Latest: Mick Wallace calls on Government to halt further sales activity by Nama

Latest: Mick Wallace calls on Government to halt further sales activity by Nama

Update 6.22pm: Independent TD Mick Wallace said today that he believes the Commission of Investigation is the best way to proceed as the Government investigates Nama’s sale of Project Eagle.

Deputy Wallace, a long-time critic of the financial institution, also believes that Nama should halt further sales activity.

“Absolutely,” he said.

“And not only that … I believe it’s a mistake on the part of the Government to think that Nama should play a senior role in the housing crisis and tackle the housing crisis, where there’s plans for them to build 20,000 units.

“I think if the State is going to build those houses, it should be done in a different format – it shouldn’t be done by Nama.”

Update 5.34pm: Taoiseach Enda Kenny will meet Opposition leaders tomorrow to discuss the terms of reference for a further inquiry into the findings of today’s report by the State's spending watchdog into Nama.

Public Expenditure Minister Paschal Donohoe says further scrutiny of the sale of the Project Eagle loans is now needed.

“The matters that are being raised here today are of a level of significance that while we accept the Public Account Committee will undertake their work, we believe action from Government is also necessary, and that’s why we’re taking this action.”

Update 5pm: Northern Ireland’s Deputy First Minister Martin McGuinness backed calls for a cross-border investigation into Nama’s controversial £1.2bn sale of Project Eagle after today’s publication of a report from the Comptroller and Auditor General (C&AG).

"I think there is an unstoppable argument in the south for a very intensive investigation and of course many of us are arguing that is a much more effective investigation if it's done on an all-island basis," he said.

Latest: Mick Wallace calls on Government to halt further sales activity by Nama

Stormont First Minister Arlene Foster called for maximum transparency over the deal and argued that the National Crime Agency (NCA) probe should take precedence north of the border.

The Comptroller and Auditor General found Nama has losses of £162m on deals linked to Northern Ireland properties, the vast majority from Project Eagle.

Its audit found the deal was worth £1.137bn - with Nama having paid about £2bn for the loans.

The C&AG said there is no indication that Nama had considered a bulk sale of its Northern Ireland assets until US law firm Brown Rudnick wrote on behalf of US investment fund Pimco in June 2013 offering an exclusive deal.

Latest: Mick Wallace calls on Government to halt further sales activity by Nama

It found that two of Nama's valuations of its Northern Ireland loans in late 2013 and early 2014 underestimated their value.

The C&AG report also noted that Pimco withdrew from the bidding war in March 2014 after it told Nama about a "proposed success fee arrangement" involving Brown Rudnick, a Belfast law firm called Tughans, and a former member of Nama's Northern Ireland Advisory Committee.

Latest: Mick Wallace calls on Government to halt further sales activity by Nama

The £7m subsequently discovered in the Isle of Man was in an account controlled by a former managing partner of Tughans, Ian Coulter, who resigned after it was unearthed.

Tughans, which acted as a subcontractor for Cerberus's US lawyers, Brown Rudnick, insisted it was not aware of the transfer and all parties involved in the 2014 transaction have denied wrongdoing.

The C&AG found Nama dropped its reserve price in late March 2014 to £1.23bn and on April 1 that year Cerberus offered £1.241bn and the only other bidder, Fortress, offered £1.075bn.

Latest: Mick Wallace calls on Government to halt further sales activity by Nama

Update 4.13pm: The Board of the National Asset Management Agency (Nama) has “categorically rejected” the key conclusions reached by the Comptroller and Auditor General (C&AG) in its report on the sale of Project Eagle.

The Government today confirmed that the Public Accounts Committee would first examine the C&AG report into the affair before a formal inquiry is launched.

The report states that the loss to the Irish taxpayer was around stg£190m.

Latest: Mick Wallace calls on Government to halt further sales activity by Nama

"The Government's objective is to ensure that all matters of public concern are addressed in a speedy and effective manner," a spokesman said.

