THFC Introduces £2b Green Funding for Homes
The Housing Finance Corporation (THFC) has launched a £2 billion financing mechanism aimed at assisting housing associations in achieving their sustainability targets for both new and existing properties.
Standard & Poor's (S&P) has given THFC Sustainable Finance (TSF) a stable outlook with 'A' long-term and 'A-1' short-term ratings. This rating reflects the creditworthiness of the £8.4bn group and its status as the primary aggregator for the UK social housing sector.
THFC finalised the documentation for its new subsidiary's £2bn EMTN programme. The programme will concentrate on issuing sustainability bonds and bonds that use sustainable proceeds to finance investments in both new and existing homes, including retrofitting.
THFC's commitment to Environmental, Social and Governance (ESG) will be strengthened through this initiative, as core THFC issuance will integrate key pillars from the Sustainability Reporting Standard for Social Housing, the ESG standard in the sector.
TSF's availability offers clients more flexibility, as it is the only aggregator able to issue through multiple funding vehicles that are rated by both Moody's and S&P. HAs will have access to the capital markets in smaller amounts and the option of deferred drawdowns, with TSF providing the same competitive terms as THFC's bLEND subsidiary, which has a value of £1.47bn.
According to S&P, TSF is a crucial and integral part of the THFC group. The agency expects TSF to continue as a leading social housing bond aggregator in the UK, with management practices that will help THFC maintain a strong financial risk profile.
THFC Sustainable Finance is a wholly-owned subsidiary of T.H.F.C. (Services) Ltd, the group's primary operating entity.
Fenella Edge, the group treasurer at THFC, stated that launching a new programme with an A stable rating, alongside the bLEND programme, rated A2 by Moody's, provides two highly rated vehicles. Both programmes will issue under THFC's robust sustainability framework, making them attractive to investors and clients and setting them apart.
Arun Poobalasingam, head of relationship management and business development, remarked that as the sector looks for ways to address the UK's affordable housing shortage, both by developing new supply and investing in existing homes, THFC will continue to create funding solutions that can help them achieve this goal.