2 December 2010 ABS Building Society welcomes Federal Government support for credit unions and building societies ABS CEO Roger Cracknell has welcomed reports today that Federal Treasurer Wayne Swan will offer credit unions and building societies more assistance to allow them to grow and compete fairly with the big four banks. While the Government’s final banking package has yet to be released Treasurer Swan has publicly expressed his support for alternatives to the big banks, Roger said. “It’s great to see this acknowledgment of the role credit unions and building societies can play in offering lower interest rates and better choice to consumers who are sick of the big banks.” A recent KPMG survey confirmed the "strength, resilience and competitiveness" of the mutual banking sector. The report noted that the mutual sector's "place in the Australian financial services sector is well-deserved, with another year of strong performance, increasing profitability and balance sheet growth". “Credit unions and building societies are strong, secure and regulated the same way as banks. And they are ready to put competition back into retail banking and give Australian consumers a better deal," Mr Crackenll said. A recent national poll by Essential Research showed a growing level of dissatisfaction with the major banks, but that consumers believe there are too many obstacles to making a switch. 40 per cent said they had considered changing their main bank at some point in the last five years, but two-thirds of this group ended up sticking with their current bank. The poll also found strong support for Federal Government action to promote competition, make it easier to shift accounts and abolish exit fees, with 75 per cent of respondents agreeing that the Federal Government needed to do more to encourage competition. Roger Cracknell said that credit unions and building societies offer genuine choice to consumers, offer consistently better home loan rates, and access to fee free national ATM networks. “We welcome the Federal Government’s support. Any initiatives that help credit unions and building societies to compete on a level-playing field will help to keep the big banks honest and give customers a real choice,” Roger said. “Major bank customers can vote with their feet and move their banking to a credit union or building society. If people want to know more, we encourage them to go to comesbacktoyou.com.au to find out the credit union or building society for them.” Mr Crackenll said.
Monday 20 September, 2010 For immediate release ABS AND GREATER BUILDING SOCIETY ANNOUNCE PLANS TO MERGE ABS Building Society (ABS) and Greater Building Society have today announced plans to merge. Both Boards have agreed to a proposal that will see the transfer of business from ABS to the Greater. The merger requires the approval of ABS members as well as Australian Prudential Regulation Authority and Australian Securities and Investments Commission. He said that the merger was a “good fit” because both organisations had similar values, a commitment to being a mutual, a proud history of serving regional communities, and a focus on providing low fees and superior customer service. “ABS has had a close working relationship with the Greater over the past ten years and I believe that Greater has the closest cultural fit to our own,” said Mr Hanlan. Greater chairman John Kilpatrick said the Greater already had branches in Gunnedah and Tamworth and the proposed merger was an effective and logical way for it to expand its services in the New England and Northwest regions. Greater CEO Don Magin said ABS customers would benefit from lower home loan interest rates, competitive deposit accounts, lower fees and additional products such as credit cards. “The Greater has a proud history of service in the region and has been actively considering opening a branch in Armidale,” Mr Magin said. Mr Hanlan said that a Member Information Pack will be made available to all ABS members in the near future in order for them to make an informed decision on the proposed merger. A vote is expected to be held by before the end of the year. Subject to approvals, the transfer of operations is expected to commence on 1 January 2011. One of Australia’s Top 200 private companies (BRW 2010), the Greater has 66 branches across regional NSW and the Gold Coast, 700 staff and assets worth more than $4billion. It has an independently determined customer satisfaction rating of 95 per cent. The Greater has been named best building society in both the 2010 Mozo People’s Choice Awards and 2010 AFR Smart Investor Blue Ribbon Awards. MEDIA ENQUIRIES:  CHAIRMAN’S REPORT For the year ended 31 March 2010 Economic developments Australia’s economy performed much better in 2009, with Australia largely escaping a recession and 2010 recording modest growth to date. This was influenced by the government stimulus package together with Australia’s close links with Asia. But while there is reason for optimism in Australia for the year ahead, the state of the European economic community economies and the difficulties still being experienced in the USA are of real concern. In turn this could lead to a slowing in the Chinese economy which would impact Australia. Industry developments There has been intense competition for deposits in the retail banking sector as a result of a collapse in the wholesale funding market stemming from the global financial crisis. This has resulted in the banks aggressively competing for the retail dollar and has raised pricing for deposits significantly. Institutions overall have tightened credit standards which has resulted in slower loan growth. Of most concern is the fact that the majority of loans are written by the majors, who have entered the void left by the non bank lenders and the demise of two of the regional banks. After any crisis follows a major review of the industry involved in the crisis. The financial sector world