Decision

Previous regulatory judgement: Hyde Housing Association Limited (29 March 2023)

Updated 29 November 2023

Applies to England

RSH Narrative Regulatory Judgement

• Provider: Hyde Housing Association Limited
• Regulatory code: LH0032
• Publication date: 29 March 2023
• Governance grade: G1
• Viability grade: V2
• Reason for publication: Changed basis for viability grade
• Regulatory route: In Depth Assessment

Regulatory judgement

This regulatory judgement confirms our previous published assessment of Hyde Housing Association Limited’s financial viability and governance grades (G1/V2) following completion of an In Depth Assessment (IDA).

Based on evidence gained from the IDA, the regulator has assurance that Hyde Housing Association Limited (Hyde) complies with the financial viability elements of the Governance and Financial Viability Standard. Its financial plans are consistent with, and support, its financial strategy. It has sufficient security, and forecasts to continue meeting its financial covenants.

Our previous judgement concluded that Hyde had reduced financial capacity to respond to adverse events as a result of material financial exposures from its sales and development programme. At the time of the last narrative regulatory judgement Hyde was exposed to material, short-term financial risks from a large treasury restructuring programme. These treasury risks have been mitigated.

Delivering the treasury strategy has increased Hyde’s financial capacity in respect of interest costs and interest cover. However, while Hyde is managing the risks in its sales and development programme, it remains exposed to the housing market. Hyde has also increased investment in its homes and expects to make further investment over the next few years alongside its development plans. In combination this reduces Hyde’s capacity to respond to adverse events.

The regulator’s assessment of Hyde’s compliance with the governance elements of the Governance and Financial Viability Standard remains unchanged. Based on the evidence gained from the IDA, the regulator has assurance that Hyde’s governance arrangements enable it to adequately control the organisation and to continue meeting its objectives.

Other providers included in the judgement

Hillside Housing Trust Limited, Hyde Southbank Homes Limited, and Martlet Homes Limited.

About the provider

Origins

Hyde is a charitable community benefit society, a registered society and the parent of the group.

Registered Entities

Hyde has three registered, wholly-owned subsidiaries: Martlet Homes Limited, Hillside Housing Trust Limited and Hyde Southbank Homes Limited.

Halesworth Limited, a for-profit registered provider jointly owned by Hyde, is not covered by this regulatory judgement.

Regulating the Standards sets out our approach to regulating for-profit registered providers.

Unregistered Entities

There are six active wholly-owned unregistered entities within the group. These are Hyde Vale Limited, Hyde New Build Limited, Brent Co-Efficient Limited, Hyde Devco 2 Limited, Hyde Holdco Limited, and Rochester Riverside Managing Agents Limited.

The group also has an interest in eight joint ventures and three special purpose vehicles with development partners, as well as the Hyde Charitable Trust.

Geographic Spread and Scale

The group operates primarily in London and the south-east.

Hyde owns and manages around 48,000 homes. Most of its homes are general needs, but it also provides homes for shared ownership, supported housing, housing for older people and leasehold management.

Staffing and Turnover

The group employs the full-time equivalent of approximately 1,100 staff. Its turnover for the year ended 31 March 2022 was £373.6m.

Development

Hyde is an investment partner with the Greater London Authority and a Homes England Strategic Partner. Its latest business plan includes planned development of 4,200 units by the end of the 2026/27 financial year.

About our judgements

Key to Grades

Governance:

	Compliant
G1	The provider meets our governance requirements.
G2	The provider meets our governance requirements but needs to improve some aspects of its governance arrangements to support continued compliance.

	Non-compliant
G3	The provider does not meet our governance requirements. There are issues of serious regulatory concern and in agreement with us the provider is working to improve its position.
G4	The provider does not meet our governance requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Viability:

	Compliant
V1	The provider meets our viability requirements and has the financial capacity to deal with a wide range of adverse scenarios.
V2	The provider meets our viability requirements. It has the financial capacity to deal with a reasonable range of adverse scenarios but needs to manage material risks to ensure continued compliance.

	Non-compliant
V3	The provider does not meet our viability requirements. There are issues of serious regulatory concern and, in agreement with us, the provider is working to improve its position.
V4	The provider does not meet our viability requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Note: The use of an asterisk (*) against a grade indicates that the assessment refers to a provider that is designated as being for-profit.

Definitions of Regulatory Routes

In Depth Assessment (IDA): An IDA is a bespoke assessment of a provider’s viability and governance, including its approach to value for money. It involves on-site work and considers in detail a provider’s ability to meet its financial obligations and the effectiveness of its governance structures and processes.

Stability Checks: Based primarily on information supplied through regulatory returns, a Stability Check is an annual review of a provider’s financial position and its latest business plan. The review is focused on determining if there is evidence to indicate a provider’s current judgements merit reconsideration.

Reactive Engagement: Reactive engagement is unplanned work which is triggered by new information or a developing situation which may have implications for a provider’s current regulatory judgement.

Stability Checks and Reactive Engagement: In some cases, we will publish narrative regulatory judgements which combine evidence gained from both Stability Checks and Reactive Engagement.

For further details about these processes, please see Regulating the Standards.