Nama posts €102m profit for year to June

The National Asset Management Agency made a profit of €102 million in the first six months of this year, according to its latest quarterly accounts, published yesterday. This was almost double the €55 million surplus achieved in the same period of 2013.

The impairment charge for the six months to the end of June was €57 million, down from €385 million a year earlier. “This is clear evidence that Nama’s impairment is on a downward trajectory assuming current positive market conditions prevail,” the accounts state.

The cumulative impairment provision to the end of June was €3.6 billion, down from €4.1 billion at the end of 2013.

The report shows that Nama’s cash generation accelerated in the six-month period. It generated cash of €5.4 billion during the first half of this year compared with €2 billion in the same period of 2013.

“The increase in cash generation was largely driven by an increase in loan disposal activity of large-scale portfolio and loan transactions, in particular the Project Eagle and Project Tower transactions.”

Additional €1.5bn

Nama said it has raised an additional €1.5 billion in cash in the third quarter to bring the cumulative figure to €6.9 billion this year and €21.9 billion since inception.

Nama also redeemed €5.5 billion of its senior bonds in the first half of the year with an additional redemption of €1.5 billion in the third quarter. This brings the cumulative total to €14.5 billion or 48 per cent of its original senior bonds in issue.

The accounts show that, by the end of September, Nama had redeemed €12.8 billion of the senior bonds issued in respect of the acquisition of the Irish Bank Resolution Corporation loan facility deed and floating charge.

This leaves a residual balance on the bonds of just €100 million.

The carrying value of Nama’s loan portfolio at the end of June, net of the cumulative impairment provision of €3.6 billion, was €15.3 billion. This compared with €18.3 billion at the end of March.

The accounts show that Nama’s administration expenses amounted to €67.3 million in the first half of the year. This included IBRC integration costs of €3.4 million and legal fees of €3.2 million. Staff costs amounted to €20.1 million.

It also incurred a foreign exchange loss of €7.4 million. However, its profit for the period includes a tax credit of €27.5 million.

Nama incurred a net loss on the disposal of loans and assets of €140.8 million in the six months to the end of June.