PAC says Project Eagle sales strategy was 'seriously deficient'

The committee says NAMA has been unable to show it "got value for money for the Irish State" from the sale

PAC says Project Eagle sales strategy was 'seriously deficient'

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The Public Accounts Committee has concluded that the sales strategy pursued by NAMA in the disposal of its Northern Ireland loanbook was "seriously deficient".

In its report on Project Eagle, the PAC says there was a "failure of corporate governance" by the agency in not removing advisor Frank Cushnahan as a consultant when disclosures of interest were revealed.

The committee also says it was "not procedurally appropriate" for the Minister for Finance Michael Noonan to meet with the successful bidder, Cerberus, the day before the closing date for the sale.

The report found that NAMA "incurred losses in respect of its Northern Ireland debtors" of €800m between 2010 and 2014 - including the loss of STG £162m (€185m) on the sale of Project Eagle.

Sean Fleming, chairman of the PAC, said: "It is the view of the Committee that the sales strategy pursued by NAMA included restrictions of such significance that the strategy could be described as seriously deficient.

"It is, therefore, the opinion of the Committee that NAMA has been unable to demonstrate that by pursuing such a strategy that it got value for money for the Irish State in relation to the price achieved."

"Part of the job of a Minister for Finance"

Michael Noonan has refuted 'certain findings' of the report.

In a statement, Minister Noonan said: “I refute absolutely the validity of any suggestion that I or my officials acted inappropriately in meeting with Cerberus in March 2014. At no point was I or my officials invited to discuss this meeting at the PAC nor was the alleged impropriety of this meeting raised in follow-up correspondence. 

"The note of the meeting with Cerberus is on the Department of Finance’s website and is clear in stating that any issue relating to NAMA should be raised directly with NAMA.”

He added: “It is entirely appropriate that I as Minister for Finance would meet with the Chairman of a major international investment fund, a former US Secretary of the Treasury no less, at his request whilst he was in Dublin on business. This is part of the job of a Minister for Finance."

He said he will review the report over the coming days and will make a 'full contribution' to the Dáil debate over it.

NAMA, meanwhile, stressed that it had co-operated fully with the PAC during the review process.

The agency said: "NAMA disputes the suggestion that an alternative monetisation strategy would have delivered a better financial outcome. NAMA also disputes the suggestion that an additional estimated £190m (£162m on sale conclusion) could have been realised from an alternative sales process."

A NAMA spokesperson added: “It was the Board’s commercial and considered judgement, in full knowledge of the financial implications, that the sale of the Project Eagle loan portfolio provided a better financial outcome than any alternative monetisation strategy. That was the Board’s view in 2014 and it remains the Board’s view today”.

Earlier, Sinn Féin's David Cullinane, a member of the PAC, called for a Commission of Investigation into the sale following the public of the report.

He said: “The failure of checks and balances regarding the sale of Project Eagle does not instil confidence in the sale of other NAMA property portfolios.

“Overall, the PAC Report into the sale of Project Eagle shows that we need to have a Commission of Investigation into NAMA. It is Sinn Féin’s view this should proceed as soon as possible.”