Details of LOBO borrowing and brokerage arrangements

Ludovica Rogers made this Freedom of Information request to Trafford Metropolitan Borough Council

This request has been closed to new correspondence from the public body. Contact us if you think it ought be re-opened.

The request was partially successful.

Dear Trafford Metropolitan Borough Council,

For each of the Lender Option, Borrower option (LOBO) loans Sheffield Council currently has on its books, and for any historical LOBO loans, please provide:

1) Loan principal?
2) Maturity date?
3) Trade date when the loan was signed?
4) Initial interest rate?
5) Current stepped-up interest rate and step-up date where applicable?
6) Any formula or structure determining the interest rate where applicable?
7) The first LOBO option call date?
8) The LOBO option call frequency?
9) Day count convention used for calculation of interest payments?
10) The original broker of the loan and fee paid?
11) Broker and fee paid for any subsequent restructuring?
12) The relevant bank or financial institution(s) which issued each LOBO loan?
13) The name of the Treasury Management Advisor who advised on each LOBO loan
14) Where available, the original unredacted LOBO loan contracts.

Please note that recent LOBO loan ICO cases including Cornwall and Swansea have ruled in favour of full disclosure of the loan contracts.

Yours faithfully,

Ludovica Rogers

Data Protection, Trafford Metropolitan Borough Council

Thank you for your email. 

Your enquiry has been given the reference number 4514.  Please quote this in all future correspondence with regard to this enquiry.

We aim to respond fully to all emails from the public as soon as possible, where they are seeking a response. 

If you are requesting information under the Freedom of Information Act or environmental Information Regulations, there is a 20 working day statutory timescale within which to provide the information requested, subject to any exemptions which may apply.  The 20 working day timescale will start on the first working day following receipt of your email.

If you have access to the Internet you may wish to see if your enquiry can be dealt with online at www.trafford.gov.uk.  The council's website enables many forms to be completed and payments to be made online, as well as providing comprehensive information.

Thank you
Trafford Council

Trafford Council is a well-performing, low-cost council delivering excellent services to make Trafford a great place to live, learn, work and relax. You can find out more about us by visiting www.trafford.gov.uk

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Data Protection, Trafford Metropolitan Borough Council

Dear Ludovica,

Please can you confirm whether this FOI request is for Trafford Council as the body of the email states Sheffield Council?

We will not process this request until you clarify this.

Regards,

Paul

Paul Fox , Information Governance Manager
Legal Services | Trafford Council | Trafford Town Hall | Talbot Road | Stretford | M32 0TH
Email: [email address]
Tel: 0161 912 1327
Fax: 0161 912 4294
[mobile number]

Trafford Council is a well-performing, low-cost council delivering excellent services to make Trafford a great place to live, learn, work and relax. You can find out more about us by visiting www.trafford.gov.uk

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Dear Paul fox,

Yes, apologies for the mistake.

I confirm that the FOI request is for Trafford Council.

Yours sincerely,

Ludovica Rogers

Data Protection, Trafford Metropolitan Borough Council

1 Attachment

  • Attachment

    FOI table of LOBO loans Feb 17.xlsb

    12K Download

Dear Mr Ludovica
Thank you for your email of 22 February 2017 where you requested information about LOBO loans
The information you requested is attached.

Question 14: I can confirm that we do hold the information you have requested, however on this occasion, the information you have requested is exempt from disclosure under Section 43 of the Freedom of Information Act, due to the commercially sensitive nature of the information. Specific terms of loans are commercially sensitive and neither the lender nor borrower would expect specific details of the terms of a loan to be disclosed to the public. We do not believe that the public interest in disclosure is proportionate to the damage that would be caused as this would affect the Councils ability to borrow at competitive rates.

If you are dissatisfied with the handling of your request, you have the right to ask for an internal review. Internal review requests should be submitted within two months of the date of receipt of the response to your original letter and should be addressed to: Information Governance Manager, Trafford Council, Town Hall, Talbot Road StretfordM33 0TH or via email to [Trafford Council request email]

Please remember to quote the reference number above in any future communications.

If you are not content with the outcome of the internal review, you have the right to apply directly to the Information Commissioner for a decision. The Information Commissioner can be contacted at: Information Commissioner’s Office, Wycliffe House, Water Lane, Wilmslow, Cheshire, SK9 5AF

The supply of information in response to a freedom of information request does not confer an automatic right to re-use the information.  Under UK copyright law you can use any information supplied for the purposes of private study and non-commercial research without requiring permission.  Similarly, information supplied can also be re-used for the purposes of news reporting. An exception to this is photographs.
For other forms of re-use, for example publishing the information, you would need the permission of the organisation or person who owns the copyright.  In the case of information produced by government departments and agencies you can re-use the information under the Open Government Licence.  For information about this please see http://www.nationalarchives.gov.uk/doc/o...
If, however, the copyright is identified as belonging to somebody else, you will need to apply for permission.  For information about how to obtain permission from a third party, please go to Intellectual Property Office’s website at www.ipo.gov.uk

Yours sincerely,

Information Governance
Legal Services | Trafford Council | Trafford Town Hall | Talbot Road | Stretford | M32 0TH
Email: [email address]

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Ludovica Rogers

Dear Trafford Council,

Thank you for your response.
Could you kindly provide the spreadsheet in a normal excel format (.xls) as I am unable to open the format you have sent.

