The Minister for Finance has reiterated that the National Asset Management Agency (NAMA) will take over performing as well as impaired development loans when it is established. He told the Dáil these will involve land and building projects that would include completed schemes. Performing loans are loans on which repayments are still being made.
Brian Lenihan told TDs that the methodology for valuing loans had yet to be decided, but that it could take into account the future value of property and loans under EU rules. He also confirmed that - in order to keep the agency's staffing as tight as possible - NAMA would not take over smaller loans below a cut-off point that had yet to be determined.
Fine Gael's Richard Bruton asked what political oversight of the valuation process there would be, and whether the operations of NAMA might effectively force the nationalisation of some banks. Mr Lenihan said the valuation methodology would be part of the legislation to be debated by TDs, but that he would not interfere in the actual process.
He also confirmed that the report of the body set up to look at public spending - dubbed An Bord Snip Nua - was with the printers after some textual problems had to be addressed. The Minister said he expected to receive the report later today.
Pressed on whether he would favour publication of the report, Mr Lenihan said he would express his opinions first to his colleagues in government.
Credit for businesses report to be published
The Minister for Finance has also told the Dáil that a report on credit availability to small and medium-sized businesses - initiated when Bank of Ireland and AIB were re-capitalised - had been received by the Government.
He said that between 24% and 30% of customers surveyed say they were refused credit, while banks say the refusal rate is just 14%. The difference arises from informal refusals to customers, compared with the formal refusals that the banks count for their figures. The minster also said that the value of new credit applications had fallen by 42%.
The report is being considered by the cabinet committee on economic renewal. The minister said it would be published shortly.
