NAMA to consider buying loans from Irish units of foreign-owned banks

THE National Asset Management Agency (NAMA) will consider buying loans from Irish units of foreign-owned banks under the country’s “bad bank” scheme, the Department of Finance said yesterday.

The “bad bank” law to be published this summer will focus primarily on six Irish-owned banks covered by Dublin’s state guarantee for bank liabilities. But NAMA will consider buying assets — ranging in quality from well-performing to soured loans — from other banks operating in Ireland, a spokesman for the department said. He could not confirm a newspaper report that NAMA officials had met executives from Ulster Bank, part of the Royal Bank of Scotland Group, and the Irish unit of Belgian banking and insurance group KBC, and were expected to meet Danske Bank’s National Irish Bank.

Halifax and Bank of Scotland (Ireland), parts of Lloyds Banking Group, have also provided syndicated development loans in Ireland and could thus be eligible, the newspaper report said.

KBC said its Ireland unit did not have significant exposure to real estate development finance — about 620 million, or 3% of KBC Ireland’s total assets.

Bank of Scotland (Ireland) declined to comment. An Ulster Bank spokeswoman said it would reply later, as did a spokesman for National Irish Bank.

NAMA will consider buying loans from foreign-owned banks on a case-by-case basis if they have Irish property developer customers who also drew loans from Irish banks taking part in the “bad bank” scheme.

The agency was set up to take over up to 90 billion in risky property loans and assets currently clogging up the Irish banking sector.

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