Document Type

Case Study


After the Irish property boom peaked in 2007, Ireland’s banks faced declining share prices and increasing liquidity pressures. When in the aftermath of the September 2008 collapse of Lehman Brothers, Ireland’s banks lost access to liquidity from abroad, it triggered a banking crisis in the country. In spite of various responses by the Irish government, the financial viability of Ireland’s banks (as well as the government’s fiscal position) continued to deteriorate in early 2009. The Irish government attributed the problem to impaired real estate assets sitting on bank balance sheets, which made it difficult for markets to believe that government’s upcoming capital injections would render the banks solvent. In response, the government created the National Asset Management Agency (NAMA), a majority privately owned asset management company (AMC), to remove these assets from the banks. The ownership structure was complex, being nominally privately owned so that NAMA would not appear on the government balance sheet. Most of the powers and benefits from ownership were structured so that they would accrue to the state.From its establishment under the NAMA Act on December 21, 2009, NAMA purchased assets with a face value of approximately €77.4 billion for €31.7 billion. As of December 31, 2018, it had disposed of all but €2.3 billion of these assets. NAMA was considered one of the best performing AMCs of the era and enjoyed an expansive legal mandate, but it was not sufficient to solve Ireland’s economic woes.Although NAMA was still operating as of 2019, it was projected to wind down by 2025 (having submitted a detailed wind-down plan by the end of 2021) and yield a profit of €4 billion.