Proposal to cut 40 jobs at NTMA ‘surprising’

THE Bord Snip proposals to axe 40 staff at the National Treasury Management Agency (NTMA) to bring about savings of €5.3 million took some commentators by surprise.

NTMA is to have a central role in the proposed bad bank to be known as the National Asset Management Agency (NAMA) and it has already said it would require further staff to carry out its new functions, that are still being determined by the Government and Finance Minister Brian Lenihan.

Mr Lenihan is directly responsible for the proposed National Asset Management Agency and is expected to publish the bill to pave the way for the setting up of the bad bank shortly.

At a recent appearance before the Dáil Committee of Public Accounts, NTMA chief executive Michael Somers warned the creation of the National Asset Management Agency (NAMA), which will acquire toxic loans of up to €90 billion from the banks, could pose all sorts of problems for the state and his organisation. On a practical level he said the agency was entering unchartered waters.

He pointed out that his organisation was understaffed to deal with the challenge of running NAMA or to even contribute adequately to solving the current banking crisis.

It is expected that the new bank will insist that the assets acquired by the taxpayer will be written down by at least 20%, to reflect the slump in land values and the poor nature of the lending involved.

Dr Somers said the Government was facing “an appalling dilemma”, given the scale of development loans advanced by the banks was “enormous”.

Apart from warning that the toxic bank could face serious legal challenges Dr Somers made clear that more staff were needed to deal with the problems posed by the bad bank proposals.