Clare Daly (Dublin North, Socialist Party)
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75. To ask the Minister for Finance the reason a discount rate was applied to Irish Bank Resolution Corporation loans but this did not apply to residential mortgage holders. [44031/13]

Michael Noonan (Limerick City, Fine Gael)
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The Special Liquidators are obligated to ensure that the assets of IBRC are sold at a price which maximises the overall return for its creditors including the State. As a result the Special Liquidators are currently in the process of devising and implementing a sales process in respect of these assets. I have been advised by the Special Liquidators that the valuation process is on- going and that the Special Liquidators are taking professional advice as to whether a loan should be sold individually or as part of a portfolio in order to ensure that the maximum value is obtained for that asset within the instructed timeframe. There is an obligation on the Special Liquidators to ensure that the assets of IBRC are sold at a price that is equal to or in excess of the independent valuations that are being obtained. Should a bid not be received that is in excess of the independent valuation obtained, the loan asset will transfer to NAMA at the independent valuation price. In arriving at the valuation of IBRC loan assets (including residential mortgage loan assets), the independent advisers have been advised to apply a discount rate of 4.5% in determining the present value of future cash flows of the asset in the case where a discounted cash flow valuation methodology is employed. Further, a discount of 2.32% will be applied to all loan asset valuations to take into account security and title issues associated with loan assets, to arrive at the Valuation Price. Should the assets not be sold to a qualified bidder at a price that is equal to or in excess of the Valuation Price then the asset/portfolio will transfer to NAMA at that price.

Therefore I, as Minister for Finance, in my Instructions to the Special Liquidators have not differentiated between residential mortgages loan assets and other loan assets for valuation purposes.

The decision concerning how the loans will be packaged for sale and what bidders constitute qualifying bidders for the purposes of the sales process is to be made by the Special Liquidators.