Why we are engaging with Clyde Valley
We are engaging with Clyde Valley because it is a systemically important landlord and about its service performance.
COVID-19 has significantly impacted the services provided by social landlords. We will continue to monitor, assess and report upon how each landlord is responding and we will keep our regulatory engagement under review so that we can continue to respond to the challenges of COVID-19.
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 Clyde Valley’s size and level of debt we consider it to be systemically important.
Clyde Valley has identified weaknesses in its management of gas safety. It is committed to addressing the weaknesses as quickly as possible. It has developed an action plan and is making good progress in carrying out its programme of improvements. As part of its action plan Clyde Valley is reviewing the accuracy of its data on gas safety. We have been engaging with Clyde Valley about the steps it is taking to address these issues and to ensure it is complying with the Regulatory Standards of Governance and Financial Management and its tenant safety duties.
Clyde Valley is one of the larger developers of new affordable housing in Scotland and receives significant public subsidy to help achieve this. Clyde Valley plans to develop new homes for social rent and mid-market rent.
What Clyde Valley must do
In order to allow us to complete our review of its regulatory status Clyde Valley must:
- provide us with assurance that it is continuing to address the tenant safety matters; and
- provide us with the outcome of its review of the accuracy of its gas safety data.
Clyde Valley must also:
- provide copies of its Board and audit committee minutes as they become available; and
- ensure that the impact of the pandemic on its development plans is reflected in its business plan and tell us if there are any material changes to its development plans which might affect its financial position or reputation, in line with our notifiable events guidance.
What we will do
- engage with Clyde Valley to monitor progress with its plans in response to the tenant safety matters;
- consider the outcome of Clyde Valley’s review of the accuracy of its data on gas safety;
- review the minutes of the Board and audit committee meetings and liaise as necessary; and
- update Clyde Valley’s regulatory status when we have completed our inquiries into the tenant safety matters.
Clyde Valley 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.