Why we are engaging with Albyn Housing Society Ltd (Albyn)
We are engaging with Albyn about its financial management, development plans and because it is a systemically important landlord.
We refer to a small number of RSLs as systemically important because of their stock size, turnover or level of debt or because of their significance within their area of operation. We need to maintain a comprehensive understanding of how their business models operate, and how they manage the risks they face and the impact these may have. So we seek some additional assurance each year through our engagement plans. Given a combination of Albyn’s size, turnover and level of debt we consider it to be systemically important.
Albyn is one of the larger developers of new affordable housing in Scotland. It has plans to grow through a considerable programme of new homes for social rent and mid-market rent and will receive significant public subsidy to help achieve this.
Albyn has told us it needs to obtain new private finance during 2024/25 to support its development plans.
What Albyn must do
Albyn must:
- send us copies of its Board and audit committee minutes as they become available;
- send us by 30 April 2024:
- an update on the borrowing requirement for 2024/25; and
- its latest projected monthly cash flows for the 12 months to 31 March 2025.
- send us an update on its development programme by 31 October 2024. This will include its latest report to the governing body/appropriate committee about development and details of the scale and tenure mix, timescales for delivery and any material delays or changes to the programme; and
- tell us if there are any material adverse changes to its development plans which might affect its financial position or reputation, in line with our notifiable events guidance.
What we will do
We will:
- review the minutes of the Board and audit committee meetings and liaise as necessary;
- observe Albyn’s Board;
- meet with Albyn’s senior staff to discuss its business plan and any risks to the organisation;
- review the cash flow projections and engage as necessary;
- review the development update and engage as necessary; and
- update our published engagement plan in the light of any material change to our planned engagement with Albyn.
Regulatory returns
Albyn must provide us with the following annual regulatory returns and alert us to notifiable events as appropriate:
- Annual Assurance Statement;
- audited financial statements and external auditor’s management letter;
- loan portfolio return;
- five year financial projections; and
- Annual Return on the Charter.
It should also notify us of any material changes to its Annual Assurance Statement, and any tenant and resident safety matter which has been reported to or is being investigated by the Health and Safety Executive or reports from regulatory or statutory authorities or insurance providers, relating to safety concerns.