By Gavin Morris
Two thirds of loans acquired by the National Asset Management Agency (NAMA) are not yielding any interest it was revealed yesterday.
Borrowers are paying interest on €27 billion of the €81 billion in loans purchased by the agency and not €32 billion as first predicted.
Brendan McDonagh, chief executive of NAMA, told an Oireachtas committee that he will be forced to send bulldozers in to level some unfinished estates, incurring further costs for the agency.
“We can all see land and half-built developments which should never have been contemplated as it is hard for anyone with an objective view to see how they made sense even at the top of an over-heated market,” said Mr McDonagh.
In a strongly worded attack, Mr McDonagh accused banks of “chasing the dragon” during the decade long property boom. Painting a damning picture of shoddy business practises, Mr McDonagh accused banks of falling over themselves to advance loans to property developers in a “mindless scramble to funnel lending into one sector at considerable pace and of a reckless abandonment of basic principles of credit risk and prudent lending”.
Mr McDonagh disclosed to the Oireachtas Joint Committee on Finance and the Public Service that 12.5-15 per cent of the first €16 billion in loans included rolled-up interest, loans where the borrowers had not made any repayments. The agency will stop interest roll-up once their contracts expire. Based on the first transfers, Nama expects to pay a total €43 billion for all loans, compared with the €54 billion estimated last year.
Mr McDonagh said that NAMA would submit a revised business plan by the end of June.
Labour finance spokeswoman Joan Burton said she found it “very strange” that NAMA could not submit a revised business plan earlier given that the agency had now learned the extend of the problems.
Fianna Fáil TD Michael McGrath,who chaired the comittee said that the revelations were ‘shocking’.
400 DEAD IN CHINA EARTHQUAKE
By Kevin Donnellan
At least 400 people have been killed and approximately 10,000 injured following an earthquake in the Qinghai province of China today.
A series of six shocks, reaching 6.9 on the Richter scale, caused the widespread collapse of buildings in the ethnically Tibetan region of the country. Many people are still trapped in demolished mud-brick buildings.
State television has shown local military personal searching through rubble for survivors with their bare hands.
The epicentre of the quake was in Yushu County, located in a mountainous region between the borders of Tibet and Qinghai, 480 miles away from the provincial capital, Xining.
Approximately 5,000 specialist quake rescuers are now travelling to the region from neighbouring provinces.
Karsum Nyima, a local media figure, said: “In a flash, the houses went down. It was a terrible earthquake. In a small park, there is a Buddhist tower and the top of the tower fell off.”
He continued: “Everybody is out on the streets, standing in front of their houses, trying to find their family members.”
One local resident, Talen Tashi, told Reuters: “Certainly there have been people hurt. Rescuers are trying to pull them out. A lot of one-storey houses have collapsed. Taller buildings have held up, but there are big cracks in them.”
Many residents are fleeing to the surrounding mountains amid concerns that a nearby dam is close to bursting.
State media has reported that the local reservoir was currently being drained as a crack had appeared in the dam.
Earthquakes are a common occurrence in this region of China but the sparse population has ensured that casualties are a rarity. Experts have confirmed that this is the biggest quake to hit the region since at least 1900.
Official figures put the population of Yushu County at approximately 79,000. In 2008 a quake in the nearby Sichuan region left an estimated 90,000 dead or missing.
SIPTU WARN: "CONSULTATION HAS JUST BEGUN"
By Sean Duffy
Ireland’s largest workers union SIPTU have stated that the talking “has just begun” regarding the public sector pay deal, which was endorsed by its executive committee earlier this week.
Attention will now focus on the 70,000 members who will vote next month on whether to accept or reject the government proposals.
The agreement, which was negotiated between union leaders and government officials at Croke Park, has been the subject of controversy and division among unions.
The Teacher Union of Ireland and the Irish Nurses and Midwives Association have criticised the deal, and have asked their members to vote down the proposals. However, Frank Connolly, director of communications at SIPTU, warned that the endorsement was merely the beginning of the process.
“The National Executive committee of 35 members voted to endorse this deal by majority. However we won’t be speculating on how our members may react to this. The consultation process has only begun now. There will be an extensive consultation with members, who will ultimately voice how they feel” he said.
“The executive committee endorsed the deal, believing on balance that it is the best deal for our members. We’re not happy about things, but also have to be realistic about the times we live in.” Mr Connolly added.
Mr Connolly also said that ill-feeling towards the current Government could hinder ratification of the Croke Park proposals.
“This government has broken two previous pledges with regards to pay cuts. So naturally there is an absence of trust and goodwill from our members. They don’t trust this government.” He stated.
There have been concerns among the unions that the Government may implement pay cuts and mandatory redundancies, if economic conditions were to worsen in the country.
“Under clause 28 there is a provision for the Government to change the terms of this agreement. However included in that clause is scope for the unions to resume or escalate industrial action, so it works both ways.” Mr Connolly warned.
Irish aim to put themselves on the map
By Blaithin Henehan
Seven Irish historical sites have been entered by the government as nominees for the United Nation’s World Heritage list.
Among the nominated sites is the Clonmacnoise monastic city, the Burren, the ‘historic’ city of Dublin, Céide Fields, Georgian Dublin and its literary tradition, the Hill of Tara, the monastic sites of Durrow, Glendalough, Kells and Monasterboice, and finally the Rock of Cashel.
The caretakers of these historical sites are hopeful they might join the already established world heritage sites of Newgrange, County Meath, the Seventh Century monastic complex of Skellig Michael, which is 12km off the County Kerry coast and the Giants Causeway, County Antrim.
Minister for the Environment, John Gormley, stated that the ‘historic’ city of Dublin was entered “ not only because of its architecture, but also for the city’s extraordinary contribution to world literature”.
There are 900 sites on the world heritage list including the Great Barrier Reef in Australia, the Great Wall of China and Red square in Russia.
It is likely that the official nominations for the list will be decided in Brazil in July.
