# NAMA profitable in 2011



## Shawady (25 Jul 2012)

According to this story, Nama have made a profit in 2011, €247 million.

I'm just wondering is this money that the government would have factored in to it's annual income?

[broken link removed]


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## Sunny (25 Jul 2012)

Shawady said:


> According to this story, Nama have made a profit in 2011, €247 million.
> 
> I'm just wondering is this money that the government would have factored in to it's annual income?
> 
> [broken link removed]


 
No income there to count. Haven't seen the full report but I think €235m of that profit is a tax credit.


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## DerKaiser (25 Jul 2012)

From what I've seen NAMA have paid out about €30bn, made operating profits of €1.6bn (mainly from sales) and written remaining assets down by €2.7bn.

It's not bad I guess, given how far the market has fallen since NAMA began. 

Effectively the banks have suffered €40bn+ of losses on the NAMA portfolio, with NAMA losing about €1bn to date.


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## Chris (26 Jul 2012)

I would be highly skeptical of NAMAs valuations. They started buying assets 2 1/2 years ago and since then property valuations are down 30%. By DerKaiser's figures Nama has discounted by less than 10%. I simply do. It believe them


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## DerKaiser (26 Jul 2012)

Chris said:


> I would be highly skeptical of NAMAs valuations. They started buying assets 2 1/2 years ago and since then property valuations are down 30%. By DerKaiser's figures Nama has discounted by less than 10%. I simply do. It believe them


 
That's a good point, a lot of people don't believe them.

The haircuts imposed on the banks were of the order of 60%.  If the reality was that a 70% haircut should have been imposed, that would mean that NAMA would have overpaid by €8bn.

Whilst I think it is important that NAMA is not seen to make a massive loss, I see it as quite academic due to the fact that any additional haircuts imposed by NAMA would simply have led to the state having to cough up more capital to the banks out of state coffers.

In terms of honesty and facing up to inevitable losses, I think Ireland are light years ahead of many other countries (Italy, Spain, etc). Excessive prudence on NAMA's part would have been completely OTT and counter productive to recovery.

Ultimately, if you were to measure the performance of NAMA executives, they won't be judged on the market related performance rather their underperformance or outperformance relative to the market.  This comes down to operational efficiency (versus the banks) and the ability to leverage their market position to make good deals in disposing assets on behalf of the state.


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## Chris (26 Jul 2012)

Or maybe no state money should have gone in at all, it certainly hasn't provided anything that looks remotely like a recovery and in my opinion never will.


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## DerKaiser (26 Jul 2012)

Chris said:


> Or maybe no state money should have gone in at all, it certainly hasn't provided anything that looks remotely like a recovery and in my opinion never will.


 
Regardless of what people claim it is or isn't, it is nothing more than an asset management agency and should be judged accordingly.  You can't hold NAMA responsible for write-downs if the state had already committed to underwriting those banking losses.


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## runner (26 Jul 2012)

Im a layman on this issue, but it does appear that Nama has sold it best property assets ie UK ones mainly. Wait till we see how they do with whats left, them being local and on a diminishing scale of attractiveness and see where the profit line takes us to then.


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## joe sod (21 Dec 2022)

DerKaiser said:


> From what I've seen NAMA have paid out about €30bn, made operating profits of €1.6bn (mainly from sales) and written remaining assets down by €2.7bn.
> 
> It's not bad I guess, given how far the market has fallen since NAMA began.
> 
> Effectively the banks have suffered €40bn+ of losses on the NAMA portfolio, with NAMA losing about €1bn to date.


Just trying to get an overall perspective on how nama actually performed given that the media are reporting that overall they have a surplus of 4.5billion euros from all the assets that they managed.
They paid the banks 31billion euros consideration,  so does that mean they actually got circa 36 billion euros in total for those assets. 
Also the assets on the banks balance sheet were worth 75billion and a 40billion deficit or haircut was effectively pumped in .
Therefore it's the case I think that nama merely reduced the debt load from 40 billion to 35billion euros.
We shouldn't be getting too carried away with their surplus now. They effectively sold off most of the assets for rock bottom prices very early in the cycle and didn't manage the assets that well in the end.


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## NoRegretsCoyote (21 Dec 2022)

joe sod said:


> They effectively sold off most of the assets for rock bottom prices very early in the cycle and didn't manage the assets that well in the end.


No they didn't.

They didn't start selling their Irish portfolio in earnest until 2014 when the market was recovering.


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