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Major housing association L&Q has agreed a one-year extension to its £125m revolving credit facility with Lloyds Bank.
The 110,000-home social landlord also worked with the bank to transition more than £500m of its debt finance onto the Sterling Overnight Index Average (SONIA) interest rate benchmark.
SONIA, which calculates interest rates based on transactions from the previous day, will replace the London Interbank Offered Rate (LIBOR) at the end of the year, and several housing associations have completed SONIA-linked deals in anticipation of this in recent months.
L&Q said its credit facility will support its new five-year strategy, which will prioritise building safety while continuing to develop much-needed new homes across Britain.
In a recent interview with Inside Housing, Fiona Fletcher-Smith, the new chief executive of L&Q, said the organisation will cut its housebuilding target by 70% to deal with rising building safety costs.
Commenting on the extended credit facility, Martin Watts, director of treasury at L&Q, said: “Over the past year we have shown that L&Q’s financial strength, stability and diverse leadership enable us to be agile and responsive to market conditions. Our new five-year strategy gives us the flexibility to prioritise safety, quality and jobs, while retaining ambitious long-term goals to tackle the national housing crisis and climate agenda.
“To be able to do so with Lloyds Bank by our side will be hugely beneficial to the 250,000 residents who live in our homes and neighbourhoods. It also stands us in good stead as we look to develop and implement an environmental, social and governance financial framework.”
Ray Tierney, relationship director (housing) at Lloyds Banking Group, said: “Having worked with the team at L&Q for more than 20 years, we continue to see it make a difference to the lives of those people it serves and ultimately help Britain get a home.
“The new five-year strategy set out by its executive team is testament to that and we look forward to seeing the impact our funding supports.”
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