Fears grow over delays to Ireland’s bad bank scheme

City A.M. Reporter
IRELAND’S “bad bank” scheme faces further delays as European Union approval is not expected until the end of February at the earliest, Dublin banking sources said yesterday.

An Irish finance ministry spokesman said he had no comment to make on the problems faced by the scheme.

Earlier this month, Irish government officials said they were confident the National Asset Management Agency (NAMA) would have by February the approval needed to allow it to buy risky property loans with a combined book value of £69bn between February and the third quarter.

Originally, the aim was for NAMA to buy loans totalling €77bn (£66.9bn) from December to mid-2010.
A major deadline for NAMA is March 30, the last day of the Bank of Ireland’s financial year.

The delays are expected to add weeks to the planned timescale for transferring loans, which had been scheduled to begin by February 12. The agency cannot acquire any assets before approval for the scheme and for an overall bank restructuring programme is secured from the European Commission.