Only 12 days into the New Year, Affordable Housing Finance (AHF), the Government Guaranteed funding aggregator has brought its 12th bond deal to market with a £114.8M deal priced at Gilts plus 0.30%, the lowest credit spread achieved under the £1.5Bn Bond programme to date. The reoffered cost of the bond, at 2.24% was above the programme lows achieved at the end of 2016 (1.98% was the lowest) and reflected the rebound of the Sterling fixed income bond market as it reacts to geo-political factors and the probability that domestic inflation will rise over the coming months.
Although the transaction was smaller than previous tranches and tighter priced, it proved attractive to investors, finishing two times over-subscribed with a good mix of investors, including one central bank buyer.
The transaction was for two underlying southern housing association groups: Radian Housing Group and Bracknell Forest Homes.
Piers Williamson, Chief Executive of AHF said that ‘we had wanted to get to market as soon as possible in 2017. Given recent volatility and the build up to the expected European negotiations, we wanted to take advantage of still favourable market conditions, given the shortage of longer term Sterling issues and consequent good demand. Over the last 12 months, we have been able to issue over £750m of AHF bonds with a weighted average cost of 2.32%. That’s a fantastic benefit to the housing associations that have taken part, ultimately helping them to deliver more badly needed affordable homes’.
Privacy & Cookies Policy
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.