|7.1||When was Finbond Mutual Bank established?
Finbond commenced trading in 2003, was listed on The Johannesburg Stock Exchange (ALT X) in June 2007 and received its Mutual Banking license from the South African Reserve Bank on
23 July 2012.Finbond transferred its Johannesburg Stock Exchange listing from the Alt t X to the Main Board in March 2014.
|7.2||Which regulatory bodies regulate Finbond Mutual Bank?
Finbond Mutual Bank is regulated by the South African Reserve Bank and operates under banking license number 01102. Finbond Mutual Bank is also an authorised financial services provider regulated by the Financial Services Board with FSP number 44907. Finbond Mutual Bank is further also regulated by the National Credit Regulator and operates under certificate number NCR CP6172.
Finbond Mutual Bank’s controlling shareholder Finbond Group Limited is listed on the Main Board of the Johannesburg Stock Exchange and fully comply with the JSE Listings Requirements , the JSE’s Rules and Regulations and the King III Corporate Governance Code.
|7.3||How is it possible for Finbond Mutual Bank to offer interest rates that are above the rates obtainable elsewhere?
The current rates offered by Finbond Mutual Bank is a limited offer that will not be available indefinitely.
Finbond’s Micro Credit division owns 253 micro finance branches in South Africa and charges its clients 5% interest per month for short term credit transactions up to 6 months and amounts up to R 8 000 as allowed by the National Credit Act. For unsecured credit transactions over R 8 000 and longer than 6 months, we charge to the following calculation: [((Repo Rate x 2.2) + 20%] per year. Given this higher margin that Finbond earns in its Micro Credit division it is able to pay depositor’s a superior above average rate of return.
For the twelve months ended February 2016 Finbond granted short term loans of R 760.4m and received cash payments of R 1104.5m from micro finance clients. Finbond Mutual Bank has a credit client base of 602 797, 162 014 active monthly clients.
|7.4||What interest rates does Finbond Mutual Bank pay on a Fixed Term Deposit?
Finbond currently pays between 6.50% and 9.65% interest depending on the term of the Fixed Term deposit. The minimum term is 6 months and the maximum term is 72 months. Please see Interest Rate Sheet and Product Rules for further details.
|7.5||How often can interest be paid?
Interest can be capitalised or paid monthly, quarterly, half yearly or yearly. Please see Product Rules for further details.
|7.6||How is interest calculated?
Interest at the applicable rate for the savings and investment account shall be calculated on the daily credit balance on the savings and investment account and capitalised monthly in arrears, subject to any product rule.
If for example you invest R1 million in Finbond Mutual Bank’s fixed term deposit product for a period of 5 years, you will have the choice of having your interest paid out to you during the period of the term (as per your chosen frequency of either monthly, quarterly, semi- annually or annually), or all at once at the end of the contract in which case interest is capitalised monthly and compounded.
|A)||Should you opt to have your interest paid to you during the term of the period (no matter how frequently); you will earn simple interest at the negotiated rate, for example 10% per annum on this product. This means that you earn a total of R 100,000 on your investment in every year that your R1 million is invested with Finbond Mutual Bank, regardless of how frequently you opt to have this paid out to you. This adds up to R 500,000 over the full five-year period of the investment.|
|B)||Should you opt to have your interest capitalised over the term of the product and paid out only upon maturity thereof, then your interest compounds monthly, which means it is added to the capital balance of your investment, and the effective rate earned in each year is actually higher than the negotiated coupon rate, for example 10%. In the same example above, the average nominal compound interest rate works out to just over 12.9%. This is because the compounding effect gives rise to additional interest earned upon the interest capitalised, thereby increasing the yield on your investment. The aggregate interest earned over the full five year term on your R 1 million under this option is R 645,308.93, all of which is paid out with your capital upon maturity of the investment.|
|7.7||What is the minimum investment amount?
R100 000 (one hundred thousand rand). Please see Product Rules for further details.
|7.8||What is the maximum investment amount?
R 15 000 000 (fifteen million rand). Please see Product Rules for further details. R 20 000 000 (twenty million rand) for Permanent Interest Bearing Shares
|7.9||Is the interest and capital guaranteed on the Finbond Mutual Bank fixed term deposit
Yes, both the interest and capital are guaranteed on all Finbond’s Fixed Term Deposit and Investment products by Finbond Mutual Bank.
|7.10||Does the South African Reserve Bank guarantee my deposit?
The South African Reserve Bank does not guarantee individual deposits but regulates the banking environment in South Africa and sees to it that all banks adhere to all laws and regulations and that all banks including Finbond Mutual Bank adheres to the minimum regulatory capital and liquidity requirements.
|7.11||Are there any initiation fees or monthly administration fees payable on the Finbond
Mutual Bank Fixed Term Deposit or Investment Product?
No, there are no initiation fees or monthly administration fees payable on the Finbond Fixed Term Deposit or Investment Products.
|7.12||How does the investment process work to invest in a Finbond Mutual Bank Fixed Term Deposit?|
|•||We send you an Application form, Interest Rate Sheet, Product Rules, Terms and Conditions and an Information Memorandum with some Frequently Asked Questions to read through.|
|•||You complete and sign the application form.|
|•||You send the signed application form to us together with the required FICA documents and proof of payment as set out in 7.14 below. (All copies to be certified)|
|•||You pay the investment amount into Finbond Mutual Bank’s ABSA Bank. (You must please use your ID number as reference number). Bank account details will be provided once the application and required FICA documentation has been approved and you have been informed of the approval of your application.|
|•||We send you confirmation of your Investment and of the opening of your Fixed Term Deposit Account via e-mail or post as selected by you. This confirmation will include the Investment Type, Account Number: Starting Date, Maturity Date, Investment Amount, Interest Rate Per Annum and the Interest Disposal Frequency.|
|•||No cash payments/deposits are allowed.|
|7.13|| Where should the application form be handed in?
