agency, if he will provide an explanation for the line item portfolio management fees which in 2012 amounted to a cost of €4,670,000 compared to €15,902,000 in 2011. [21639/13]
I have been advised by NAMA, that portfolio management fees principally comprise direct fees incurred in the on-going management of debtors. 2012 costs include, inter alia, property valuation, asset search and loan sale costs. The reduction in costs in 2012 to €4.67m from €15.9m reflects the fact that the majority of the 2011 costs related to fees for the independent review of debtor business plans. The independent review of such debtor business plans was substantially concluded in 2011.
67. To ask the Minister for Finance further to the publication of the 2012 unaudited accounts for the National Asset Management Agency, the reason due diligence costs of €4,086,000 were recorded in 2012 in view of the fact that the last tranche of NAMA loans were acquired in March 2012; and if the due diligence costs are properly rechargeable to the banks from which the loans were acquired. [21640/13]
NAMA has advised that loan due diligence was substantially completed by the end of March 2012. The due diligence costs incurred in 2012 reflects the final settlement of fees to NAMA’s appointed advisers. Since inception, NAMA has recovered from the participating institutions €64.1m, of its total due diligence costs of €78.2m, through a reduction in the acquisition value of the loans. The balance of due diligence costs of €14.1m, including costs of €4.1m in 2012, has been expensed in NAMA’s accounts.
68. To ask the Minister for Finance further to the publication of the 2012 unaudited accounts for the National Asset Management Agency, the staff costs excluding employer pension contributions and pay related social insurance in 2012; the average number of full time equivalent employees at the Agency during the year; and if he will make a statement on the matter. [21641/13]
All NAMA staff are employees of the NTMA and under section 42 of the National Asset Management Agency Act 2009, the NTMA assigns staff to NAMA. NAMA reimburses the NTMA the costs incurred by the NTMA in assigning staff and providing business and support services to NAMA. NAMA staff costs, excluding employer pension contributions and PRSI, were €21.952m in 2012. NTMA staff members are subject to the Public Service Pension Deduction. The average number of NTMA employees assigned to NAMA during the year was 214.
NAMA also draws on the NTMA’s shared services in a number of areas including Finance, HR, IT and market risk. Staff costs in the provision of these shared services are not included in the above figure.
69. To ask the Minister for Finance further to the publication of the 2012 unaudited accounts for the National Asset Management Agency, if he will confirm the split of the €2.8bn of asset disposals between loan sales and real estate property sales. [21642/13]
I have been advised by NAMA that asset disposals in 2012 of €2.8 billion comprise €2.3 billion from the sale of property collateral secured against loans and €0.5 billion from loan sales.
70. To ask the Minister for Finance further to the publication of the 2012 unaudited accounts for the National Asset Management Agency, if he will confirm the percentage of non-performing loans by reference to nominal values and the original loan terms. [21643/13]
I would direct the Deputy to page 10 of the NAMA Section 55 Report for the fourth quarter of 2012 which states that, as at 31 December 2012, 82% of the loans acquired by NAMA were classified as non-performing. This classification was primarily by reference to the original legacy loan agreements that pre-dated NAMA loan acquisition. I would also direct the Deputy to page 9 of the NAMA Section 55 Report which shows that, when one also factors in income captured by NAMA in respect of partially and non-performing loans (including enforced loans), the weighted-average performance is measured at 33% for the same period.