TUHF Securitisation

February 5, 2019

JOHANNESBURG, BRAAMFONTEIN, December 12, 2018 – TUHF Urban Finance (RF) Limited has announced that the new tranche of its mortgage-backed securities have totalled R450 million.

The net proceeds from the Notes offered are detailed as follows:

The Notes were issued in three classes consisting of R385m initial principal amount of Class A Notes. The Class A Notes received bids of R1bn, which resulted in a price clearing at Jibar +222 bps.

Class B notes were offered at R45m, which were bid at R135m, clearing at 400bps, and the Class D Notes offered at R20m, bid at R40m, clearing at 475 bps.

Whilst the recent tightening of liquidity has meant access to conventional funding sources has reduced – at least temporarily – for non-banks, healthy appetite for securitisation among investors has led to transaction volume rising materially this year.

The approval and launch of the securitization programme is significant for TUHF as it achieves three significant strategic initiatives, 1) diversification of investors 2) access to the debt capital markets for listed, rated debt and 3) access to lower priced debt

TUHF has a proven track record showing over a decade of commercial viability and social impact. For the past 15 years, TUHF has driven social change and economic empowerment in inner cities while simultaneously delivering returns for investors.

“The successful pricing of our securitisation demonstrates investor’s confidence in our long-term capital model. This new securitisation facility will enable TUHF to grow it’s financing of inner city development projects in all major city centres of South Africa, directly improving rejuvenation and meeting the high demand for affordable accommodation downtown.” – TUHF Representative

The Notes are being issued by TUHF Urban Finance (RF) Proprietary Limited (the “Issuer”) and TUHF Urban Finance Security SPV (RF) Proprietary Limited is the security vehicle that holds the mortgage bonds. The Issuer will be the sole obligor of the Notes; the Notes will not be obligations of, or guaranteed by TUHF or any of its other subsidiaries. TUHF has been appointed as the servicer of the loans securing the Notes.

The Debt arranger to the transaction is Africa Frontier capital and PWC Corporate Finance.