Tag Archives: Frank Daly

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A letter Pimco has sent to the Public Accounts Committee

This morning.

At the Public Accounts Committee (PAC).

The committee briefly discussed a letter sent to PAC by Pimco – one of the bidders for Nama’s Northern Ireland property loan portfolio until it learned of a fixer fee arrangement.

The arrangement involved a sum of £16m to be split US lawyers Brown Rudnick, Belfast law firm Tughans and Frank Cushnahan, a former member of NAMA’s Northern Ireland Advisory Committee.

On July 9, 2015, Nama chairman Frank Daly told PAC that once it (Nama) became aware of the fixer fee arrangement and Frank Cushnahan’s alleged involvement in March 2014…

“…that’s why we threw Pimco out, or sorry, got Pimco to withdraw,”

However, Pimco contests this and, in the letter above, says not only did Pimco withdraw from the sale, of its own accord, Nama attempted to convince Pimco to continue with the sale despite knowledge of the fixer fee arrangement.

From the letter:

Pimco has been disappointed that Pimco’s withdrawal from Project Eagle has been repeatedly mischaracterised by Nama. We would suggest that Nama has conflated what may or may not have ben discussed at the Nama Board level (upon which we cannot comment), and the reality of the calls that Pimco made to Nama and Pimco’s own decision to withdraw.

The reality of Pimco’s decision to withdraw was reflected more accurately by Mr [Alan] Stewart in his evidence to the committee on 25 October 2016. Pimco welcomes his confirmation that Pimco withdrew from Project Eagle, and was not at any stage asked to leave the process by Nama.

Pimco is largely in agreement with the summarised call notes appended to the report of the Comptroller and Auditor General at Appendix E of the report entitled, ‘National Asset Management Agency’s sale of Project Eagle’, dated August 2016, although certain points are clarified below.

It should be noted that the reference  to “a success fee arrangement (being) in place between Pimco and Brown Rudnick” noted in the report is inaccurate. Whilst an arrangement was proposed by Brown Rudnick, it was never agreed to by Pimco.

As descibred in the notes, following a request by Pimco for a call on 7 March 2014, Pimco Legal spoke to Nama on 10 March 2014 and informed Nama about the proposed success fee arrangement. Pimco wanted to understand whether, and ensure that, Nama was aware of Mr Cushnahan’s role and the fee arrangement that had been proposed to Pimco. Pimco states that it would not proceed unless and until it was clear to Pimco that Nama was aware of Mr Cushnahan’s role in Project Eagle (including his potential interest as a beneficiary of a free arrangement as had been proposed to Pimco). Pimco described details of the fee that had been proposed and the reasons for its concerns.

The Nama attendees confirmed that they were not aware of the proposal but enquired as to wether Pimco would proceed in Project Eagle should Mr Cushnahan’s involvement, or the fee proposal to Pimco, be an issue for Nama. Pimco confirmed that it was not currently proceeding with the transaction and that any decision to proceed or not would be informed by Nama’s response. Nama agreed to consider the matter further and revert to Pimco.”

We can confirm that in no way did Pimco seek the acquiescence of Nama to any fee arrangement, nor seek Nama’s agreement that any fee arrangement was appropriate. That is also clear from Nama’s own minutes of the calls and the evidence of Mr Stewart to the PAC, who confirmed that did not happen.

As the notes outline, Nama contacted Pimco the following day (11 March 2014) to advise that the Nama Board considered the involvement of Mr Cushnahan to be a very serious issue for Nama. Pimco agreed to revert to Nama and on a futher call, later that afternoon, Pimco informed Nama of its disappointment that disclosures had not been made by the relevant parties to Nama. Pimco informed Nama that it did not want to be part of any process where there was any suggestion of impropriety and was willing to withdraw.

While it is for Nama to explain the reasons for the questions asked of Pimco on the call (and we note Mr Stewart sought to address this topic in his evidence to the committee) Pimco can confirm that on that call we were asked by Nama if we had considered “other options”, such as proceeding without the three parties, and we were asked to consider, before closing any doors, whether every option was being considered. Pimco agreed to give the matter final consideration and to revert again.

On 12 March, Pimco advised Nama that it had not option but to withdraw form Project Eagle. Nama expressed its disappointment but accepted the decision.

Pimco confirmed its decision to withdraw in writing on 13 March 2014.

In the last hour, chairman of PAC Sean Fleming said the letter would be sent to Nama “within 24 hours, asking for a paragraph-by-paragraph response, confirmation or disagreement, paragraph-by-paragraph.”

