Ireland's banks are hoping the Liam Carroll group of companies can survive until the setting up of Nama – as they believe the new state agency will pay them more for their loans and assets than any returns likely to come from a liquidation of Carroll's firms.

As a result, the banks are to seek discussions with Dutch-owned lender ACC this week.

However, ACC has been instructed by its Dutch parent Rabobank not to extend any further credit to its major property development customers and to seek re-payment of existing loans as soon as possible, the Sunday
Tribune has learned. The bank has declined to comment on its Irish credit practices.

Six companies controlled by Carroll have sought court protection from bank debts of €1.2bn. An examiner is likely to be appointed to these companies on 27 July. Meanwhile, Carroll's entire property empire is believed to have debts of more than €2.2bn.

ACC has been attempting to recover loans of €131m – despite the preference of the Irish banks to keep Carroll's property empire in operation.

The Irish banks, through their representatives, now hope to assess whether ACC would be prepared to support the appointment of an examiner and subsequently a scheme of arrangement.

The Irish banks are in a difficult situation. At this moment in time they don't know how much they might have to write their loans down by under a scheme of arrangement – but equally they have no knowledge of the price at which Nama will purchase property loans.

Liquidation of the Carroll companies cannot be ruled out, said a senior banker yesterday. The six Carroll companies owe AIB about €490m, but most other Irish banks also have large exposures.

The government yesterday said the issue of the survival of Carroll's companies was not relevant to the setting up of Nama. "Nama has been set up to protect the economy, not individual developers,'' said the finance department.

Banking sources said the most likely outcome was that an examiner would be appointed, possibly over the objections of ACC, and the companies, known as the Zoe Group, could continue, at least up until the creation of Nama.

While ACC can object to the appointment of an examiner and the scheme of arrangement, once the majority of the banks agree to the arrangements, a judge is likely to approve it, insolvency experts said yesterday.

The only way ACC can object is if it can prove that the scheme of arrangement is "unfairly prejudicial'' to its interests. The examiner will have to prove the companies have a reasonable prospect of survival, but many regard this test as reasonably low once the banks are on board.

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