Kind regards,

Ludovica Rogers

Data Protection, Trafford Metropolitan Borough Council

1 Attachment

Dear Mr Rogers
I have attached an updated version of the spreadsheet which I have saved as .xls. As this file extension has not been used since Excel 2007 was introduced we do not use this as standard. If you have any problems opening the attachment please do let me know

Kind regards

Kathryn Wright, Information Governance Officer
Legal Services | Trafford Council | Trafford Town Hall | Talbot Road | Stretford | M32 0TH
Email: [email address]
Tel: 0161 912 2526
[mobile number]
Fax: 0161 912 4294

Trafford Council is a well-performing, low-cost council delivering excellent services to make Trafford a great place to live, learn, work and relax. You can find out more about us by visiting www.trafford.gov.uk

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Ludovica Rogers

Dear Trafford Metropolitan Borough Council,

Thank you for providing the spreadsheet in xls format. I am now able to view it.

I would now like to ask for an internal review regarding question 14, so please could you pass this on to the person responsible for it.

I am writing to request an internal review of Trafford Metropolitan Borough Council's handling of my FOI request 'Details of LOBO borrowing and brokerage arrangements'.

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/d...

With respect to the exemption under S43 I refer you to the arguments in favour of disclosure made by the ICO Decision notice in response to Jamie Griffiths referral 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 Trafford 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 Trafford 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 I suggest that this exemption is lifted. Should the documents be withheld, I will not hesitate to refer the decision to the Information Commissioner's Officer.

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

Kind regards,

Ludovica Rogers

Data Protection, Trafford Metropolitan Borough Council

Dear Ludovica

Thank you for your email in which you expressed dissatisfaction with our response to your FOI, reference 4514.

Your request has now been passed for internal review. We aim to complete all internal reviews within 20 working days. We will notify you of the outcome of the review and, where appropriate, provide the requested information.

If you require any further information in the meantime, please do not hesitate to contact us

Kind regards

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Dear Trafford Metropolitan Borough Council,

20 working days have passed since I submitted the request for internal review.
Could you please let me know when I should expect a response.

Kind regards,

Ludovica Rogers

Data Protection, Trafford Metropolitan Borough Council

Dear Mr Rogers,
Apologies for the delay in completing our review of your request for information about LOBO loans(FOI 4514). The case has been referred to our Director of Legal and Democratic Services and we are awaiting her decision. We will contact you shortly with the outcome and any requested information where appropriate.

Kind regards

Kathryn Wright, Information Governance Officer
Legal Services | Trafford Council | Trafford Town Hall | Talbot Road | Stretford | M32 0TH
Email: [email address]
Tel: 0161 912 2526
[mobile number]
Fax: 0161 912 4294

Trafford Council is a well-performing, low-cost council delivering excellent services to make Trafford a great place to live, learn, work and relax. You can find out more about us by visiting www.trafford.gov.uk

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Data Protection, Trafford Metropolitan Borough Council

Dear Mr Rogers,

Further to your request for an internal review into FOI 4514, I confirm that the Council has considered your arguments and will disclose copies of un-redacted LOBO loan contracts. These will be provided in due course.

Kind regards,

Paul Fox , Information Governance Manager
Legal Services | Trafford Council | Trafford Town Hall | Talbot Road | Stretford | M32 0TH
Email: [email address]
Tel: 0161 912 1327
Fax: 0161 912 4294
[mobile number]

Trafford Council is a well-performing, low-cost council delivering excellent services to make Trafford a great place to live, learn, work and relax. You can find out more about us by visiting www.trafford.gov.uk

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Data Protection, Trafford Metropolitan Borough Council

6 Attachments

Dear Mr Rodgers,

Further to your request for an internal review into the response you received regarding FOI 4514.

Please find attached copies of the six LOBO loan agreements and, where applicable, documentation confirming when they were sold to another bank.

Kind regards,

Paul Fox , Information Governance Manager
Legal Services | Trafford Council | Trafford Town Hall | Talbot Road | Stretford | M32 0TH
Email: [email address]
Tel: 0161 912 1327
Fax: 0161 912 4294
[mobile number]

Trafford Council is a well-performing, low-cost council delivering excellent services to make Trafford a great place to live, learn, work and relax. You can find out more about us by visiting www.trafford.gov.uk

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