Morhomes the future of financing?

Transforming the HA funding market Meeting the government’s challenge Borrowing more efficiently HAs taking control

MORhomes Created by HAs Owned by HAs Run for Benefit of HAs 60+ HA sponsor/ shareholders

Tackling both ends Addresses all the issues for borrowers Ticks all the boxes for investors Addresses all the issues for borrowers

investor Benefits One stop shop for HAs Benchmark size, repeat issues Geog/ size/ risk spread Credit policy Financial structure (loss buffers) Government support Social bond programme – first ever!

Finance Structure

Nomination & Remuneration Governance Structure Shareholders Board Borrower’s Advisory Group Committees Audit Credit New Issuance Nomination & Remuneration Corporate Code Constitution Covenants Information Memorandum of Association Socially Responsible Investment

borrower benefits Price Simple fast process and documentation Reclaim ‘HA premium’ Economies of scale on issue/ legal costs Simple fast process and documentation No financial covenants Minimal restrictions on use Dividends back to sector Cut out the middleman

Ha Bonds trade at higher yields to equivalent rated corporate bonds Morgan Stanley

Other benefits These benefits produce a range of direct and indirect savings 1. Speed of Access Reduces need for excess liquidity, take advantage of attractive market opportunities 2. Certainty of price Borrowers determine cost of debt rather than taking what they are offered 3. Flexibility on amount Reduces cost of carry, eliminates excess liquidity, improves debt management 4. Flexibility on maturity Optimal place on the yield curve, build cost efficient repayment schedule 5. Certainly of access Reduces need for excess liquidity, increases opportunity to borrow when price is good 6. Security efficiency Can raise and use debt immediately it is needed rather than wait to charge security 7. Security flexibility Allows efficient use of assets in expanding the business 8. User friendly docs Cuts cost of borrowing, speeds borrowing process 9. Credit Process Quick, predictable access to funding, reduces cost of managing debt portfolio 10. Allocated debt limits Reduces uncertainty and requirement for liquidity

Platform ready Outsourced model Operating processes Credit process Efficient High quality Risks managed Operating processes Credit process Documentation Rating Lead managers/ dealer group Ready for issue Financial Adviser - JJCRA Legal Counsel EMTN - Allen & Overy Legal Counsel Devonshires - Audit - KPMG Governance Wedlake - Bell Insourced CEO Board Loan Platform Credit Policy Funding Dealer Group - 8 banks Business Services & Tax RSM - Rating agency - S&P Borrower Counsel – Trowers & Hamlin Credit Validation – Edison

Contact points For more information or details on borrowing with MORhomes contact: Patrick Symington, interim CEO, at patrick.symington@morhomes.co.uk 01256 862005/ 07867 537373 Jennifer Ibbott, Executive Assistant, jenny.Ibbott@morhomes.co.uk 07763 868353