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IBRC Special Liquidation update – Expected repayment of the outstanding borrowings to NAMA under the Facility Deed and the withdrawal of NAMA as a bidder in the liquidation

The Special Liquidators of Irish Bank Resolution Corporation Limited (in special liquidation) have confirmed to the Minister for Finance that they now expect that the proceeds from the sale of IBRC assets will be sufficient to fully discharge the outstanding secured debt owed to NAMA without requiring that a portion of that debt be discharged by a transfer of assets from IBRC to NAMA.

As part of the Promissory Note transaction NAMA was required to issue €12.9bn of Government Guaranteed NAMA Bonds to the Central Bank of Ireland in exchange for the debts outstanding by IBRC under the ELA Facility Deed. This debt is now expected to be repaid in full by the Special Liquidators and remaining proceeds from the liquidation will be available to remaining creditors of IBRC (of which the State is the largest).

Given the success of the sales process to date the transfer of assets to NAMA as part of the Special Liquidation is no longer required. The Minister has, therefore, decided to withdraw the existing direction to NAMA to acquire assets from the Special Liquidators. As a result no assets are now expected to transfer to NAMA at the independent valuation price and the Special Liquidators will be required to devise and manage a sales process in relation to all the remaining assets in IBRC in a manner that maximises the return to all remaining creditors of IBRC (including the State).

The Special Liquidators will, in the coming weeks, contact borrowers whose loans were not sold in previous loan sales processes to update them on the Special Liquidators’ plans for the sale of the residual loans.

Commenting on the full expected repayment of the NAMA Facility Deed, the Minister for Finance said:

“This is a very successful outcome for the taxpayer and reinforces the decision taken to resolve the promissory note arrangement last year. All debt outstanding to NAMA as part of the promissory note transaction is now expected to be repaid in full. This means that no further assets will require transfer to NAMA thereby finally breaking the link between the State and the former Anglo Irish Bank.

The level of market interest in the assets of IBRC and the sale of over 90% of the loan book to third parties to date has removed the need for NAMA to acquire assets as part of this process. The Special Liquidators will continue to manage the wind down and liquidation of the remaining assets of the bank.”