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LOBO loan borrowing, restructuring or refinancing

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Dear Midlothian Council,

I'm interested in obtaining information regarding your council's LOBO loan borrowing and if/ how this borrowing has been restructured or refinanced by either the lending bank(s) or the council.

Please provide the following information/ loan parameters below in Microsoft XL format:

1) How much of your council's LOBO loan debt has been repaid and refinanced? Please list the LOBO loans that have been refinanced by counterparty, notional amount, original maturity and date of restructuring.

2) Please disclose the break cost paid to the bank counterparty for each loan restructuring and the discount rate used in each valuation.

3) Please disclose any additional PWLB borrowing undertaken to finance LOBO loan restructuring, including the maturities and coupon rates of new PWLB loans.

4) Please disclose the name of any third-party adviser used on the restructuring.

5) Please provide original, modified, and/or restructured loan contracts, including:

a) LOBOs converted into fixed rate loans

b) LOBOs/fixed rate loans converted into PWLB loans

c) LOBOs that have not been refinanced

6) Please provide the name of the broker used for each loan restructuring, and the relevant brokerage fee paid.

7) Please confirm whether your council have applied for any “statutory overrides” or “capitalisation requests” in relation to the accounting for LOBO loans in the council's annual accounts.

Please provide the:

a) Date/year

b) Subject/scope of each override

c) Result of each formal application for a statutory override

I'd appreciate it if you could acknowledge the above requests and inform me of the latest date of which you are required to answer my request by (20 days from the date of receipt).

Thanks for your help,

Jamie Mann

Midlothian Council Enquiries, Midlothian Council

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Thank you for your enquiry regarding 'Freedom of Information request -
LOBO loan borrowing, restructuring or refinancing'.
This will be passed to the appropriate section of the Council for
attention.

PLEASE DO NOT REPLY TO THIS AUTOMATED EMAIL - if you wish to make an
additional enquiry, please create a NEW email.

In any further emails to this account, do NOT use the words `auto
response` in the subject-line, as any such email is automatically
discarded.

Many thanks,

Please can you advise on the due date of this request?

Yours faithfully,

Jamie Mann

Midlothian Council Enquiries, Midlothian Council

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Thank you for your enquiry regarding 'Re: Freedom of Information request -
LOBO loan borrowing, restructuring or refinancing'.
This will be passed to the appropriate section of the Council for
attention.

PLEASE DO NOT REPLY TO THIS AUTOMATED EMAIL - if you wish to make an
additional enquiry, please create a NEW email.

In any further emails to this account, do NOT use the words `auto
response` in the subject-line, as any such email is automatically
discarded.

Linda Cruickshank, Midlothian Council

2 Attachments

Dear Jamie

 

Please see the attached letter from Gary Fairley, Head of Finance and
Integrated Service Support in response to your Freedom of Information
request.

 

Regards

 

Linda Cruickshank

Personal Assistant

' 0131 271 6672

 

Midlothian Council / Business Services / Executive Office Support / 1st
Floor / Midlothian House /Buccleuch Street /Dalkeith /EH22 1DN

 

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Hi Linda,

Thank you for the information so far.

I would now like to ask for an internal review regarding the original LOBO loans contracts, so please could you pass this on to the person responsible for it.

With respect to refusal to provide copies of the original LOBO loan contracts, I refer you to the arguments in favour of disclosure made by the ICO regarding similar requests.

See for example:

ICO Decision Notice, Swansea
https://ico.org.uk/media/action-weve-tak...
ICO Decision Notice, Cornwall
https://ico.org.uk/media/action-weve-tak...
ICO Decision Notice, Kingston Upon Thames
https://ico.org.uk/media/action-weve-tak...
ICO Decision Notice, Solihull
https://ico.org.uk/media/action-weve-tak...

In particular, I would like to draw the council's attention to the following excerpt from the ICO Decision Notice relating to Cornwall Council's use of S43(2):

"Balance of the public interest

"31. The Commissioner has given due weighting to the commercial interests which the exemption is designed to protect. He acknowledges that, particularly at a time where there is significant public spending constraints, authorities should be able to engage in activities which promote the best use of limited monies without this being prejudiced by disclosure.

"32. However, by the same token, the Commissioner is mindful that the agreements in question relate to long term loans (40 years plus) for sums which exceed hundreds of million pounds and which bind the council to make substantial repayments. It is not the Commissioner’s role to determine whether the council has acted appropriately in its pursuance of LOBO loans but the need for the public to be reassured by being able to scrutinize relevant information, particularly when such large sums are involved, is a strong public interest factor.

"33. In relation to the proposed likely damage to the council’s commercial interests, the Commissioner considers that, whilst this is a genuine concern and carries some weight, it is too vaguely formulated in the face of the more concrete public interest in holding decision-making about vast public expenditure to account. He also considers that disclosure of the information when set against the difficulties envisaged by the council, would be more likely to improve competition amongst lenders and assist public authorities in securing more favourable borrowing rates.

