£millions for PFI fire stations was borrowed from French and German banks

£millions for PFI fire stations was borrowed from French and German banks

£millions for PFI fire stations was borrowed from French and German banks

                                            

The three boxes on the left are the PFI fire stations contract
The three boxes on the left are the PFI fire stations contract

There are many people who know more about accountancy than I do. I look forward to reading their comments on this. Below are links to the funding documents, which is part of the Merseyside Fire and Rescue Authority PFI fire stations contract that I wrote about yesterday. I received a copy of the contract from Merseyside Fire and Rescue Service when I exercised a right under s.15 of the Audit Commission Act 1998 c.18 to inspect and receive copies of the contract.

I’ve left out 4.7 (Bank Account Mandates) as this contains details of sort codes and account numbers with specimen signatures for those accounts. It’s probably better that such information isn’t published!

I find these financial documents rather confusing to understand as they use a lot of jargon. To me it seems to be an agreement to borrow up to £50,436,936 between now and 2038 from two banks (Dexia Crédit Local (a Franco-Belgian bank) and Norddeutsche Landesbank Girozentrale (a German bank)). The banks then charge interest on the money borrowed.

If anyone can tell me what the interest rate is being charged by the banks for this money (based on the documents below), please leave a comment. I’ve tried reading these documents to figure it out but it seems to be made deliberately obscure (probably because it’s a variable rather than fixed amount).

4.1 Loan Facilities Agreement

4.2 Funders PA Direct Agreement

4.3 Construction Direct Agreement

4.4 FM Direct Agreement

4.6 Account Mandate Agreement

4.8 STID

4.9 Noteholder Subscription Agreement

4.10 ProjCo Loan Note Instrument

4.11.1 Dexia ISDA

4.11.2 Nord LB ISDA

4.12 Agency Fee Letter

4.13 Arrangement Fee Letter

4.14 Equity Guarantee

4.15 Intermediate Loan Note Instrument

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