The completed application form should be faxed to us at 0866209267 or you can have it scanned in and e-mail it to us at firstname.lastname@example.org or to the Finbond Mutual Bank Deposit and Investment officer that you dealt with or you can post it to us at Finbond Mutual Bank PO BOX 2127 Brooklyn Square 0075 For Attention : The Fixed Term Deposit Officer.
|7.14||What should accompany the application form?|
|•||A certified copy of your ID document.(Not older than 3 months)|
|•||A certified copy of proof of your residential address.(Not older than 3 months)|
|•||Proof of the payment of the investment amount / the deposit slip ( You must please use your ID number as reference number)|
|7.15|| When do I start to earn interest?
You start earning interest on the Date of the Investment which is the date that that the cheque or electronic funds transfer of the Investment amount has been unconditionally credited to Finbond Mutual Bank’s account with its bankers ABSA Bank Limited.
|7.16||If I invest after month end (between the start and end of the month for example on the 15th) when will I get my first interest payment?
Interest will be paid on the last working day of that same month on a pro rata basis, should the amount be deposited 5 working days prior to the last working day of the month. Should the amount be deposited within the last 5 working days prior to the last working day of the month, the pro rata interest will be paid with the following months interest.
|7.17||How, when and where do I pay the investment amount
The investment amount should be paid into Finbond Mutual Banks ABSA Bank Account by cheque or electronic funds transfer after you have completed the application form and submitted or want to submit the application form and the certified FICA documents and the proof of payment to us.
All cheques to be deposited into the savings and investment account must be made payable to Finbond Mutual Bank and deposited into Finbond Mutual Bank’s ABSA Bank Account. Bank account details will be provided once the application and required FICA documentation has been approved and you have been informed of the approval of your application. Please use your ID number as reference number.
All electronic fund transfers made into the savings and investment account must be transferred to Finbond Mutual Bank’s ABSA Bank Account. Bank account details will be provided once the application and required FICA documentation has been approved and you have been informed of the approval of your application. Please see Terms and Conditions 3.6 and 3.8 for further details. Please use your ID number as reference number.
|7.18||What is Finbond Mutual Bank’s minimum regulatory capital requirement as imposed by the South African Reserve Bank?
Finbond’s minimum regulatory capital requirement is in excess of R 250 000 000 (two hundred and fifty million rand).
|7.19||What are Finbond Mutual Bank’s total assets?
Finbond’s total assets amount to R 1 431 Billion on 29 February 2016.
|7.20||How many employees does Finbond Mutual Bank have?
Finbond has 908 employees at this time.
|7.21||Who are Finbond Mutual Bank’s Directors?
At the core of the business of Finbond Mutual Bank are the intellectual capital, experience, commitment and proven skills of its management. The senior management is a blend of experienced high profile individuals with many years of management experience in the banking and financial services sector, all with proven track records of success, and corporate entrepreneurs with a flair for business. See Directors page above for names, ages, qualifications and experience of all Finbond Directors. Also available at www.finbondmutualbank.co.za.
|7.22||What tax is payable by individuals on the interest earned on a Fixed Term Deposit
Income tax is payable according to the normal tax tables for individuals which calculates an individual’s marginal tax rate and varies depending on each individual’s taxable earnings in a particular tax year.
|7.23||What tax is payable by individuals on the dividends earned on the Finbond Mutual Bank Indefinite Period and Fixed Period Shares
In the February 2012 annual budget speech, an implementation date of 1 April 2012 for Dividends Withholding Tax (DT) was announced (replacing Secondary Tax on Companies or STC), made effective by way of notice in the Government Gazette on 20 December 2011 and the latest amendments made by the Taxation Laws Amendment Act, No 24 of 2011, promulgated on 10 January 2012.
DT is a tax imposed on shareholders by sections 64D to 64N of the Income Tax Act, (the Act) at a rate of 20%, on the receipt of dividends. The DT is categorised as a withholding tax like PAYE, and works in much the same way, with the tax being withheld and paid to SARS by the company or bank paying the dividend, and not the person liable for the tax, i.e. the beneficial owner of the dividend.
|7.24||What happens to my Investment in the event of my death?
In the event of death the Investment can be paid out to a nominated beneficiary (on your prior instruction.) If there is no prior instruction on file at the time of death the investment will be paid out to your estate.
Please request a beneficiary form if you wish to nominate a beneficiary.
|7.25||The Application Form requests a decision whether the investment is to be reinvested at maturity. Is this to happen just once off or perpetually?
This is to happen just once. Approximately 30 days before the maturity of your investment you will receive a system generated ”Expiry Letter” notifying you that your investment is maturing in 30 days and requesting you to contact us if you want to change any instructions given at the time of making the investment.
|7.26||What will happen to the interest rate/s applied to my investment/s if Finbond Mutual Bank changes the interest rate during the term of my Fixed Term Deposit and or Fixed Period Paid up Shares investment?
Your interest rate will remain the same for your entire contracted term as per your Application form completed. For example, should you have invested in a Fixed Term Deposit, at a rate of 10% per annum at the start or your contract date and Finbond Mutual Bank changes the interest rate of the Fixed Term Deposits to example 9.5%, your interest rate will remain at 10% until the end date as stipulated on your application form. At the end of the term, you can choose to re-invest the funds at the interest rates applicable at that point in time.
|7.27||Where is Finbond Mutual Bank Head Office situated? (MAP)
Finbond Mutual Bank is situated on the corner of Veale and Fehrsen Street, Nieuw Muckleneuk, Pretoria. Please see Map below