2 September 2021

New rating provided by S&P

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On 2 September 2021, S&P Global Ratings lowered its long-term issuer credit rating on Octavia to 'A-' from 'A' and removed it from under credit observation (UCO). The outlook remains stable.

This revised rating follows publication of S&P’s revised "Methodology For Rating Public and Nonprofit Social Housing Providers" on 1 June 2021.

In applying their new criteria, S&P have adjusted their previous rating to “take into consideration the newly introduced regulatory framework.”

S&P’s stable outlook “reflects their expectation that the strong demand for Octavia's services will support a gradual improvement in the group's profitability.”

S&P went on to comment that they “consider Octavia's liquidity position to be very strong, largely thanks to its high amount of undrawn committed facilities,” and that they “expect Octavia to benefit from its focus on high-value areas of central and west London, where there is high demand for affordable housing. The group's tenant base tends to be stable, with low vacancy rates of 1.1% of rent receivables and service charges, more or less in line with its peers and the sector average.”

Sandra Skeete, Chief Executive, Octavia, said:

“With over 5,300 affordable homes for rent and shared ownership in central and west London, Octavia has stayed true to its original social purpose for over 150 years. We continue to offer genuinely affordable rents to people on the lowest incomes in some of the most expensive parts of the capital and we remain committed to supporting our communities in these challenging times.”

“As S&P have highlighted, they expect Octavia's profitability to marginally improve over the coming three years despite our ambitious development program - which aims to deliver around 500 much needed new affordable homes in London.”

“We continue to have excellent overall customer satisfaction scores, and we remain confident in our future prospects, supported by the strength of our balance sheet, our financial flexibility, our ability to service debt and our strong liquidity position.”