RCB Bonds PLC announces the launch of the Royal Masonic Benevolent Institution Care Company 6.25% Sustainable Bonds due 2029
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RCB Bonds PLC (“RCB”) announces the launch of The Royal Masonic Benevolent Institution Care Company 6.25% Sustainable Bonds due 2029 (the “Bonds”).
With the number of over 85s forecast to double to 3.3 million over the next 25 years, the requirement for high quality residential care and services for the UK’s ageing population is becoming ever more pressing. In the meantime much of the existing accommodation is no longer fit for purpose, with 54% of current care homes stock aged 20 years or older. The provision of this care and accommodation comes from a number of different sources spanning the public and private sectors, while charities also fulfil a critical role: reinvesting surpluses into delivering better, fit for purpose accommodation and ensuring their staff are well trained and properly paid.
RCB, a special purpose issuing vehicle, was established to help charities and ethical companies raise loan finance in the bond markets. Such loan finance enables care providers to invest in building new homes and bringing existing ones up to modern standards to support the provision of quality care. To date RCB has issued £377 million of bonds across 12 transactions for seven charities, supporting investment in projects which provide strong social impact.
The latest RCB offer is for The Royal Masonic Benevolent Institution Care Company (the “Charity” or “RMBI Care Co.”), a growing charitable organisation, which provides residential care, nursing care and residential dementia support to older people. The Charity dates back to 1842 and was originally established with philanthropic funds from the Freemasons to care for older Freemasons and their families, but is now open to the wider community.
The Charity currently delivers its care services across 16 locations in England & Wales, as well as one location providing learning disability services, with a combined total of 1,025 registered placements (as at 30 January 2023). All homes are owned freehold with a market value of £88 million as of June 2022. In addition, the Charity runs 64 sheltered units for people who are looking to retain their independence outside of a care home setting.
The Charity is a subsidiary of the Masonic Charitable Foundation (“MCF”), one of the largest grant-giving charities in the country that encourages opportunity, promotes independence and improves wellbeing for those that are in need, disadvantaged or marginalised. The Charity receives grants from the MCF in order to partly fund the fee differentials between the Charity’s full cost of looking after Masonic beneficiaries and the lower fees offered by the Local Authorities. The grant received during the financial year to 31 March 2022 amounted to approximately £6.4 million and MCF has approved a budget for grants totalling £6.7 million for the year to 31 March 2023.
The quality of care provided to residents is of paramount importance to the Charity. This has been recognised through national and local awards for a number of homes and above industry average performance in ratings awarded by the regulatory body, the Care Quality Commission (CQC), with a number of ‘Outstanding’ rated care homes. In 2022 the Charity was recognised by Carehome.co.uk as a ‘Top 20 Mid-size Care Home Group’ for the sixth year running, based on reviews submitted by residents and their families.
In line with its charitable objects, the Charity aims to maximise its public benefit. The Charity has no existing loans and any trading surpluses are reinvested to expand and improve services to its beneficiaries. As a result, the Charity is able to offer training to staff and high-quality care to residents while charging competitive and comparatively modest fees.
Occupancy of available beds stood at 85% as of 31 December 2022. The Charity currently receives approximately 130 new enquiries each month and expects that around one third of these will result in new residencies. The average age of new admissions is 92, with the average length of stay being 14 months. More than 40 residents are over 100 years of age with the oldest resident being 104.
Sustaining excellent care services defined by regulatory outcomes and family feedback has been identified as the Charity’s key to success.
The Charity has a strategy designed to replace six of its oldest and least profitable care homes over the next ten years with new state of the art care homes, some of which will be on the same sites. This recognises the need to modernise its care homes in order to be able to provide specialist end of life care services designed for complex dementia and nursing care. The Charity has completed the first of these developments, Prince Philip Duke of Edinburgh Court, which opened on 5 September 2022 and has applied for planning permission for a further care home, which can support up to 64 people, on the same site as another of its existing homes, which it will replace.
The Bonds will be issued by RCB, which was created to connect charities and ethical companies seeking unsecured loan finance with investors looking for fixed income bonds listed on the London Stock Exchange. The funds raised will be loaned, via a loan agreement, to the Charity.
The Bonds are available to wholesale and retail investors and will pay a fixed rate of interest at 6.25% per annum until 7 March 2029, payable twice yearly on 7 March and 7 September of each year, with the first coupon payment being made on 7 September 2023. The Bonds are expected to mature on 7 March 2029 with a final legal maturity on 7 March 2031.
At any time during the life of the Bonds, investors are permitted to sell the Bonds (within market hours and in normal market conditions) on the open market through their stockbroker.
- AJ Bell Securities Limited
- Hargreaves Lansdown Asset Management Limited
- PrimaryBid Limited
- Redmayne Nominees Limited
Allia C&C is acting as manager (the “Manager”) on the issue.
The Bonds have a minimum initial subscription amount of £500 and are available in multiples of £100 thereafter.
The offer period is expected to close at noon on 28 February 2023. RCB retains the right to close the offer early, in conjunction with the Manager. Notice will be given via RNS should this occur.
The Bonds are expected to be listed on the UK Financial Conduct Authority’s Official List and admitted to trading on the London Stock Exchange’s main market and through the electronic Order book for Retail Bonds on or around 8 March 2023.
This is the thirteenth series of bonds to be launched by RCB, following successful previous issues for Charities Aid Foundation, Greensleeves Home Trust, Golden Lane Housing, Hightown Housing Association, The Alnwick Garden Trust, The Dolphin Square Charitable Foundation and Belong Limited. In total over £375 million of bonds have been issued since 2014.
Commenting on the launch, Mark LLoyd, Managing Director of RMBI Care Co., said:
“RMBI Care Co. has proudly been caring for older people for over 180 years, founded on the belief that everyone should be able to enjoy later life. Our focus is to provide residential care, nursing care and residential dementia support, comfort and security to older people, at a pricing level that reflects our charitable status. Many of our residents uniquely benefit from generous financial support from our parent company, the Masonic Charitable Foundation, enabling us to maximise our impact by caring for some of the most vulnerable and disadvantaged members of society.
“Our most recent transformation of a home into a state of the art care facility has been met with tremendous success, running at full capacity within three months of opening and already generating a substantial waiting list. While there remains a clear need for quality end of life care, society’s needs are evolving and we are seeing growing demand from younger retired people who desire some support around their day to day living but still wish to retain their independence. A successful bond issuance will enable us to become even more innovative in meeting the wider needs of our communities and increase the number of people that we can support.”
Adrian Bell, CEO of Allia C&C, said:
“Allia C&C is pleased to be launching this bond for RMBI Care Co. The provision of high-quality later life care is a hugely important social issue and RMBI Care Co. is recognised as a provider of choice and excellence in the registered care market for older people. The RCB platform plays a vital role in enabling charity borrowers to access the growing demand for investment opportunities that create positive impact and raise funding for growth.”
John Tattersall CBE LVO, chair of RCB Bonds PLC, added:
“This latest bond launch represents our platform’s thirteenth issue, clearly demonstrating that the uniformity of our structuring and on-lending process continues to prove efficient and work for a variety of different organisations. The RCB programme has now delivered £377 million for a wide range of charities delivering strong social impact.”
For enquiries, please contact:
Dido Laurimore, Ellie Sweeney, Neel Bose
|Tel: +44 (0)20 3727 1000
|Tel: +44 (0)20 3039 3452|
About RMBI Care Co.
RMBI Care Co. provides residential care, nursing care and residential dementia support to older Freemasons, their families and people in the wider community. We have been caring for older people for over 180 years and today, we support over 1,000 residents across 17 care homes in England and Wales with a focus on wellbeing and quality outcomes.
