Investment Security
When you invest your hard-earned money, you're looking for both a sound return and peace-of-mind.
So while striving to provide competitive and attractive products and services, we've also made a commitment to offer you quality, safety and security.
Our policies and controls have produced a consistent record of stability and growth and helped form a strong foundation for the future.
When making the decision to invest, the following facts may help answer some of the questions you may have:
Australian Government guarantees deposits
On 12 October 2008, responding to volatility in the global financial markets, the Prime Minister announced that the Australian Government would guarantee deposits held by Wide Bay Australia customers up until 12 October 2011.
The Government Deposit Guarantee currently applies to deposits of up to $1million per entity and applies to deposits held by all types of legal entities (including individuals, partnerships, businesses and trusts).
Wide Bay Australia's accounts covered by the Guarantee » (PDF, 41KB)
The Government was able to provide the Guarantee to our customers as Wide Bay Australia Ltd is a recognised Authorised Deposit-taking Institution (ADI) which operates under the Banking Act 1959 and is prudentially supervised by the
Australian Prudential Regulation Authority (APRA).
Specific information about the Guarantee including Questions & Answers can be found on the APRA website at
http://www.apra.gov.au/Guarantee-of-Deposits.cfm.
We welcomed this move which provided further reassurance to our customers that their deposits are secure.
Background:
In late 2008, global financial markets experienced some of the most challenging conditions ever witnessed with governments around the world taking unprecedented steps to guarantee the liabilities of their financial systems.
The Australian financial system demonstrated its resilience to the international financial market turbulence. Australia’s banking institutions are sound, well-capitalised and profitable with high asset quality.
Guarantee on Deposits:
However, in response to these developments the Australian Government decided to guarantee deposits at banks, building societies (such as Wide Bay Australia) and credit unions which are authorised to accept deposits by APRA and are subject to prudential regulation to protect the safety of these deposits.
The Australian Government Guarantee applies to deposits held by all types of legal entities in Australia, including individuals (including joint accounts), partnerships, businesses, trusts and government entities.
Initially all deposits were Australian Government Guaranteed – however after 28 November 2008 the Government applied the following conditions:
- If an individual legal entity’s total deposits with Wide Bay Australia are less than or equal to $1million, they are covered by the Australian Government Guarantee at no charge. The Guarantee is legislated as part of the Financial Claims Scheme (FCS) and at the end of the three-year period, the Government will review the Guarantee.
- If a legal entity’s total deposits are more than $1million ("Large Deposit"), the entity could ‘opt in’ for the additional funds over $1million to be covered by the Government Guarantee by paying a Government Guarantee Fee. The Government Guarantee Fee was levied at an annualised daily percentage rate determined from time to time and charged monthly in arrears.
However, from 31 March 2010, the Government closed the Guarantee Scheme to 'large' Deposits (over $1million).
The Government believed that financial market conditions had improved to the point where the Guarantee Scheme on Large Deposits was no longer required.
The final date on which Wide Bay was able to establish a new guaranteed 'large' deposit account with the payment of the relevant Government Guarantee Fee was 31 March 2010.
The guaranteed holdings of depositors with existing 'large' guaranteed deposits were capped at their guaranteed balances on this date. In other words, 'large' depositors (term and on-call) are not now able to increase the guaranteed amount above their closing balance on 31 March 2010. Any increase (including interest) to the balances of 'large' guaranteed accounts (term and on-call) above their closing balances on the 31 March 2010 is not guaranteed.
For existing guaranteed 'large' deposits, Guarantee Scheme Fees will continue to apply throughout the period for which the Guarantee applies under these Terms & Conditions – Australian Government Deposit Guarantee for Large Deposits (PDF, 49KB)
"Large" Term Deposits covered by the Guarantee Scheme by close of business on 31 March 2010 continue to be covered for their term (up to five years). They will be covered up until maturity. Upon maturity, the Guarantee will not be available on the amount over $1million of deposits per customer per institution. 'Large" On Call Deposits covered by the Guarantee Scheme by close of business on 31 March 2010 are covered for a period of up to 67 months (5 years plus a claims period) after 24 March 2010.
Customers should be aware that even without the availability of the Government Guarantee on Large Deposits, Wide Bay Australia's operations remain extremely sound and profitable and our policies and controls have produced a consistent record of stability and growth - even throughout the Global Financial Crisis.
Built on a Strong Foundation
Our history demonstrates a solid record of strength, growth and stability.
Supervision and Regulation
Australian Prudential Regulation Authority:
We are supervised by the Australian Prudential Regulation Authority (APRA) - as are other building societies, banks and credit unions.
APRA is responsible for prudential supervision - that is the promotion of safety and soundness by these institutions.
APRA provides a consistent approach to the supervision of both banks and building societies including capital adequacy standards.
Capital is the cornerstone of an Approved Deposit Taking Institution's strength. The maintenance of adequate capital reserves can engender confidence in the financial soundness and stability of the institution by providing continued assurance that the ADI will continue to honour its obligations to depositors and creditors.
Australian Securities and Investments Commission:
Another body responsible for protecting account-holders and shareholders is the Australian Securities and Investments Commission (ASIC).
ASIC protects consumers from misleading and deceptive conduct, and also regulates matters affecting incorporation, corporate governance and disclosure.
ASIC has also issued Wide Bay Ausralia with a Financial Services Licence (Number
239686).The Licence is required under the Financial Services Reform Act 2001.
To hold an Australian Financial Services Licence, Wide Bay Australia is required
to meet, on an on-going basis, the following criteria:
- Adequate financial resources for the performance of our activities
- Competence,
skills and experience to provide financial services
- Adequate systems for
training and supervision of our representatives
Australian Stock Exchange Limited:
As a listed company on the Australian Stock Exchange Limited (ASX), we are required to meet strict reporting and disclosure requirements.
Our shares have traded on the ASX since 1994, and have consistently performed strongly.
Quality Lending Portfolio
A significant aspect of Wide Bay's operations is our lending activities.
The majority of our loans have been restricted to residential purposes secured by registered mortgages.
We also have a policy of insuring residential home loans - with a loan to valuation ratio (LVR) of 75% or greater - with lenders mortgage insurance - arranged through an approved and registered lenders mortgage insurance company. This insurance helps protect us against loss in the event of default by a borrower and provides additional comfort to depositors and investors.
Disclosure
We provide on-going disclosure and reporting required by various regulatory bodies.
We also conduct an Annual General Meeting each financial year.
Progressive results are available to depositors through a Half Year Report and details of the full year's activities are available through an Annual Report.
These Reports include information on our activities, statements by the Directors in relation to our performance, and a Report by an external independent auditor.
We are always pleased to assist you with your queries and provide further information.
