This landlord is a subsidiary of Link Group Ltd. You can read the engagement plan for Link Group Ltd and all of its subsidiaries below.
Why we are engaging with Link Group Ltd (Link Group)
We are engaging with Link Group about its financial management, development plans and because it is a systemically important landlord.
Link Group has four registered subsidiaries, Horizon Housing Association Ltd (Horizon), Larkfield Housing Association Ltd (Larkfield), Link Housing Association Ltd (Link HA) and West Highland Housing Association Ltd (West Highland).
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 Link Group’s size, turnover and level of debt we consider it to be systemically important.
Link Group is one of the largest developers of new affordable housing in Scotland. It has plans to grow through a considerable programme of new homes for social rent, mid-market rent and low cost home ownership and will receive significant public subsidy to help achieve this. We will engage with Link Group to get assurance about how it is managing the risks to the organisation including its levels of debt and development plans.
What Link Group must do
Link Group must:
- send us copies of its Board and audit committee minutes as they become available;
- send us by 30 April 2024:
- its approved business plan and updated risk register;
- 30 year financial projections consisting of statement of comprehensive income, statement of financial position and statement of cash flow complete with assumptions and explanatory narrative;
- a comparison of projected financial loan covenants against current covenant requirements;
- financial sensitivity analysis which considers the key risks, the mitigation strategies for these risks and a comparison of the resulting covenant calculations with the actual current covenant requirements;
- the report to the Board in respect of the approved 30 year projections, sensitivity analysis and covenant compliance; and
- evidence of how it demonstrates affordability for its tenants.
- 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 Link Group’s Board;
- review the business plan and financial information;
- meet with Link Group’s senior staff to discuss the business plan, the financial information and any risks to the organisation;
- 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 Link Group.
Regulatory returns
Link Group 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.