Nama staff to be subject to six-month notice period

Staff joining the National Asset Management Agency will now be subject to six month notice periods to prevent any potential conflicts of interest arising when they choose to leave the agency.

This emerged today at a hearing of the Committee of Public Accounts, where Nama chief executive Brendan McDonagh gave a presentation on the agency’s operation and its 2012 annual report.

Nama staff are currently required to give three months notice to the agency when they leave. Under new provisions being set down by the National Treasury Management Agency, which employs Nama staff and then seconds them to the agency, this timeframe is now to be doubled.

Sinn Féin TD Mary Lou McDonald said the “cooling-off” period should have been 12 months to avoid a situation where a Nama staff member would use their “insider” knowledge of the agency’s workings to their benefit in a new employment.

Nama chairman Frank Daly said it was not possible to prevent people from moving employment and that the board of Nama felt it has the balance right in terms of notice periods and their obligations under the Nama legislation and the Official Secrets Act.

“I don’t think Irish taxpayers would thank us for paying people to sit at home for 12 months,” he added.

Mr McDonagh said Nama is aiming to break even by the time it winds up in 2020 and expects to pay down its €30 billion in senior debt in full by that time.

It believes that about €900 million worth of land, outside commuter belts, would be left over when it winds down in 2020. Mr McDonagh said it would then be up to the Government what to do with the land but he didn’t feel it would be worth extending Nama’s lifetime to deal with this “rump”.

The National Asset Management Agency and its debtors and receivers have sold more than 2,000 individual properties in Ireland and are currently actively seeking buyers for Irish residential and commercial property worth about €1.5 billion.

Nama chief executive Brendan McDonagh told the Public Accounts Committee today

that the agency will redeem €750 million of its senior debt next week.

This will bring to €7 billion the amount redeemed by Nama so far from the €30 billion in senior debt that it held at inception.

Mr McDonagh said Nama faces “potentially serious consequences arising from the scale of staff turnover and the quality and experience of departing staff”.

He said it was an “uphill battle” to retain specialist staff who were being offered better paid positions in other areas of the property and banking sectors.

The Nama chief said the agency made a profit in the first half of 2013 and will provide €10 million in funding by the end of this year for the provision of 600 social housing units.

On the potential transfer of loans from the special liquidators of Irish Bank Resolution Corporation, Mr McDonagh said Nama could end up acquiring a portfolio of commercial loans with par value of €20 billion.

He said this would represent a “major challenge” for Nama as the number of commercial debtors managed by the agency could rise from about 800 currently to more than 3,000.

“That does not include over 13,000 mortgage holders whose loans - aggregating to par debt of €1.8 billion - may also transfer to us if the residential portfolio is not sold by the liquidators.”

He said Nama will need to recruit 180 to 220 additional staff to deal with the IBRC loans.

Mr McDonagh said this would be challenging, especially as Nama has already lost 10 per cent of its staff so far this year as employees have been poached by private sector groups.