Lenihan Tough On NAMA Bankers' Errors

Banks have been less than clear on certain aspects of the running of the National Asset Management Agency (NAMA).

Daíl Minister for Finance Brian Lenihan has now promised action against banks that provide "misleading information" but insisted that NAMA had done its job, and actually paid the banks less than had been envisaged.

His comments come after yesterday's publication of NAMA's business plan that showed a lower number of loans are producing income for the agency than had been outlined in the original business plan.

Speaking on RTÉ's Morning Ireland, Mr Lenihan said the government had never relied completely on information from the banks and said those who knowingly gave false information to NAMA could face criminal prosecution.

"It's written into the legislation that if there's any misleading statements by bankers that they commit a criminal offence," he said.

"If evidence of that were to materialise, NAMA could put it in the possession of the prosecuting authorities and deal with the banks accordingly."

The revised business plan yesterday showed that the agency could lose €800 million in the worst-case scenario - but this shortfall would be covered by a levy on banks, Mr Lenihan said.

The agency said it expected to make a profit of €1 billion, but should economic conditions improve, this total could reach as much as €3.8 billion - despite an earlier draft business plan in October estimating NAMA would make €4.8 billion profit.

Mr Lenihan denied that there had been an "endless deterioration" in NAMA's figures, and said these the difference in the profit forecasts between to the two business plans was explained by the earlier version being based on information supplied by the banks themselves.

"We didn't rely on that information [for the revised plan], we didn't take any decisions on foot of that information; we simply gave an indication of what we believed the state of play was at that stage, and at that stage we believed Nama could yield a profit of several billion," he said.

"It now appears NAMA are confident they will make a profit of a billion. The key point here is that we didn't rely on the figures, we didn't trust the banks. We weren't hoodwinked by the banks."

(BMcC/KMcA)