Comptroller and Auditor General (C&AG) Séamus McCarthy is now fielding questions from the committee.

Watch today’s PAC proceedings live here

Related: John McGuinness: Nama may have misled PAC (Sunday Business Post)

Pimco denies it was forced out of Project Eagle by Nama (Irish Examiner)

Pics: Jack Horgan-Jones and Hugh O’Connell




This evening.

On RTÉ’s Six One.

Chairman of Nama Frank Daly was interviewed by Brian Dobson.

At the very  end of the interview:

Brian Dobson: “You still say tonight, that the taxpayer got full value?”

Frank Daly: “I say, absolutely, the taxpayer got full value for money. And I say it even more strongly now in a post-Brexit environment. If we were trying to sell that portfolio now – we would not get offers anywhere near £1.32billion).”

Watch back in full here


Namawinelake writes:

What loss did Nama make on the Project Eagle transaction?

Depends on how you define “loss”!

The Nama projection of its ultimate profit by 2020 is €2.3billion. If it hadn’t sold Project Eagle in 2014, and worked the loads out between 2014-2020, the ultimate profit would be €2.74billion. So, the loss is €440million*.

By selling the loans in 2014, Nama did not generate £1.68billion in projected net cash receipts by 2020 on those loans. Instead, it sold the loans for £1.3billion.

So, the loss is £380m (€444m). This loss arose from two decisions (1) the decision to sell in 2014 rather than manage the loans until 2020 and (2) the decision to sell the loans below Nama’s own valuation.

On the other hand, if you compare the safe value of the loans in 2013 (£1.3billion) versus the Nama valuation of the loans in 2014 (£1.49billion), the loss is £190million (€222m).


1-  Nama has until 2020 to manage its loans so as to maximise their value for the taxpayer. Nama did not have to sell the loans in 2014; it could have managed the loans until 2020, which would have resulted in the loans generating £1.68billion, according to Nama’s own projections.

2-  Nama used the proceeds from the sale of Project Eagle to redeem senior bonds which have a zero (technically a minus) interest rate. Nama could have used the proceeds from the Project Eagle sale to invest in its assets, but it didn’t; Nama used the cash to pay down its own debt which cost it nothing.

Report Extracts (which emphasis added).

“In a paper submitted to the Board for the December 2013 meeting (reproduced in Appendix C) the Nama executive sought the Board’s approval for the sale of the loans. The paper indicated that the total Nama debt for the loans at the end November 2013 was £1.98 billion – equivalent to 43% of the par debt.”

“Cash flow projections indicated that Nama would realise net receipts totalling £1.68 billion over the period 2014 to 2020 if it worked out the loans through the sale of the underlying assets in line with its formal strategy.”

“The minimum price of £1.3billion set for the sale of the Project Eagle portfolio was significantly less than Nama projected it would realise from working out the loans – an estimated £1.68billion, equivalent to £1.49billion in NPV terms, using Nama’s standard discount rate.”

The difference between the minimum price and the projected NPV of the workout was up to £190million, depending on the extent to which the adjustment of the 2017 disposal proceeds was valid.”

“As a result, the decision to sell the loans at £1.3billion involved a significant profitable loss of value to the State.”

“Ultimately, the loss incurred when the sale was completed was recognised in Nama’s financial statements for 2014.”

Previously: ‘A Probably Loss Of Value To The State Of Up To €190million’



Independents 4 Change TD Mick Wallace writes:

“For too long the Minister for Finance and Taoiseach have displayed breathtaking indifference, and at times arrogance, to any form of oversight of NAMA.

The C&AG report deals with just one aspect of NAMA’s operation – if the Government want all the truth in the open, only a truly Independent Commission of Investigation has any chance of exposing just how dysfunctional this organisation has been, and what the cost has been to the people of Ireland.

 Until then, the proceeds of the sale of Project Eagle should be frozen, under the ‘Proceeds of Crime Act’ and all NAMA activities should be suspended.

Previously: Project Eagle And the €3.5billion Haircut

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A response from chairman of Nama Frank Daly to the Northern Ireland Finance and Personnel Committee this evening.

It follows the publication of the Stormont committee’s report on the sale of Northern Ireland’s property loan portfolio, Project Eagle – which was critical of Nama and Finance Minister Michael Noonan.

Previously: Contradictions And Refusals

Spotlight Falls On Noonan

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Chairman of NAMA Frank Daly and Finance Minister Michael Noonan

You may recall the sale of Nama’s property loan portfolio in Northern Ireland – the biggest loss on a Nama loan sale for Irish taxpayers.

