The European Commission (EC) has approved Ireland's National Asset Management Agency (NAMA) under the European Union state aid rules. Anglo Irish Bank, Allied Irish Bank, Bank of Ireland, Irish Nationwide Building Society and Educational Building Society will be participating in the program, which will allow them to sell to the agency "assets whose declining and uncertain value is preventing the long-term shoring-up of the financial institutions' capital and, therefore, the return to a normally functioning financial market."
The program primarily targets loans for real estate assets, and is expected to acquire real estate and associated loans worth €80 billion for an estimated purchase price of € 54 billion.
The EC will assess the compatibility (and the actual transfer price) of the transferred assets when they are separately notified by the Irish authorities; these reviews will include a claw back mechanism in case of excess payments. The Irish authorities will also need to assure the EC that specific rights and exemption in the NAMA act will not affect normal competition in the market, and the participating institutions will need to submit restructuring plans aimed at "return[ing] those institutions to long term viability."