However, Nama claims that the report’s key finding is based on an “incorrect assumption” regarding the discount rate used to value the portfolio.

“It incorrectly assumes Nama should apply the same discount rate to this poor-quality loan portfolio as it applied to much higher quality assets in Dublin and London,” a Nama statement read.

“As a result the report overstates the estimated value of this portfolio.”

The statement adds: “The report’s conclusion that a better price could have been achieved is hypothetical and highly speculative. It produces no credible evidence to show any other buyer or group of buyers would have paid more than was achieved.”

Nama also pointed out that “contrary to some media reports in recent days, there are no findings of irregularities in the sale process”.

NAMA chairman Frank Daly added: “It is clear to us that, if NAMA had retained the Eagle portfolio, there would be no investor interest in buying it today – or in the foreseeable future – at anything close to the stg£1.322bn price that was actually achieved.

He stated that although Nama “has the utmost professional respect for the C&AG and his staff”, “regrettably, the key conclusions in this report are without the relevant loan sale market expertise and as such we have no option but regretfully to reject them categorically”.

The Project Eagle deal with US investment fund Cerberus in 2014 has been dogged by scandal for more than a year, including £7m linked to it being found in an Isle of Man bank account.

Project Eagle involved loans linked to more than 800 properties in Northern Ireland being sold in one lot to the New York investment firm which boasts former US vice president Dan Quayle in its ranks.

Taoiseach Enda Kenny offered to meet opposition leaders on Thursday to identify areas of public concern around the deal that need to be investigated and how that should be carried out.

There have been calls for a cross-border inquiry due to the limitations of parliaments in Dublin and Belfast and their inability to compel witnesses from other jurisdictions.

Project Eagle has been examined on previous occasions at the Public Accounts Committee in Dublin.

Investigations have also been launched into the deal by the UK's National Crime Agency, the US Department of Justice's Securities and Exchange Commission as well as a parliamentary inquiry in Stormont.

Sinn Féin president Gerry Adams described the offer of an inquiry as welcome but belated.

"Sinn Féin has consistently called for an inquiry into the sale of Project Eagle and at each turn the Government and Fianna Fáil have bizarrely sought to frustrate and delay it," he said.

Mr Adams called for governments and statutory agencies in the north and south to give maximum co-operation to the inquiry.

It is on course to make a more than €1.75bn profit on its deals by 2020 but has faced repeated questions over its handling of Project Eagle after Cerberus offered £1.241bn - just £1m above the reserve price.

Mr Adams alleged earlier this year under parliamentary privilege that a member of Nama's Northern Ireland advisory board offered to disclose information on the value of the portfolio to one bidder, US investment house Pimco, and demanded a £15m fee.

Project Eagle was valued by Nama at 27p in the pound, with some assets worth as little as 5p in the pound.

Earlier:

The Cabinet has agreed that further investigation of the sale of Nama's Northern Ireland loans is warranted.

A report from the Comptroller and Auditor General, to be published this afternoon, will say there was a potential loss of hundreds of millions of euro to the taxpayer.

Latest: Mick Wallace calls on Government to halt further sales activity by Nama

"The C&AG’s report raises a number of important issues which the Government acknowledges will require further investigation," a Government press statement read.

"The Public Accounts Committee is an appropriate forum for consideration of the C&AG report and for the exercise of public accountability in these matters.

"The Government expects that the PAC will wish to convene a public hearing at an early date. It would welcome such a public hearing and will offer any support that the PAC needs in the conduct of its inquiries.

"The Government also recognises that it has its own responsibilities to ensure that all matters of public concern with regard to the functions of an important public body such as NAMA are fully addressed.

"It has therefore decided that the Taoiseach will invite Opposition party leaders to meet him tomorrow with a view to seeking agreement on the issues of public concern that require further investigation and the most appropriate nature and terms of reference for such an investigation.

"Subject to the outcome of those discussions, the matter will then be the subject of a Dáil debate early in the new session.

"The Government’s objective is to ensure that all matters of public concern are addressed in a speedy and effective manner."

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