The sale is now the subject of investigation by the National Crime Agency in the UK and the Securities and Exchange Commission in the US.

You may also recall how Stormont’s Committee for Finance and Personnel carried out a ‘fact-finding’ review of the sale for eight months.

Publication of an 18-page report on the progress of this review was embargoed until just after midnight this morning.

It criticised Nama and Finance Minister Michael Noonan – specifically for Nama refusing to give oral evidence to the committee; for Minister Noonan not encouraging Nama to give the same; and for Minister Noonan not stopping the sale of the Northern Ireland portfolio once he became aware that bidders PIMCO were due to send a sum of money to Northern Ireland Nama advisor, Frank Cushnahan.

From the report…

For its part, DFP [Department of Finance and Personnel] provided initial oral evidence and papers on 23 July 2015, but subsequently delayed providing further evidence until 9 October 2015, after it had concluded an internal file review and engaged with the NCA.

NAMA, on the other hand, while agreeing to answer questions in writing, refused to give oral evidence. The reason cited by NAMA is that the appropriate forum to which it should account for its activities is the Oireachtas and to committees established by the Oireachtas.

While the Committee does not dispute this point, it believes greater co-operation from NAMA would have assisted it in fully understanding the DFP-NAMA relationship since 2009.


As with the oral and written evidence received from the other stakeholders, including the documents received from the Republic of Ireland’s (RoI) Department of Finance and NAMA, the Committee placed the DFP papers in the public domain, except for seventeen documents relating to individual borrowers.

In this latter case, DFP cited data protection and commercial sensitivity concerns for its request that the documents were not to be released. The Committee, however, took legal advice on this matter and continues to pursue the issue with DFP.


In addition to the aforementioned evidence gathering exercise, the Committee accepted an invite from the Dáil Public Accounts Committee (PAC) to make a formal address on the progress of the review. This invitation was made in light of the respective committee inquiries into the Project Eagle sale.

During the address on 1 October 2015, the Chairperson also took the opportunity to point out that there was an increased onus on NAMA to appear before the Committee, even simply out of courtesy and respect for the institutions in Northern Ireland.


The Committee notes with regret the decision of the NAMA Board not to suspend the Project Eagle sales process once PIMCO had disclosed to the Agency in March 2014 that PIMCO’s proposed fee arrangement with the Brown Rudnick international law firm included also the payment of fees to Tughans, a Belfast law firm, and to a former external member of NAMA NIAC. From the evidence to date, the Committee considers this development to be a core area of concern within the entire sale and purchase process. The need for further information and clarification in this regard underlines the case for NAMA attending an oral hearing of the Committee.

Whilst it is does not fall to this Committee to pursue, given the seriousness of the revelation by PIMCO, it is unclear why the Irish Government’s Minister for Finance, Michael Noonan, did not intervene at this point, by exercising his general powers of direction over NAMA to suspend the sales process until matters were investigated fully. The Committee also notes that Minister Noonan did not inform the Northern Ireland Executive of this development. In addition, the Committee regrets that Minister Noonan did not encourage NAMA to attend an oral hearing of the Committee.


The Committee established that NAMA ‘…had no knowledge of meetings between Mr Cushnahan and prospective purchasers of NAMA-secured assets in Northern Ireland…’ including whilst he was on the NAMA NIAC. This is deeply concerning to the Committee.


The Committee also noted from the BBC (NI) Spotlight programme that the other former external member of the NAMA NIAC, Mr Brian Rowntree, stated that the NIAC members had access to information which was of a ‘commercially sensitive nature’ and which offered ‘commercial opportunity’ and would have been of some value to a bidder for Project Eagle.

This is of particular significance as it appears to contradict the position adopted by NAMA to date. For example, in written evidence to the Committee on 27 November 2015, NAMA stated that the external members of the NAMA NIAC ‘never had access to confidential information’. Furthermore, in evidence to the Dáil PAC on 9 July 2015, the NAMA Chairman, Mr Frank Daly, stated that the external members of the NAMA NIAC ‘did not gain any confidential information or any useful insider information from being a member of that advisory committee’.

Therefore, given these seemingly contradictory positions, the Committee recommends that a full examination is made of what precisely was discussed at the NAMA NIAC meetings and what information was shared with the NIAC members.