"34. In relation to the potential damage to the commercial interests of the lenders, the Commissioner is mindful that, beyond the somewhat generic arguments provided in support of the engagement of the exemption, no specific public interest arguments have been submitted.

"35. In terms of the relationship with the council, the Commissioner considers it very unlikely that lenders would wish to deny themselves access to potentially lucrative public sector lending agreements or, in the specific case of the council, would want to withdraw from a long term agreement.

"36. In relation to the benefits of disclosure to the lenders’ competitors and the resulting damage to the lenders’ ability to negotiate favourable rates, the Commissioner has not been provided with public interest arguments which specifically identify the severity of or extent of such prejudice. The Commissioner notes the complainant’s argument that negotiations and agreements would be predicated on existing market conditions and the specific state of the council’s accounts and requirements. The Commissioner is not persuaded that there is a significant public interest in maintaining the exemption to avert the disclosure of information which is unlikely to have significant or well defined ill-effects.

"37. In light of the above and, having weighed the relevant factors, the Commissioner considers that the public interest balance in this case is weighted towards disclosing the withheld information."

Unless your council can offer a more robust argument than Cornwall, Swansea, Solihull and Kingston Upon Thames Councils that the potential prejudice to the council's commercial interests outweigh the public interest in disclosure, then please can you lift this exemption and provide me with the information I originally requested?

Should the documents still be withheld, I will refer the decision to the Scottish Information Commissioner.

Please also note that the majority of councils across the UK have provided the full un-redacted LOBO loan contracts.

Yours sincerely,

Jamie

Linda Cruickshank, Midlothian Council

Dear Jamie

I acknowledge receipt of your email. I wish to advise that I have forwarded your email to the relevant officer and am awaiting their instruction. I hope to be able get back to you soon.

Regards

Linda Cruickshank
Personal Assistant
 0131 271 6672

Midlothian Council / Business Services / Executive Office Support / 1st Floor / Midlothian House /Buccleuch Street /Dalkeith /EH22 1DN

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Many thanks Linda,

All the best,

Jamie

Linda Cruickshank, Midlothian Council

Dear Jamie

I refer to your request to obtain copies of the original LOBO loans contracts.

Please be aware that under FOISA there is an entitlement to information but not to copies of documentation, such as the loan contracts you have requested. As this part of your request is not valid, copies of the loan contracts will not be provided.

Regards

Linda Cruickshank
Personal Assistant
Phone: 0131 271 6672

Midlothian Council / Business Services / Executive Office Support / 1st Floor / Midlothian House /Buccleuch Street /Dalkeith /EH22 1DN

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Hazel Kerr, Midlothian Council

Hi Jamie

 

I refer to your Freedom of Information request as set out below and can
provide you with the following in response.

 

FOI 11861: I'm interested in obtaining information regarding your
council's LOBO loan borrowing and if/ how this borrowing has been
restructured or refinanced by either the lending bank(s) or the council.
Please provide the following information/ loan parameters below in
Microsoft XL format:

 

1) How much of your council's LOBO loan debt has been repaid and
refinanced? None. Please list the LOBO loans that have been refinanced by
counterparty, notional amount, original maturity and date of
restructuring. No LOBO loans have been refinanced.

 

2) Please disclose the break cost paid to the bank counterparty for each
loan restructuring and the discount rate used in each valuation.  No LOBO
Loans have been restructured.

 

3) Please disclose any additional PWLB borrowing undertaken to finance
LOBO loan restructuring, including the maturities and coupon rates of new
PWLB loans.  No additional PWLB borrowing has been undertaken to finance
LOBO loan restructuring.

 

4) Please disclose the name of any third-party adviser used on the
restructuring. n/a – see 4.

 

5) Please provide original, modified, and/or restructured loan contracts,
including: a) LOBOs converted into fixed rate loans b) LOBOs/fixed rate
loans converted into PWLB loans c) LOBOs that have not been refinanced. 
There are no modified and/or restructured LOBO loans.  The original LOBO
loan contracts cannot be provided on grounds of commercial
confidentiality.

 

6) Please provide the name of the broker used for each loan restructuring,
and the relevant brokerage fee paid. No LOBO loans have been restructured.

 

7) Please confirm whether your council have applied for any “statutory
overrides” or “capitalisation requests” in relation to the accounting for
LOBO loans in the council's annual accounts. Please provide the: a)
Date/year b) Subject/scope of each override c) Result of each formal
application for a statutory override I'd appreciate it if you could
acknowledge the above requests and inform me of the latest date of which
you are required to answer my request by (20 days from the date of
receipt).  There have been no “statutory overrides” or “capitalisation
requests” when accounting for LOBO loans in our annual accounts.

 

 

Please be advised that an applicant who is dissatisfied with the way in
which Midlothian Council has dealt with his/her request for information
under section 1(1) of the FOISA, by virtue of section 20 of the FOISA, may
require Midlothian Council to review its actions and/or decisions in
relation to that request.  Details of Midlothian Council's complaints
procedure under the FOISA are set out in the section outlined as follows:

 

Midlothian Council’s Complaints Procedure under the FOISA:

An applicant who is dissatisfied with the way in which Midlothian Council
has dealt with his/her request for information under section 1(1) of the
FOISA, may, by virtue of Section 20 of the FOISA, require Midlothian
Council to review its actions and/or decisions in relation to that
request.

