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FINANCE FOR RESIDENTIAL SOCIAL HOUSING PLC - NOTICE OF SEPARATE ADJOURNED SENIOR NOTEHOLDER MEETINGS

LIBOR TRANSITION RELATED NOTICE OF MEETING EVENTS


03 MARCH 2023


Full announcement available via prnewswire


Series 1 Class A1 Asset Backed 8.369 Per Cent. Premium Yield Notes due 2058

(Common Code: 7518471; CUSIP Number (for 144A Notes): 31737RAA3; CUSIP Number (for Reg S

Notes): G34346AA7; ISIN: USG34346AA77)

(the "Series 1 Class A1 Notes")


Series 1 Class A2 Asset Backed 8.569 Per Cent. Premium Yield Notes due 2058

(Common Code: 7518498; CUSIP Number (for 144A Notes): 31737RAB1; CUSIP Number (for Reg S

Notes): G34346AB5; ISIN: USG34346AB50)

(the "Series 1 Class A2 Notes")

and

Series 2 Class A Asset Backed Variable Rate Notes due 2058

(Common Code: 7518536; CUSIP Number (for 144A Notes): 31737RAE5; CUSIP Number (for Reg S

Notes): G34346AE9; ISIN USG34346AE99)

(the "Series 2 Class A Notes")


"The meetings of the holders of the Series 1 Class A1 Notes, the Series 1 Class A2 Notes and the Series 2 Class A Notes were adjourned for want of a quorum."


...


"Background


Since July 2017, there has been a concerted and intensive global regulator-driven effort to encourage, an ultimately effect, the transition away from the use of interbank offered rates, including the GBP London Interbank Offered Rate ("LIBOR"), in financial instruments to risk-free rates or other appropriate benchmarks (the "Transition").


The UK Financial Conduct Authority ("FCA") has confirmed that it will no longer persuade or compel banks to submit rates for the calculation of the LIBOR benchmark after the end of 2021 and expects that some panel banks will cease contributing to LIBOR panels at such time. In addition, the Bank of England and the FCA announced that a working group has been mandated to promote a broad-based transition to the Sterling Overnight Index Average ("SONIA") across sterling bond, loan and derivative markets, so that SONIA is established as the primary sterling interest rate benchmark by the end of 2021.


On 16 January 2020 the Bank of England and the FCA have stated that LIBOR "will cease to exist after the end of 2021" and that "no firm should plan otherwise". Furthermore, the UK RFR Working Group's "Priorities and roadmap for transition by end-2021" specifies Q1 of 2021 as the target date for the ceasing of the "initiation of new LIBOR-linked loans, bonds, securitisations and linear derivatives that expire after the end of 2021".


The FCA announced on 5 March 2021 that all LIBOR settings will either cease to be provided by an administrator or no longer be representative of the underlying market and economic reality (and that representativeness will not be restored) immediately after (i) 31 December 2021, in the case of all sterling, euro, Japanese Yen and Swiss Franc, and certain US dollar settings; or (ii) 30 June 2023, in the case of the remaining US dollar settings. Regulators have continued to urge market participants to take active steps to implement the transition of SONIA and other risk-free rates ahead of the applicable LIBOR cessation date.


The Issuer has convened each Adjourned Meeting for the purpose of enabling the Senior Noteholders to consider and resolve, if they think fit, to approve the Noteholder Proposal by way of an Extraordinary Resolution separately in relation to each class of the Senior Notes implementing certain amendments to the Liquidity Facility Agreement as described herein.


Due to the differences in the nature of LIBOR and SONIA, the replacement of LIBOR as the reference rate for the calculation of interest on each Drawing under the Liquidity Facility Agreement will also require the addition of a spread ("Spread Adjustment") to the existing Margin payable in respect of such Drawing.


The Issuer has discussed the Noteholder Proposal with Moody's Investors Service Limited ("Moody's") and S&P Global Ratings ("S&P"). None of Moody's or S&P has, based on the information provided to them, raised any comments in respect of the Noteholder Proposal."

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