Centrus’ Co-founder and CEO, Phil Jenkins took a trip down memory lane in City AM‘s ‘Square Mile and Me’. From his first role at Hambros Bank to co-founding Centrus, Phil highlights the proudest moments in his career, his love for the City, and vision for the future of finance.
Click here to read the article in City AM
Expectations on timing of the elusive first cut have bounced around in recent months and the 3-month forward SONIA curve for 2025/26 is c. 15bps higher than it was a month ago. But looking out 2 or 3 years, the curve hasn’t really moved so variable base rate assumptions in prudent financial plans are unlikely to need knee jerk review.
Longer term rates remain stable and are beginning to look stubbornly static at c.4% on the 10-year swap and c.4.6-4.7% on the 30-year gilt. Our recent development assumptions survey showed clients using an average 5.3% discount rate, having crept up from sub 5%. Expectation that the cost of long-term capital will fall materially appears to be waning.
The relatively insatiable investor demand and falling HA bond spreads has helped offset gilts, and issuances from Clarion, Platform and Paradigm in the 5.3% to 5.4% coupon range is cause for optimism. Bookrunners are suggesting modest premium on sub benchmark issuance for good credit, highlighting the variety of DCM funding options currently available to HAs, and an unusually low cost of carry thanks to high short-term rates is another factor to consider.
1. Tai Tarian refinance: Tai Tarian completed a £95m full re-finance. This involved two new bank funders and a PP investor, all on terms reflective of Tai Tarian’s high credit quality. The refinance will drive a substantial £6m NPV benefit, significantly reducing WACC, optimising financial covenants and corporate controls, and enhancing debt capacity and operational flexibility. Despite current rates, this transaction highlights opportunities to refinance debt and deliver a positive impact.
2. Strategic advisory: We continue to advise on strategic asset disposals and acquisition strategies, highlighting the sophisticated approaches some HAs are exploring to unlock capacity.
3. Risk management: Hedging strategies and interest rate risk management continue to be areas in which we are helping clients.
To learn more about our work in the affordable housing sector, click here.
For more information, please contact Paul Stevens or John Tattersall.
Join us in cheering on our Centrus colleagues Rachael Hickey and Gleb Pilipenko as they take on the Battersea Park Half Marathon on the 11th May 2024. They’re running to support Single Homeless Project, a cause we deeply care about.
Single Homeless Project works tirelessly across all 32 London boroughs, helping individuals tackle the root causes of homelessness. From providing critical support to those facing eviction to assisting with mental health challenges and substance dependency, their work is truly impactful.
Centrus is a proud long-standing supporter of this incredible charity.
Every donation, no matter how small, will make a real difference. Please consider supporting Rachael and Gleb in their efforts – Centrus Communities will match donations.
As May unfolds and the sun starts to shine a little brighter, we’re thrilled to bring you the latest edition of our Centrus Analytics newsletter.
We’re delighted to share that Jigsaw Homes Group Ltd has joined our growing list of titanTreasury users. This partnership with Jigsaw, a leading housing provider with over 35,000 homes across the North of England, marks another milestone in our mission to revolutionize treasury management. By leveraging titanTreasury, Jigsaw aims to streamline their processes, enhance reporting accuracy, and drive efficiencies within their treasury function.
Click here to read more on the partnership.
“titanTreasury is now the treasury and risk management system of choice for the UK housing association sector, along with a growing range of corporate and institutional clients.
Our solution helps reduce time on transactions, by doing the heavy lifting, and enable more time for strategic thinking.”
Gilles Bonlong, Director – Centrus
Join us at the ACT Annual Conference in Liverpool on May 21st and 22nd, 2024, where Centrus, in collaboration with our software partner 3VFinance, will showcase the capabilities of titanTreasury.
Visit us at stand E22 to explore how titanTreasury can empower your organisation.
This year’s conference theme, ‘Thriving in Uncertainty,’ resonates deeply with the challenges many businesses face today. titanTreasury stands ready to assist you in navigating these challenges by offering:
We look forward to connecting with you at the conference. Please get in touch with Gilles Bonlong, Director at Centrus to arrange a meeting.
Financial hedges offer a key solution for managing ongoing energy price volatility arising from geopolitical and environmental risks; certainty of energy-related costs or revenues has become paramount for many of our clients, including both large energy users and generators.
Market volatility stems from conflicts in Eastern Europe and the Middle East, shifting weather patterns, station disruptions, technological advancements, and global politics amid a net-zero transition. Quick and decisive actions to secure energy cost or revenue certainty have proven vital in navigating this environment.
Centrus has been particularly active in advising clients around getting set up to trade financial hedges (derivatives) with financial institutions and energy trading companies. We see four key benefits to being in a position to trade financial hedges:
We continue to support clients through adding value along the full spectrum of accessing energy security, from sourcing and advising on acquisitions of generation assets to arranging power purchase agreements and financial power hedges with financial institutions and energy trading entities.
Want to learn more? Reach out to the Centrus team for a complimentary initial assessment to discover how we can help you save on your energy generation costs.
Please contact Myrto Charamis, Adam MacDonald or Ivan McKinlay for more information.
