RSH quarterly survey shows three-year high in new finance agreements

The total agreed, including refinancing, amounted to £4.4bn, the highest amount since the second quarter of 2020-21. This was also above an average of £2.9bn per quarter over the same period.

In its publication, the RSH said: “Fourteen providers each arranged facilities worth £100m or more in the quarter, and new facilities arranged in the year to date totalled £12.5bn, an increase on £10bn from the same period in 2023.”

Bank lending accounted for 68 per cent of new funding arranged in the quarter and, at £3bn, is the highest amount in more than seven years.

The RSH said bank loans “continued to exceed” capital market issuances for the sixth consecutive quarter.

Capital market funding, including private placements and aggregated bond finance, accounted for 31 per cent (£1.4bn) of the total. One for-profit provider reported new finance “from other sources” of less than £100m.

At the end of March, £129.1bn in total facilities were in place, a rise from £126.7bn in December. This was the largest quarterly increase in over three years since the pandemic.

Cash balances climbed by £100m during the quarter, reaching £4.3bn. However, it was reported that balances are expected to decline to £3.2bn by March 2025.

In the 12 months to March 2024, total drawn debt rose by £6.2bn, compared with £3.7bn in the year to March 2023.

Total cash and undrawn facilities increased from £32.6bn to £34.2bn over the quarter, sufficient to cover forecast expenditure on interest costs (£4.3bn), loan repayments (£3.2bn) and net development (£12.6bn) for the next year.

At the end of March, the majority (95 per cent) of providers were forecasting that debt facilities would be sufficient for more than 12 months. This was a slight drop from 96 per cent in December.

Gross mark-to-market (MTM) exposure on derivatives declined to £300m at the end of the fourth quarter, from £400m in December.