 

If you wish Midlothian Council to review its actions and/or decisions with
respect to your request for information, you should write to the Director,
Corporate Resources or other official whose name is printed at the top of
this letter.  That official will arrange for your application for review
to be considered.  Thereafter he will write to you informing you of the
decision by not later than twenty working days after receipt of your
request requiring that a review be made.  By virtue of Section 21 of the
FOISA, you will be provided with a statement of reasons for arriving at
the decision made.

 

Your request for review should reach Midlothian Council within 40 working
days.

 

Requests for review must be in writing (or in another form which has some
permanency and is capable of being used for subsequent reference e.g.
audio/video tape recording). You must:-

 

·         state your name and address for correspondence;

·         give details of the information which you originally requested
from Midlothian Council; and

·         state the reasons why you are dissatisfied with the way in which
your application for information has been dealt with.

 

Your Right to Complain to the Scottish Information Commissioner:

 

Under Section 47 of the FOISA, a person who is dissatisfied with the
outcome of their request for review by the Council may apply to the
Scottish Information Commissioner to determine whether their request (or
any part of it) has been properly dealt with.

 

An application to the Scottish Information Commissioner must be made in
writing (or in another form having some permanency eg an audio/video tape
recording) within six months of receipt of a Section 21 Notice by the
applicant.  The applicant must specify:-

 

a)            his/her name and address for correspondence;

b)            the request for information to which the requirement for
review by Midlothian Council related;

c)            the matter which gave rise to the applicant’s
dissatisfaction with the way in which Midlothian Council dealt with their
original request; and

d)                  the matter which gives rise to the applicant’s
dissatisfaction relating to the review by Midlothian Council.

 

The Scottish Information Commissioner can be contacted at:-

Scottish Information Commissioner, Kinburn Castle, Doubledykes Road, St
Andrews, Fife, KY16 9DS

(Telephone – 01334 464610; Fax -  01334 464611; Email –
[1][email address])

 

Thanks

 

Hazel Kerr

 

Lead Performance and Improvement Officer

Business Applications

Resources

Midlothian Council

[2][email address]

 

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References

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1. mailto:[email address]
2. mailto:[email address]

Gary Thomson, Midlothian Council

4 Attachments

Good afternoon Mr Mann

 

Please find attached copies of the requested documentation is respect of
Midlothian Council’s 4 LOBO Loan Contracts.

 

Kind Regards

 

Gary

 

Gary Thomson | Senior Accountant, Corporate Finance, Projects & Treasury |
Financial Services | Resources

Midlothian Council | Midlothian House | Buccleuch Street | Dalkeith |
Midlothian | EH22 1DJ

Tel: 0131 271 3230 | Fax: 0131 271 3251 |
[1][email address] | [2]www.midlothian.gov.uk

 

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References

Visible links
1. mailto:[email address]
2. https://clicktime.symantec.com/3Rs4c5Yjk...

Many thanks for these Gary,

Yours sincerely,

Jamie Mann

Gary Thomson, Midlothian Council

1 Attachment

Good afternoon Mr Mann

 

Please see further attachment which includes the Dexia document dated 8^th
October 2004.  Apologies for the oversight in our previous Email.

 

Kind Regards

 

Gary

 

Gary Thomson | Senior Accountant, Corporate Finance, Projects & Treasury |
Financial Services | Resources

Midlothian Council | Midlothian House | Buccleuch Street | Dalkeith |
Midlothian | EH22 1DJ

Tel: 0131 271 3230 | Fax: 0131 271 3251 |
[1][email address] | [2]www.midlothian.gov.uk

 

 

 

From: Gary Thomson
Sent: 04 October 2019 14:13
To: '[FOI #552382 email]'
<[FOI #552382 email]>
Cc: Alan Turpie <[email address]>; Brenda Glass
<[email address]>
Subject: FoI Public Enquiry 160805: LOBO Loan Contracts

 

Good afternoon Mr Mann

 

Please find attached copies of the requested documentation is respect of
Midlothian Council’s 4 LOBO Loan Contracts.

 

Kind Regards

 

Gary

 

Gary Thomson | Senior Accountant, Corporate Finance, Projects & Treasury |
Financial Services | Resources

Midlothian Council | Midlothian House | Buccleuch Street | Dalkeith |
Midlothian | EH22 1DJ

Tel: 0131 271 3230 | Fax: 0131 271 3251 |
[3][email address] | [4]www.midlothian.gov.uk

 

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References

Visible links
1. mailto:[email address]
2. https://clicktime.symantec.com/3Rs4c5Yjk...
3. mailto:[email address]
4. https://clicktime.symantec.com/3Rs4c5Yjk...

No problem Gary,

Many thanks for this,

Yours sincerely,

Jamie Mann

We don't know whether the most recent response to this request contains information or not – if you are Jamie Mann please sign in and let everyone know.