Nama boss Brendan McDonagh

NAMA will submit a revised business plan to the Department of Finance this week that may see it lower its forecast for how much it expects to recoup when it is eventually wound up.

The agency's draft business plan, published last October, forecast it would recover €4.8bn for taxpayers when it wraps up its work in 2020.

However, that projection was based on a 30% average discount being applied to the loans it was taking on and that 40% of them would be producing cash flow. The overall amount of loans being taken on by the agency has risen to €81m from €77bn.

The discount on the first batch of loans going to Nama has shot up to 50% and the agency said in April that about two-thirds of the loans weren't paying any interest. That would indicate that Nama may find it difficult to achieve its target.

A market source told the Sunday Tribune that, while the haircuts have been greater than forecast, the agency has benefitted from lower costs, with the various providers of accounting, loan management, legal and banking advice all coming in lower than estimated.

The agency said in its draft business plan that it would spend €2.6bn on these services over its lifetime.

Another important variable in determining whether the agency will eventually make a profit is how many of the loans default.

It originally assumed that €16bn of the €77bn of loans would default.

"The business plan will take account of the actual data now available to it arising from the transfer of the first tranche of loans," finance minister Brian Lenihan told the Dáil last week.

The government has said that if Nama makes a loss at the end of its life, any deficit will be recouped from the banks by means of a surcharge.

The agency's chairman, Frank Daly, said earlier this month that the haircut on the second tranche of loans it takes on may not be widely different from the 50%.

The €13bn of loans is due to move over to Nama in July and is set to follow the same pattern as the first tranche, with not all the loans moving at the one time.

The loans should have moved to the agency in June but the process has been delayed because of the amount of work involved.

Nama will also produce its first quarterly report this week.