NZX Announcement
1 April 2020
New Zealand Government commitment to extending the Crown Liquidity Facility with LGFA
The Crown Liquidity Facility was established in December 2011 between Central Government and LGFA under the Local Government Borrowing Act (2011) and provides LGFA with the ability to borrow up to $1 billion from NZ Treasury.
The facility is due to expire in December 2021 and the Minister of Finance has today announced the following
“The LGFA plays a preeminent role in providing finance to the local government sector, with current loans of $10.7 billion to its sixty-seven member Councils. The facility assures prospective lenders so that Local Government is able to borrow at competitive interest rates, meaning lower costs for member Councils and ultimately taking pressure off ratepayers.
I am announcing, on behalf of the Crown, that I will extend the Crown liquidity facility with the Local Government Funding Agency (LGFA), consistent with section 15(1) of the Local Government Borrowing Act. The facility is currently due to expire in December 2021. We're making this announcement now to clearly signal our intention to ensure Councils continue to access funding at competitive rates through the LGFA.
The existing Crown liquidity facility of $1 billion has never been utilised but, given the LGFA’s strategic significance, we feel it prudent to signal to the market our intention to extend this agreement for the long term”
LGFA welcomes the commitment by Central Government as the Liquidity Facility plays an important role in supporting LGFA to deliver low cost financing to the Local Government sector.
Released on behalf of NZ Local Government Funding Agency Limited by Mark Butcher, Chief Executive.
Telephone +64 4 974 6744
Email mark.butcher@lgfa.co.nz
Website lgfa.co.nz