TIDM58HD
RNS Number : 5031G
Great Hall Mortgages No1 plc
26 July 2021
THIS NOTICE IS IMPORTANT AND REQUIRES THE IMMEDIATE ATTENTION OF
INSTRUMENTHOLDERS. PLEASE LET THIS NOTICE SERVE AS OFFICIAL
AUTHORISATION (LETTER OF AUTHORITY) TO RELEASE SECURITY HOLDINGS
IDENTITY INFORMATION UNDER EU DIRECTIVE 2007/36/EC AND THE RELATED
COMMISSION IMPLEMENTING REGULATION (EU) 2018/1212 OF 03 SEPTEMBER
2018. IF INSTRUMENTHOLDERS ARE IN ANY DOUBT AS TO THE ACTION THEY
SHOULD TAKE, THEY SHOULD SEEK THEIR OWN FINANCIAL AND LEGAL ADVICE,
INCLUDING AS TO ANY TAX CONSEQUENCES, IMMEDIATELY FROM THEIR
STOCKBROKER, SOLICITOR, ACCOUNTANT OR OTHER INDEPENT FINANCIAL OR
LEGAL ADVISER.
NOTICE TO THE HOLDERS OF THE
GBP 278,800,000 Class Aa Notes due 2039
(Common Code: 30835450; ISIN: XS0308354505)
(the "Class Aa Notes")
EUR 30,000,000 Class Ab Notes due 2039
(Common Code: 30835484; ISIN: XS0308354843)
(the "Class Ab Notes")
USD 600,000,000 Class Ac Notes due 2039
(Common Code Reg S: 30846214; Common Code 144A: 39052PAA7 ;
(ISIN Reg S: XS0308462141; ISIN 144A: US39052PAA75) (the "Class
Ac Notes")
GBP 75,200,000 Class Ba Notes due 2039
(Common Code: 30835697; ISIN: XS0308356970)
(the "Class Ba Notes")
GBP 9,000,000 Class Ca Notes due 2039
(Common Code: 30835735; ISIN: XS0308357358)
(the "Class Ca Notes")
EUR 42,100,000 Class Cb Notes due 2039
(Common Code: 30835573; ISIN: XS0308355733)
(the "Class Cb Notes")
GBP 2,000,000 Class Da Notes due 2039
(Common Code: 30835778; ISIN: XS0308357788)
(the "Class Da Notes")
EUR 28,000,000 Class Db Notes due 2039
(Common Code: 30835611; ISIN: XS0308356111)
(the "Class Db Notes")
GBP 7,500,000 Class Ea Notes due 2039
(Common Code: 30825786; ISIN: XS0308257861)
(the "Class Ea Notes")
EUR 10,000,000 Class Eb Notes due 2039
(Common Code: 30835646; ISIN: XS0308356467)
(the "Class Eb Notes")
issued by
Great Hall Mortgages No. 1 PLC Series 2007-2
(the "Issuer" or the "Transaction" as the context requires)
on 28 June 2007
The Class Aa Notes, Class Ab Notes, Class Ac Notes, Class Ba
Notes, Class Bb Notes, the Class Ca Notes, the Class Cb Notes, the
Class Da Notes, the Class Db Notes and the Class Ea Notes are
together, the "Instruments".
Capitalised terms used but not otherwise defined in this notice
shall have the meanings set out in the glossary in the prospectus
issued by the Issuer on 28 June 2007 in respect to the
Transaction.
[Since July 2017, there has been a concerted and intensive
global regulator-driven effort to encourage, and ultimately effect,
the transition away from the use of interbank offered rates,
including the GBP London Interbank Offered Rate ("LIBOR"), in
financial instruments to risk-free rates or other appropriate
benchmarks.
In January 2020, the Bank of England (the "BoE"), the UK
Financial Conduct Authority (the "FCA") and the Working Group on
Sterling Risk-Free Reference Rates published a joint statement
outlining priorities and milestones for 2020 on LIBOR
transition.