The Committee found the refusal of NAMA to attend an oral evidence session particularly unhelpful. NAMA needed to be more open and accessible given the importance of the Project Eagle portfolio to the Northern Ireland economy. The Committee does not accept NAMA’s rationale for not attending an oral hearing of the Committee, especially given that Agency representatives have previously held many meetings with Ministers and officials in Northern Ireland.

Read the report in full here

Previously: Spotlight Falls On Noonan

Mark Stedman/Rollingnews

H/T: Namawinelake

90230988Nama chairman Frank Daly (above) spoke to Seán O’Rourke on RTÉ’s News At One yesterday Nama’s plans to develop the Dublin’s Docklands and clear Anglo’s loan book.

You may want to sit down.

Frank Daly: “I think the first thing to say is that the docklands area is a hugely successful area. There’s 40,000 people employed down there – everything from commercial law firms, to IT to the financial services. And I suppose the best way to illustrate it, Seán, is that we know there’s going to be more demand for those services, we know there’s going to be further growth down there. I’d say to anybody to just take a walk around the docklands at the moment. And maybe do even more. Last week, I was down in the high-rise Google building that we sold to Google, Montevetro building, we sold to Google very successfully last year. And, from that, you get a great picture of what the docklands is but, more importantly, what the docklands can be. Because if you look down there, and look down the river, look particularly to the northside which is the area, one area we’re concentrating on, you see all these new buildings, very successful activity – IT, commercial law, finance. But, look, and you’ll see an awful lot of gaps. You’ll see derelict sites, you’ll see half-built buildings, like the infamous Anglo building, which we also sold to the Central Bank and which will, now hopefully, be fitted out fairly soon. Then you say, well, who has security over those derelict sites? It’s Nama, largely. And who has the where-with-all, because of the cash we’ve generated, to actually do something about those sites? And again, it’s Nama. So we can pull all of this together and that’s why we’re saying today, this is an area we’re going to concentrate on. Now, I would be at pains to say, you know, we’re not throwing everything we have into the Dublin docklands. There are other developments in Dublin that we are actually funding. And there are developments throughout the country that we are funding and we have the where-with-all to do that because of the cash we’ve generated…”

Sean O’Rourke: “But what are you planning to make happen in the docklands?”

Daly: “We’re planning to make available there, the type of quality, commercial office space that will be needed; that the IDA have told us will be needed, that the FDI (foreign direct investment) will need over the coming years. It’s not there at the moment. We could be facing a shortage of that in Dublin, and in other cities. And I think that’s where Nama can step in and make a very positive contribution.”

O’Rourke: “So how much office space, how many construction jobs, over what time? Have you worked out that?”

Daly: “We’re not going to be specific about what we’re going to do and we’re not going to be specific today about what we’re going to invest there. I don’t think that would be wise because there is a whole process of planning and infrastructure to be done there. And we very much welcome, by the way, the decision of the Minister for the Environment, for a strategic development plan in that area, because that will help move things along and we’re going to be part of that.”


O’Rourke: “Presumably, on a strictly confidential basis, you had good advance warning from the Government about the liquidisation of the IBRC and the folding in then of its assets, worth some €16billion in its loans, into Nama. How well prepared are you for that?”

Daly: “Well, we had…Yes, we had some advance knowledge and advance warning. I think…The way I’d like to say we’re prepared is that, first of all, we have a structure in Nama, into which this can fit, right? But there is a lot of work to be done. There are two issues here. One, is that we will not know what we’re getting until some time around August, until the liquidator has done his jobs, in terms of valuing the loans and then selling off as many of them as we can. Cause remember we only get what’s left. So we’re not going to see what we’re getting, until later in the year. But we can do a lot of planning. I think the other issue we have to decide fairly quickly, not least for our own planning purposes but, in fairness, to the staff in IBRC, who are in a period of great uncertainty about their future at the moment. We need to decide what’s our approach going to be there. And I, remember I was a public interest director in Anglo for a year, so I know a lot of the staff, I know the value of the staff. A lot of them are people who had, who are very good workers, very diligent, had no responsibility for the really bad decisions that were taken there and has that bank in the mess it got into. So, in fairness to them – we need to address that fairly quickly. And we will do that. Certainly, it’s a matter of urgency for the board of Nama.”

O’Rourke: “The suggestion is though that you’ll be in a position to offer about two thirds of them jobs with Nama and then maybe some 300 or so will be maybe let go, made redundant.”

Daly: “It’s far too early Seán to actually speculate about numbers. Remember there’s about 250 staff in IBRC who are already managing loans on behalf of Nama. So certainly, umbers like that will certainly have to stay, but on top of that, it really depends on what we get in August. You know, what’s the residual number that’s coming to Nama.”

