News & Announcements

11 Nov 2016

Herefordshire Housing agrees a staggered sale of £35 million retained bonds

Herefordshire has agreed terms for the immediate and future sales of its retained bonds, enabling them to continue to invest in communities in and around Herefordshire over the coming years.

The bonds, which were rated A2 by Moody’s Investor Services, are to be sold in instalments, with £5 million sold today and the remaining £30 million to be sold in four instalments up to the end of 2018.

The payment terms of the bonds were agreed on the pricing date, providing Herefordshire with certainty that future funding will be delivered at a known cost and on a particular date. Each sale was priced consistently, after a competitive process, at an attractive level.

Herefordshire was supported by Trowers as legal advisers and TradeRisks who advised on, arranged and placed the bonds. Pension Insurance Corporation agreed to purchase the bonds.

Peter Brown, CEO of Herefordshire Housing, commented, “We have an ambitious strategy to grow our housing stock by 1,000 by 2020 providing more homes in Herefordshire for those in need. This bond sale gives us the platform to increase the rate of development.”

John Coleman, Associate Director at TradeRisks, commented “This innovative transaction, delivered via a competitive bid process, has enabled Herefordshire to secure long term funding in an attractive market whilst managing its cost of carry, efficiently supporting its growth plan.”

Elizabeth Cain, Debt Origination Analyst at Pension Insurance Corporation, said: “We are delighted to work with Herefordshire Housing to help achieve its growth ambitions to deliver a further 330 houses. To date, PIC has invested over £600m in the social housing sector, and as a growing business we have further capacity to invest, in those HAs with a strong credit profile who have demonstrated their ability to respond to changes in the sector. The ability to offer a forward purchase of retained bonds is just one example of how we continue to work with borrowers to offer flexibility in funding structures.”

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