Nama to repay €500m of bonds

NAMA to repay €500m of bonds this week -> rte.ie/news/2011/0525/nama-business.html

NWL wonders why NAMA is redeeming money it is only paying 1.7% on and whether it could make a better return on deposit:
namawinelake.wordpress.com/2011/ … sh-is-1-7/

It is curious indeed as NAMA says it is going to fund 5 bn of development over its lifetime; it would surely make sense for it to do this with its cash pile?

I have a theory, one I don’t really like. I recall reading a few days ago that the banks had broken their liquidity limits a number of times, that is, they don’t have enough cash on hand to fund continuing operations. Could it be that the banks really need the cash? Surely it can only be a small amount different to the repo value (the haircut on NAMA bonds is quite low). Or perhaps having that small amount of cash rather than an asset out to repo is much more valuable?

Namawinelake’s observations on the matter here …
namawinelake.wordpress.com/2011/ … sh-is-1-7/

EDIT: Having an apostrophe night special …
Must be O’Bama related !!

Didn’t notice you’d posted the link there yogan … :wink: :stuck_out_tongue: