TIDMBM19
RNS Number : 9030N
Honours PLC
31 October 2016
HONOURS PLC
(the Issuer)
(Incorporated in England and Wales with registered number
03702189 and having its registered office at Third Floor, 1 King's
Arms Yard, London EC2R 7AF)
NOTICE
To the holders of those of the:
GBP291,950,000 Class A1 Asset Backed Floating Rate Notes due
2029 (ISIN: XS0273149962)
GBP54,200,000 Class A2 Asset Backed Floating Rate Notes due
2029
(ISIN: XS0273152677)
GBP33,350,000 Class B Asset Backed Floating Rate Notes due 2029
(ISIN: XS0273153998)
GBP18,000,000 Class C Asset Backed Floating Rate Notes due 2029
(ISIN: XS0273156587)
GBP11,950,000 Class D Asset Backed Floating Rate Notes due 2029
(ISIN: XS0273158443)
GBP8,750,000 Class E Asset Backed Floating Rate Notes due 2029
(ISIN: XS0273159250)
of the Issuer presently outstanding
(the Noteholders and the Notes respectively).
NOTICE IS HEREBY GIVEN to the Noteholders that:
1) as previously notified to Noteholders (in notices dated 12
February 2016 and 13 September 2016):
a) Capita Customer Management Limited informed the Issuer that
certain arrears notices sent to a portion of borrowers may not have
been in compliance with applicable consumer credit legislation. The
Issuer noted that a review was to be undertaken to determine
whether an amount would be repayable to certain of the affected
borrowers as a result of such non-compliance; and
b) on 16 February 2016, Link Financial Outsourcing Limited
(Link) was appointed to assist the Issuer with the preparation and
implementation of a remediation plan, since when Link has been
collating data and conducting an initial review of the affected
accounts;
2) the Issuer has also obtained advice from counsel with regards
to the application of the applicable consumer credit
legislation;
3) after conducting an initial review referred to in paragraph
(1)(b) above in order to prepare the remediation plan (taking into
account the legal advice referred to in paragraph (2) above), it
appears that:
a) arrears notices sent to a significant number of borrowers
were not in compliance with the applicable consumer credit
legislation. As a result of the issue of these non-compliant
notices to certain borrowers, any subsequent annual statement(s)
sent to those borrowers were also incorrect. The Issuer estimates
that accounts representing approximately 40% of the Principal
Amount Outstanding of the Loan portfolio as at 31 January 2016 are
affected;
b) as a result of the non-compliance described in paragraph
(3)(a) above, the Issuer has estimated that as at 31 January 2016
around GBP22,500,000 of interest and charges which have been
charged on the affected accounts would need to be refunded either
via account book adjustments or by way of cash refunds;
c) in addition to making the refunds referred to in paragraph
(b) above, in order to fully remediate the situation, corrective
notices and corrective annual statements will need to be sent to
all of the relevant affected accounts;
d) there may also be refunds owing by the Issuer to the
Authority in respect of affected Loans repurchased by the Authority
under the cancellation indemnity. As at 31 January 2016, the amount
is estimated to be at least GBP750,000. Amounts may also be
required to be refunded to the Authority in respect of subsidy
payments that have been made by the Authority, which amounts have
not yet been investigated and quantified;
e) for a number of reasons (including the non-standard
characteristics of the Loans), the Issuer understands that it will
not be possible for the relevant affected accounts to be remediated
through an automated process and that a manual overlay process will
need to be undertaken in respect of each affected account in order
to properly remediate them; and
f) the Issuer has been having ongoing discussions with third
parties and understands that the remediation process is going to be
a lengthy one and after an initial analysis is likely to cost in
the region of GBP5,000,000 to GBP10,000,000 for the services to
effect such remediation;
4) all of the estimated amounts set out in this notice
(including the likely costs referred to in paragraph (3)(f) above)
are estimates formulated by the Issuer on the basis of an initial
analysis conducted as at 31 January 2016 and are dependent on a
number of variables. Accordingly these estimates/amounts (i) may
significantly change after further investigations are conducted,
and (ii) will continue to increase to the extent that the affected
accounts are not remediated;
5) in light of the outcome of the initial review described in
this notice, the Issuer wishes to invite Noteholders to participate
in an informal information conference call to be held at 10.00am
(London time) on 15 November 2016, the dial in details of which
will be made available to Noteholders upon request from the Issuer
or the Note Trustee. On the call Noteholders:
a) will be given further background information surrounding the
issues highlighted in this notice; and
b) will be invited to volunteer to form a committee or
committees to represent the interests of the Noteholders of the
relevant class(es) of Notes, in order to guide and instruct the
Issuer and the Note Trustee as to the steps and procedures they
wish the Issuer to implement going forward. If Noteholders express
a wish for the formation of such a committee or committees, the
Issuer will send a further notice to Noteholders to convene a
meeting of the relevant class(es) in order for such a committee or
committees to be constituted by Extraordinary Resolution; and
6) if Noteholders do not partake in the aforementioned call and
no committee(s) (as contemplated in paragraph 5(b) above) is
established to guide and instruct the Issuer and the Note Trustee
on the steps and procedures Noteholders would like to be
implemented, the Issuer will endeavour to form a proposal to be put
to Noteholders to agree to the required remediation process, but it
should be recognised that without the engagement of Noteholders in
this process and given the very limited resources of the Issuer, it
is possible that such proposal may not optimise the situation for
Noteholders.
Capitalised terms in this notice shall, except where the context
otherwise requires and save where otherwise defined herein, bear
the meanings ascribed to them in the Transaction Master Definitions
and Framework Deed between, inter alios, the Issuer and the
Security Trustee dated 10 November 2006, copies of which are
available for inspection during usual business hours at the offices
of the Issuer set out below.
This Notice is given by:
Honours PLC,
Third Floor,
1 King's Arms Yard,
London EC2R 7AF
Attention: The Directors
Telephone: +44 (0) 20 7397 3600
Fax: +44 (0) 20 7397 3601
e-mail: Transactionteam@wilmingtontrust.com
Ref: Honours PLC
Dated: 31 October 2016
This information is provided by RNS
The company news service from the London Stock Exchange
END
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