TIDM14MC

Midland Heart Capital PLC

09 March 2020

Major Japanese finance deal shows Midland Heart means business

Leading UK housing association Midland Heart has established a reputation as an organisation to do business with globally, securing a GBP60m finance deal with a major Japanese bank.

The loan from Sumitomo Mitsui Banking Corporation (SMBC) follows news that Midland Heart had retained their A1 Stable credit rating from Moody's - one of only a handful of UK housing providers to achieve this rating.

Together, it demonstrates that social housing is increasingly viewed as a safe bet for investors worldwide who want to lend to an organisation that will provide good returns on their money.

Anna Simpson, Executive Director of Finance and Resources for Midland Heart, said: "We're thrilled to have retained our A1 Stable rating and secured this finance from SMBC, which will fund the development of high quality affordable housing across the Midlands.

"As a not-for-profit organisation that stays true to our social purpose of providing genuinely affordable homes, it's very important that we can borrow on the best possible terms and give our customers good value.

"It's encouraging that both Moody's and our new financial partner SMBC recognise the value of affordable housing as a product to invest in. Not only do our homes have guaranteed occupancy and offer a very stable income for investors, they also serve an important social purpose in providing much-needed accommodation for families across the Midlands."

In order to maintain their A1 Stable rating, Midland Heart needed to demonstrate continued financial discipline, which this year included posting their best ever operating surplus of GBP77m with an operating margin of 35%.

It went in the company's favour that they continue to focus on their core role of social lettings rather than developing for-sale properties, which are subject to market fluctuations and more of an investment risk.

During the most recent assessment period Midland Heart also launched a new corporate plan - Making What Matters, Brilliant - which sets out the company's ongoing commitment to building new affordable homes, continually improving existing stock and providing excellent customer service, while striving to become an employer of choice.

ENDS

Notes to editors:

1. Midland Heart is a leading housing organisation, delivering homes and services across the Midlands that enable people to live independently. We own and manage 33,000 homes and are dedicated to providing decent, affordable homes combined with excellent services to over 70,000 customers. Founded in 1925, Midland Heart is a trusted not for profit organisation whose social purpose drives us to reinvest all surplus back into our customers, staff and homes. For more information visit www.midlandheart.org.uk

2. Midland Heart's financial statements, including the latest statements for 2018/19, can be read here: https://www.midlandheart.org.uk/about-us/how-we-are-performing/financial-annual-reports/

   3.   For more information contact Hannah Murdoch, Media & PR Manager, on 07500 089 496 or hannah.murdoch@midlandheart.org.uk

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

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March 09, 2020 07:01 ET (11:01 GMT)

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