We treat each person as an individual. We believe that everyone should be able to enjoy later life and we are here to help our residents stay as independent as possible. Above all, we live by our values – kind, supportive and trusted.
For further information about the Charity, please go to https://www.rmbi.org.uk.
RMBI Care Co. is part of the Masonic Charitable Foundation – Funded entirely by Freemasons, MCF builds better lives by encouraging opportunity, promoting independence and improving wellbeing. For more information, please visit: mcf.org.uk
About Allia C&C
Allia C&C is a leading expert in socially responsible finance, working to amplify economic and social impact. It supports a range of organisations that span the impact spectrum, from charities through to businesses that act responsibly – facilitating their access to the most appropriate and optimal funding for their needs from investors who are interested in creating impact.
The team at Allia C&C were responsible for the creation of the RCB platform and have managed each of its bond issues.
Allia C&C is a trading name of City & Continental Ltd, an Allia company.
For more information please see alliacc.com
RCB Bonds PLC is a public limited company, established as a special purpose issuing vehicle. It is governed by an independent and experienced board of directors from the financial and charity sectors who are acting on a pro-bono basis. The administration of RCB is carried out by Allia Bond Services Ltd, a subsidiary of Allia C&C.
For more information please see https://rcb-bonds.com
About the Bonds
- The Bonds may not be suitable for all investors. Investors should ensure they fully understand the risks and seek independent financial advice.
- Investors should note that the market price of the Bonds can rise and fall during the life of the investment and the price of the Bonds could fall below the issue price of £100.
- In the event that RCB Bonds PLC or The Royal Masonic Benevolent Institution Care Company becomes insolvent or goes out of business, investors may lose some or all of their investment.
This announcement is an advertisement within the meaning of Article 2(k) of Regulation (EU) 2017/1129 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018 (the “EUWA”) (the “UK Prospectus Regulation”) and is not a prospectus for the purposes of the UK Prospectus Regulation. A prospectus dated 30 January 2023 (the “Prospectus”) relating to the Bonds has been prepared and made available to the public in accordance with the UK Prospectus Regulation.
The Prospectus is available on the website of RCB Bonds PLC (https://rcb-bonds.com/bonds/rmbi. A key information document (“KID”) pursuant to Regulation (EU) No 1286/2014 as it forms part of domestic law by virtue of the EUWA has been prepared by RCB Bonds PLC in connection with the Bonds. A copy of the KID is also available on the website of RCB Bonds PLC (https://rcb-bonds.com/bonds/rmbi).
The Prospectus has been approved by the Financial Conduct Authority (the “FCA”) as competent authority under the UK Prospectus Regulation. The FCA only approves the Prospectus as meeting the standards of completeness, comprehensibility and consistency imposed by the UK Prospectus Regulation. Such approval should not be considered as an endorsement of RCB Bonds PLC, The Royal Masonic Benevolent Institution Care Company or the quality of the Bonds that are the subject of the Prospectus.
Potential investors should read the Prospectus before making an investment decision in order to fully understand the potential risks and rewards associated with the decision to invest in the Bonds that are the subject of the Prospectus. Investors should not subscribe for any bonds referred to in this announcement except on the basis of information in the Prospectus.
The restriction on financial promotions contained in section 21(1) of the Financial Services and Markets Act 2000 does not apply to this announcement by virtue of article 70(1A) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended.
The offering and the distribution of this announcement and other information in connection with the offer in certain jurisdictions may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
This announcement does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase any Bonds. Any purchase of Bonds pursuant to the offer should only be made on the basis of the information contained in the Prospectus.
The Bonds have not been and will not be registered under the United States Securities Act of 1933 (as amended, the “Securities Act“) and, subject to certain exceptions, may not be offered or sold within the United States or to United States persons. The Bonds are being offered and sold outside of the United States in reliance on Regulation S of the Securities Act.