01 September 2016

Barclays first bank to scrap LOBO loans

Barclays first bank to scrap LOBO loans image

Barclays has become the first bank to scrap high interest Lender Option, Borrower Option (LOBO) loans for councils.

The move will see more than 100 LOBO loans - thought to be worth around £8bn - converted into fixed-rate loans.

A spokesperson for Barclays said: ‘Under the changes Barclays is permanently waiving its 'lender option' to amend the interest rate at given periods. This will create certainty for the client for the duration of the loan, by locking in the fixed rate for its lifetime.’

Overall, around 240 local authorities have taken up to £15bn in LOBO loans from private banks, which charge interest rates of more than 7% in some cases.

To date, residents from 24 different local authorities have mounted legal objections to their use, claiming the loans are ‘irrational’ expenditure and therefore unlawful.

The spokesperson added: ‘Over a hundred local authorities and housing associations will benefit from greater certainty that their borrowing costs will not rise in future. They will also enjoy reduced break costs than there would have been had Barclays retained its right to change the interest rate. The original value they secured when taking out the loan at rates lower than those available publicly at the time, is now locked in for the lifetime of the loan.’

In competition with the PWLB image

In competition with the PWLB

Christian Wall considers what alternative funding channels are available to local authorities beyond the Public Works Loan Board.
Avoiding the precipice image

Avoiding the precipice

As councils seek ways to meet the funding gap, Martin Reeves and Rob Whiteman look at the implications for the future of public services and how we need a mature debate on prevention, accountability and joined up services.
Highways jobs

Change Lead, Adult Social Care & Health

London Borough of Bexley
£41,205 - £48,069
We are currently seeking an experienced Change Lead to work on our Adult Social Care Services’ transformation programme. Bexleyheath, London (Greater)
Recuriter: London Borough of Bexley

Deputy Team Manager

Brent Council
£41,847 - £44,691 p.a. inc.
An exciting opportunity has arisen in the Hospital Discharge Team (HDT) for an experienced Social Worker. Wembley, London (Greater)
Recuriter: Brent Council

Highways Estimator

Ringway
Competitive Salary
As the Highways Estimator you will join a busy environment and become an integral part of the team. Hounslow (London Borough), London (Greater)
Recuriter: Ringway

Joint Strategic Director of Commissioning 

West Sussex County Council
circa £130,000 per annum
The post holder will be able to demonstrate an understanding and embrace the opportunity to address the health... West Sussex
Recuriter: West Sussex County Council

Head of Lifelong Services

West Sussex County Council
up to £85,000 per annum
The Head of Lifelong Services will lead and deliver a new, co-produced, integrated and whole life approach and service working with people... West Sussex
Recuriter: West Sussex County Council

Local Government News

Latest issue - Local Goverrnemnt News

The December issue of Local Government News looks at the consequences a council may face if it is unable to provide statutory services, the launch of Liverpool’s housing company and how councils can best manage roles in local authority companies.

It also has a special section on green building and energy efficiency including what funding is available to enable councils to deliver heat networks and how councils can pay for ‘smart buildings’.

Register for your free magazine