LIBOR-linked mortgages, such as the Loans, are specifically
highlighted as a class for which there is a case for action in the
UK Risk Free Rate's Working Group's ("RFR Working Group") Paper on
the identification of Tough Legacy issues published in May
2020.
On 5 March 2021, the FCA formally announced that the future
cessation and loss of representativeness of LIBOR will take place
on 31 December 2021. The FCA will no longer compel panel banks to
submit to LIBOR beyond 31 December 2021 and the FCA will no longer
use its powers to require the benchmark administrator of LIBOR to
continue to use its powers to publish LIBOR on the basis of panel
bank submissions. In addition, the Bank of England and the FCA have
mandated the RFR Working Group to promote a broad-based transition
to the Sterling Overnight Index Average ("SONIA") across sterling
bond, loan and derivative markets, so that SONIA is established as
the primary sterling interest rate benchmark by the end of 2021.
Therefore, the continuation of LIBOR on the current basis will
cease after 2021, and regulators have urged market participants to
take active steps to implement the transition to SONIA and other
risk-free rates ("RFRs") ahead of this deadline.
By way of overview, the Transaction includes the following
LIBOR-linked elements:
1. Notes with a floating rate of interest linked to LIBOR;
2. Series Investment Accounts with floating rates of interest linked to LIBOR;
3. a Series Liquidity Facility with a floating rates of interest linked to LIBOR;
4. a Series Currency Hedge Agreement with reference to LIBOR,
which in each case are subject to the terms of the Transaction
Documents and the Series Note Conditions; and
5. underlying Mortgage Loans bearing interest linked to LIBOR,
which are subject to the terms of the Mortgage Conditions.
The below provisions are subject to the Transaction Documents
(as the same may have been amended or restated from time to
time).
Overview
The Issuer is considering certain amendments to the Transaction
Documents to replace LIBOR with an alternative reference rate
before the discontinuation of LIBOR and the activation of fall-back
positions (if any) in such documents. Noteholders are requested to
disclose their identity and holdings to the Issuer in order to
participate in discussions relating to the replacement methodology
and are encouraged to review the Series Note Conditions and the
Transaction Documents in full (in particular any fallback
provisions applicable in case of unavailability of LIBOR) and take
their own advice as to the potential implications of the
discontinuation of LIBOR.
The Issuer is considering soliciting a proposal for amendments
to the Transaction Documents to Noteholders. Any such solicitation
will take place as soon as possible to enable the Issuer sufficient
time to implement any approved proposal before the Interest Payment
date falling on 18 December 2021 at the latest. Should Noteholders
not disclose themselves and participate in discussions, the
preferences of Noteholders may not be taken into consideration in
preparing the final proposal for Noteholders to vote on by way of
an Extraordinary Resolution at meetings of the Noteholders.
1. Notes with a floating rate of interest linked to LIBOR
If, following the discontinuance of LIBOR, the Benchmark Rate
cannot be determined by the Interest Calculation Agent, the
Benchmark Rate shall be the Benchmark Rate most recently determined
in relation to the Interest Liability, as set out in section 5.5
(Determination of Benchmark Rate using a previous rate) of the
Standard Benchmark Rate Provisions applicable to the Notes. If the
rate of interest is determined by reference to a calculation made
on a previous historic date on an ongoing basis, this would have
the effect of converting the existing floating rate of interest to
a fixed rate of interest.
2. Series Investment Accounts bearing rates of interest linked to LIBOR
If, following the discontinuation of LIBOR, it is not possible
to determine Series Investment Account Interest Rates to be paid by
the Series Investment Account Provider on the Series Investment
Accounts, pursuant to clause 3.1(c) of the Note Issue Instrument
constituting the Series Investment Account Servicers Agreement and
sections 4.6 and 4.7 of the Series Specific Provisions set out in
the Note Issue Supplement, no alternative interest rate is provided
for in the Transaction Documents. This will potentially result in
no effective interest rate being applied to the Series Investment
Accounts.