O’Rourke: “As you say, there’s a vast array of loans. And you don’t know which you’ll be getting. But do you go along with the view though, that those debtors, be they big commercial companies, it’s in their best interests to get those loans refinanced – in other words, not to have them transferred to Nama?”

Daly: “I think, from a commercial point of view, that most of those individuals or companies would certainly not want to come to Nama. And I think any of them, the more of them that can refinance themselves in the intervening period with the liquidator, the better. Some of them are already making efforts in that direction. Maybe, in a way, it’s a backhanded compliment to Nama that they don’t want to come near us.”


O’Rourke: “What is the situation with the legal actions? IBRC has been involved in several. Will they continue? Or be continued with the same vigour and rigour by Nama, when you take them over?”

Daly: “Well I think we have to see what we take over because, obviously, the legal actions will follow the individual debtors that come to Nama but, again, I would make the general point that our approach to any IBRC debt that comes to Nama is going to be exactly the same approach that we have applied up to now, that is rigorous pursuit that’s in the interests of the taxpayer.”


(Laura Hutton/Photocall Ireland)

Frank Daly spoke with Matt Cooper of Today FM on the Last Word yesterday. The Nama chairman robustly defended the performance of the secretive ‘bad bank’ and those six figure payments to bust property developers. It’s a long transcript but worth a read.

Matt Cooper: “How much has NAMA changed from what it was originally set out to do?”

Frank Daly: “It hasn’t changed at all in relation to the fundamentals. The fundamental objectives of the agency, you mentioned yourself, it was designed to take all those bad loans, the land and development loans off the banks and we have done that. That’s been our first major task. Something like 16,000 loans, totalling, on the book value about €74 billion, which is a massive amount of money. We took those off the banks’ books. We cleansed the banks’ balance sheets of that dross. And that was our first and main job of work, which I think we’ve done quite successfully. Our task now and our task for some time has been to actually manage those assets, manage the loans, manage the collateral behind them. To get the best possible outcome for the Irish taxpayer and that’s what we’re focussed on, right now. And that’s a mixture of, you know, selling assets and of managing those assets and in some cases actually, investing in those assets – so we do get a better return over the remaining nine or so years that are left for NAMA to do that.”

Continue reading →

Nama Wine Lake has combed over Nama chief Frank Daly’s speech yesterday for clues as to what is happening at the (state-owned) largest property company in the world.

Nuggets include:

(1) From March 2010 to date, NAMA has made 6,000 credit decisions. That’s an average of 60 per week or 12 per working day. And each decision is made within an average of six days.

(2) NAMA has “agreed” more than 600 developer business plans representing 95% of the Agency’s total loans, by value.

3)NAMA has approved advances to developers of nearly €1bn. Now this isn’t news but separately NAMA says that developers are expected to grant charges over €500m of unencumbered assets, and to date developers have granted charges over €221m of unencumbered assets. NAMA is not saying if these two facts are connected…Separately NAMA says that it has reversed €160m of spousal transfers.


More here: NAMA Is Making 12 Credit Decisions Every Working Day – Chairman Provides Update on Agency’s Progression (Nama Wine Lake)

(Laura Hutton/Photocall Ireland)



“I do not have to tell you how absurd your negotiating position would become if the parties with whom you are negotiating had full sight of your hand of cards. This would be commercial madness,” he [Nama chief Frank Daly said.



This could be significantly worse than our previous worst imaginings.

Ireland’s NAMA Sees Property Prices Stabilising (Reuters)

(Laura Hutton/Photocall Ireland)

July 2010:

The head of the National Asset Management Agency said he was “extremely disappointed and disturbed” that information provided to the agency by bailed-out banks “has not stood up”. The stinging criticism of the banks from NAMA chairman Frank Daly (above) came as he revealed that the agency was likely to make profits of just €1bn over the next 10 years and could lose as much as €800m in the “worst-case scenario”. That is a far cry from the previous projection of profits nearing €4.8bn.

Fionnan Sheahan: Tough Talk Isn’t Enough: We Need To See Payback (Irish Independent, July 12, 2010)

July 2011:

The National Asset Management Agency (Nama) recorded impairment charges of almost €1.5 billion last year, its annual report has revealed.

The agency made a operating profit of €305 million for the year, but impairment losses were €1.485 billion for the 12-month period.

Nama posts €1.1 billion loss for 2010 in annual report (Irish Times)


(Photocall Ireland)