Chambers Ireland Statement on the National Asset Management Agency

ECB Support Proof Positive of Ireland’s Need to be at the Core of Europe

Chambers Ireland has today (10/09/09) said that while other methods of solving our financial issues may have merit, we no longer have the time to debate them.”

Ian Talbot, Chief Executive, Chambers Ireland, said “NAMA is Ireland’s version of the quantitative easing strategy already undertaken in the UK, USA and elsewhere as a means of stimulating their economies. Our Government does not have the money available to provide such a direct stimulus making this strategy necessary due to the compelling need for action. Recent improvements in spreads on Irish Government debt in the international Credit Default Swaps market indicates market acceptance of the direction proposed.”

“NAMA will effectively involve the Government issuing ‘IOUs’ to Irish banks in return for distressed assets. The IOUs will then be used as collateral for new funding that will be issued by the European Central Bank (ECB). This money will play a crucial role in providing new liquidity into the Irish economy which in turn will underpin new transaction and market activities in Ireland. The ECB’s willingness to invest in and support our financial system at this time is proof positive of our need to be at the core of Europe and underlines the need for a Yes vote on Lisbon to sustain our position,” he said.

“In the context of the debate on long-term economic valuation methodologies, we note that one consequence of quantitative easing is a risk of inflation in the medium term. Over time this should contribute to the reduction in real Government debt associated with the asset transfer process to NAMA. Finally, we urge that all appointments under this legislation conform to standard Government tendering procedures to contribute to transparency.” Talbot concluded.