3. Series Liquidity Facility bearing rate of interest linked to LIBOR
If, following the discontinuation of LIBOR, it is not possible
to determine the Interest Rate for the Series Liquidity Facility
Drawings, no alternative interest rate is provided for in the
Transaction Documents. This will potentially result in no effective
interest rate being applied under the Series Liquidity Facility
Agreement.
4. Series Currency Hedge Agreement with a rate linked to LIBOR
If, following the discontinuation of LIBOR, the rates for the
Series Currency Hedge Agreement cannot be determined, no
alternative rate is provided for in the Transaction Documents. This
will potentially result in no effective interest rate being applied
under the Series Currency Hedge Agreement.
5. Underlying mortgage loans bearing interest linked to LIBOR
The Series Portfolio Servicer has been appointed to perform
mortgage administration services as set out in the Series Portfolio
Services Agreement. In the Series Portfolio Services Agreement, the
Series Portfolio Legal Title Holder has been granted the authority
as lender to determine and set the rate of interest applicable to
the Mortgage Loans in accordance with the Mortgage Conditions in
the Series Portfolio.
As of the date of the latest investor report dated 18 March
2021, in respect of the Interest Payment Date on 18 March 2021,
there were 1067 LIBOR-linked mortgage loans outstanding
(representing 43.18% of the total outstanding pool), as more
particularly set out in such investor report.
Pursuant to the terms of the Standard Series Portfolio Services
Provisions, the Series Portfolio Servicer shall take all action and
do all other things which it would be reasonable to expect a
Prudent Residential Mortgage Lender to do in administering its
mortgages or as reasonably requested by the Security Trustee.
The FCA acknowledges that there are "tough legacy" contracts
across various financial products which reference LIBOR and cannot
practicably be transitioned away from that benchmark rate without
actions or agreements by or between the contract counterparties
themselves which are practically difficult to undertake in the
period until discontinuance.
The Financial Services Act 2021 (the "Act") provides an
overarching legal framework which gives the FCA new and enhanced
powers to manage the wind-down of a critical benchmark and seeks to
reduce the risk of litigation arising from disputes about the
continuity of "tough legacy" contracts. The Act aims to do this by
providing the FCA with the necessary powers to designate a change
to the methodology by which a benchmark such as LIBOR is set so
that references in "tough legacy" contracts to LIBOR will
effectively be treated as a reference to the new methodology (i.e.
a synthetic LIBOR rate), rather than a rate which no longer
exists.
On 20 May 2021, the FCA launched a consultation paper in
relation to how it proposes using its powers in relation to the use
of critical benchmarks that are being wound down. The FCA stated
that the paper would be of interest to users of critical benchmarks
such as LIBOR, including mortgage lenders and intermediaries and
consumers who have mortgages that use critical benchmarks. The FCA
asked for comments on the paper by 17 June 2021 and following the
consultation, in Q3 of 2021, it will publish a statement of policy
and feedback statement.
The Issuer and the Servicer are in discussions as to what
action, if any, can or will be taken in respect of the LIBOR-linked
Mortgage Loans in light of the obligations of the relevant parties
under the Mortgage Conditions, the Transaction Documents, the
publications from the BoE, FCA and RFR Working Group and also
applicable law and regulation. There can be no assurance that the
interest rate on the LIBOR-linked Mortgage Loans will be able to be
set by the Series Portfolio Legal Title Holder following the
discontinuation of LIBOR.
Restrictions on Amendments
Any proposed amendment to the rate of interest on the Notes, the
Series Investment Accounts and/or the Series Liquidity Facility
from LIBOR to SONIA or an alternative RFR (including the
determination of any credit spread adjustment and any consequential
amendments to the Transaction Documents to give effect thereto)
will require the approval of Noteholders by way of Extraordinary
Resolutions passed by Noteholders in accordance with the Series
Note Conditions and the Series Trust Deed. Such amendments will
also require the approval of certain parties to those Transaction
Documents.
