We are dedicated to being the leading provider of finance solutions to South Australian councils and prescribed local government bodies. We offer a range of competitive loan and investment products to our members.
All South Australian Councils are automatically Members of the Local Government Finance Authority of South Australia, but use of LGFA services for investment and loans is entirely voluntary.
LGFA members have good reason to be confident in their dealings with the Authority as, in accordance with Section 24 of the Local Government Finance Authority Act, 1983.
Members who support the Authority by depositing money or using loan facilities share in the LGFA’s success via special distributions (previously known as the bonus) and it is paid on a pro-rata basis.
Fixed Credit Foncier borrowings are a loan with equal repayments (usually semi-annual) comprising principal and interest, over the life of the loan and where all the principal is repaid over the life of the loan. The repayment schedule is agreed on inception of the loan and fixed for the duration of the loan. The loan amount is drawn in one payment.
Generally longer-term loans that may meet the need to fund longer-lived assets.
Fixed Rate Interest Only Borrowings are loans where only interest is paid over the life of the loan. The repayment schedule is agreed on inception of the loan and fixed for the duration of the loan. At the end of the loan the principal is repaid in a lump sum, although it may be re-financed.
Generally longer-term loans that may meet the need to fund longer lived assets.
The principal needs to be refinanced or repaid at maturity.
Like a Bank, LGFA offers other variations of Fixed Rate lending such as Split Term and Low Start options.
Is a loan where a residual or balloon repayment is required to be repaid or refinanced at maturity, as the periodic repayments do not fully repay the principal amount during the term of the loan.
Is a loan where the initial payments (which may be zero) do not fully cover the principal and interest. The repayment schedule is structured to have increasing repayments so that loan is repaid in full by the end of the loan term.
Pro’s and Con’s are the same as other fixed rate borrowings as previously described.
In addition with low start fixed rate credit foncier borrowings, the repayments will be more easily accommodated by Councils as inflation over time will reduce the impact of the higher repayments later in the loan.
These are very flexible facilities that can be used as a floating rate facility or fixed for varied periods on an interest only basis. South Australian councils predominately use these facilities on a floating rate, come and go basis meaning the principal can be drawn down or repaid with 24 hours’ notice.
Generally longer-term loans that may meet the need to fund longer lived assets.
The LGFA provides access to competitive loan rates to the Local Government sector.
LGFA do not charge fees for its lending services and provide terms up to 15 years.
Borrowers will also participate in the LGFA's annual bonus payment based on their average loan business with the LGFA.
Councils obtain loan funds secured by a debenture charge over their general revenue.
An expansive range of borrowing options is available, for example:
Councils can place funds with the Authority on the following terms:
Funds on deposit will earn a competitive interest rate return and will participate in the LGFA’s annual bonus payment to councils and prescribed bodies. These bonus payments are based on the average deposit and loan business each individual client conducts with the LGFA.
Deposits are safe and secure as under the Local Government Finance Authority Act 1983 all deposit funds are guaranteed by the Treasurer of South Australia.
Councils can advise the Authority of their lodgement and withdrawal instructions via the LGFA online portal. The LGFA will direct debit or instantaneously transfer funds to a council bank account as requested.
