Decision details

The Cabinet Member for Finance and Central Services introduced the Treasury Management Annual Report for 2014/15 which set out the key areas of performance during the year. 

The Cabinet Member referred to the Council’s existing borrowing commitments and confirmed that they did not include any ‘toxic’ LOBO (Lender Option Borrower Option) arrangements which a number of neighbouring Local Authorities were tied into and which had been the subject of a recent “Dispatches” programme on Channel 4.  In response to questions from Councillor Gill, the Cabinet Member confirmed that:

·  The Council’s four LOBO loans totalling £40m were at fixed rates that were subject to 10 year reviews and the Council retained the right to settle without penalties in the event that the lender wished to increase the interest rate; and

·  The remaining £61m from the £150m loan facility from the European Investment Bank would be drawn down as required to support the Council’s regeneration programme.

The Assembly resolved to:

(i)  Note the Treasury Management Annual Report for 2014/15;

(ii)  Note that the Council complied with all 2014/15 treasury management indicators;

(iii)  Note that £89m was borrowed from the European Investment Bank to fund the urban regeneration and economic growth programme of Gascoigne Estate (East) Phase 1 and Abbey Road 2;

(iv)  Approve the actual Prudential and Treasury Indicators for 2014/15, as set out in Appendix 2 to the report; and

(v)  Agree to maintain the delegated authority given to the Chief Finance Officer, in consultation with the Cabinet Member for Finance, to proportionally amend the counterparty lending limits agreed within the Treasury Management Strategy Statement to take into account the additional cash holdings resulting from the £89m borrowed from the European Investment Bank.