The Interest Calculation Agent has no discretion in relation to
the determination of the interest rate for the Notes is obliged to
determine the same in accordance with the Series Note Conditions
and the Transaction Documents. The Series Note Trustee is not in a
position to exercise any discretionary power in relation to any
proposed amendment to the Transaction Documents in connection with
LIBOR transition as any alternation of the interest rate applicable
in respect to the Notes is a Series Basic Terms Modification. An
Extraordinary Resolution of any class of Noteholders in relation to
a Series Basic Terms Modification shall not be effective unless it
is sanctioned by an Extraordinary Resolution of Noteholders of each
other class of Notes.
Nothing in this notice is intended to amount to an invitation or
inducement to engage in investment activity, the exchange of
commercially sensitive information and/or any other form of
coordination, other than what is strictly necessary for the review
of the Series Note Conditions and the Transaction Documents in
light of proposed amendments to such documents, including in
relation to the transition from LIBOR to an alternative RFR. Please
note that any information disclosed amongst Noteholders might
constitute inside information under Regulation (EU) No 596/2014
(market abuse regulation) as regards the Issuer and the Notes. By
contacting the Issuer and engaging with other Noteholders (if
applicable), all Noteholders confirm that they are aware that any
such information disclosed between Noteholders might constitute
inside information and that they are aware of their legal
responsibilities in that respect.
In accordance with normal practice, the Series Note Trustee
assumes no responsibility for this notice. The Series Note Trustee
has not verified, and expresses no opinion as to the contents of
this notice, and makes no representation that all relevant
information has been disclosed, or has been disclosed accurately,
to Noteholders. Accordingly, the Series Note Trustee urges
Noteholders who are in any doubt as to the impact of this notice to
seek their own independent legal and/or financial advice.
6. Procedure for disclosing identity and holdings
The Issuer wishes to initiate engagement strategy with
Noteholders and has appointed i2 Capital Markets Ltd as its
information agent (the "Information Agent") to facilitate
communication between the Noteholders and the Issuer, initially by
requesting Noteholders (or their respective custodians and
intermediaries) to disclose their identities and holdings of the
Notes to the Information Agent as soon as possible.
Noteholders are encouraged to disclose themselves as a matter of
urgency by contacting the Information Agent. Noteholders (or their
respective custodians and intermediaries) should respond to this
disclosure request by no later than 4:00pm (London Time) on Tuesday
3 August 2021 via one of two options below:
6.1 Providing their information directly to the Information
Agent (including through its custodian bank, broker or other
intermediary) by registering interest at:
7.
https://i2capmark.com/event-details/21/Holder/great-hall-mortgages-no.1-plc-series-2007-2
Registration will allow holders (or their representative) to
receive up-to-date information, notices and materials promptly
about any forthcoming information regarding the Notes.
In order to access this restricted information, holders must
first register as a user (follow the prompts to sign up) then
access the event relating to the Notes by completing a
participation form, which will include submitting your current
proof of holding.
Please obtain either a current custodian statement or screenshot
from your custodian who has an account with either Euroclear or
Clearstream; and/or
7.1 Provide the required information, via their custodian bank,
to the relevant clearing system, Euroclear or Clearstream, through
the relevant disclosure event established for this identification
request.
The Issuer and Information Agent do not require the blocking of
your securities in order to reply to the request and custodian
banks should ensure they advise their clients of this
identification request.
Any information gathered by the Information Agent will be kept
strictly confidential and for use by the Issuer (and its advisers)
only.
If you have any questions or require any clarification about
this notice, please contact the Information Agent:
i2 Capital Markets Ltd
Kemp House
160 City Road
London
EC1V 2NX
Email: info@i2capmark.com
Phone: +44 203 633 1212
Attention: The Directors
This notice is given by the Issuer.
Dated: 20 July 2021
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END
MSCDKABKPBKDNOB
(END) Dow Jones Newswires
July 26, 2021 11:06 ET (15:06 GMT)
Grafico Azioni Gt.hall No1 A1 (LSE:58HD)
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