Public bonds
- M&G buys housing association "own name" listed bonds
- Normally for larger amounts - M&G has the ability to place large orders
- Long-term debt, typically 25 to 30 years
- Fixed interest rate
- Amortising or bullet repayment
Private placements
- Syndicated private transactions, typically structured by a bank and offered to institutional investors
- Normally for amounts of £40m or more, M&G has the ability to place large orders
- Long-term debt, typically 20 to 35 years
- Fixed interest rate
- No requirement for an external credit rating
Bi-lateral private placements
- Private debt arrangement negotiated directly between M&G and the housing association
- Minimum amount from just £10m
- Long-term debt, typically 25 to 40 years
- Fixed or inflation-linked interest rate (or a combination of both) with transparent pricing
- Amortising repayment (with or without a capital holiday) or bullet repayment
- Competitive asset and interest cover covenants (no gearing covenant requirement)
- No requirement for an external credit rating
- Flexible drawdown (issuance) if required
- M&G uses proven, familiar documentation
Club deals
- Housing associations seeking to borrow smaller amounts (less than £10m) of long-term money on reasonable terms often find their choices extremely limited
- M&G is able to offer bi-lateral private placements (see above) where three or more housing associations "club" together to raise a critical mass of funds in excess of £20m
Shelf facilities
- Designed for housing associations seeking a "standby" bi-lateral private placement (see above)
- Documentation is executed, but with no obligation to issue
- M&G will quote a price if the facility is required, which the housing association can accept, or not.