wide is now under scrutiny and while there is a case for greater regulation and control of many of the practices pursued by banks throughout the United States and Europe, the Australian financial system has weathered the global financial crisis exceptionally well. Nevertheless it would appear the Australian financial system will be subject to further regulation and compliance issues. ABS is participating in the mutuals industry promotional activities. The industry body, ABACUS has recently launched a building society and credit union awareness campaign to lift awareness of mutuals in the community. ABACUS (comprising mutual building societies, credit unions and friendly societies), has been very active in promoting the value and strength of the mutual sector and has had considerable success in gaining access to politicians to ensure the mutual sectors’ views are considered in policy formulation by the government. Financial report As outlined in the Statement of Comprehensive Income the Society has recorded an increase in comprehensive income of $1,376,198. The Society considers this an excellent result, allowing for the affect of the global financial crisis and the fierce competition in the banking sector as mentioned earlier.The Society’s loan assets increased to $41,303,292 despite the fierce competition in this sector. Total assets increased by 4% to $74,414,225 during the year. The Society’s arrears on loans remains low totalling just $6,185.20 at year end with no loan balance in arrears exceeding 30 days. This demonstrates the robust risk management monitoring practices of ABS. The Society continues to hold high liquidity levels demonstrating its commitment to ensuring that members have access to their funds at all times and lending was not restricted at a time when many other financial institutions were forced to curtail lending. The Society’s capital adequacy ratio has increased to 17.26% as at 31 March 2010, up from 16.77% a year earlier. The capital adequacy ratio is substantially higher than that of the major banks and will allow the Society to grow its lending in the years ahead. Over the past 4 years capital adequacy has increased by 555 basis points.  The financial strength of the Society is best demonstrated by the increase in total members’ funds (which is the amount of comprehensive income) during the year. Members’ funds increased by $1,376,198 and now represents 15.00% of total assets. Regulation The cost of compliance continues to have a disproportionate impact on the Society. Regulatory efforts have been stepped up in recent times, with contact from APRA during the height of the GFC on a daily basis.New standards in the area of corporate governance in particular remuneration of directors and executives took effect this year in an effort to curb executive performance bonuses. Although ABS does not pay performance bonuses of any kind, the changes required the establishment of a remuneration committee to assess remuneration policies. As mentioned earlier and in response to the recent events in the global financial crisis, regulators worldwide are proposing enhancements to their prudential standards. These proposed regulatory changes could result in higher capital and tighter liquidity requirements for the banking sector. New Board members ABS welcomed a new Board member, Mrs Etoline Galbraith to the Board. Etoline is the Society’s first female director and her expertise in the area of law will be an asset for the Society. The election of an alternate director forms part of the Society’s ongoing Board renewal program and has worked exceptionally well since its inception a few years ago. Appreciation I pay tribute to the Chief Executive and his staff for their effort over the past two years which have been the worst trading conditions in the Society’s history. I acknowledge the enormous effort of my fellow directors who have contributed to the success of the Society during a very difficult time as a result of the global financial crisis. I acknowledge the contribution of the solicitors, agents and media throughout the year. Most importantly I would like to thank the members of the Society for their continued support. The year ahead As mentioned in my opening remarks, operating conditions for the year ahead will remain difficult as a result of the state of the USA and the European economies. There still exists a real threat of a double dip recession in these economies which would impact the world economy. However Australia’s economy is showing real resilience and China/Asian economies are still performing well. Given that scenario your Society will continue its conservative approach to doing business in the year ahead. Peter C. Hanlan
Notice is hereby given that the Annual General Meeting of the Society will be held at ABS Finance House, 97-101 Faulkner Street, Armidale, NSW on Tuesday 24th August 2010 at 4.00 pm. Meeting Outline:
The duly audited balance sheet and income and expenditure accounts and a copy of the director’s and auditor’s report may be inspected at the Society’s office ten days prior to the meeting. Dated at Armidale this 4 June 2010 by order of the Board. Dowload printable Notice of AGM. You can vote on a resolution by proxy. The proxy need not be a member of ABS Building Society Ltd. A Proxy appointment form, together with instructions on how to vote using a proxy, is enclosed with this notice. ABS Chief Executive Roger Cracknell said ABS is working hard through the financial crisis to continue to provide its members fair pricing and lower fees and charges. In addition, ABS is continuing to have a focus on customer service to provide the best banking solutions for its members. Mr Cracknell attributed this achievement to the customer service staff. “Staff do a wonderful job, especially the counter staff who consistently ensure that members are provided with the best possible banking experience,” he said.
ABS Chief Financial Officer, Josie Bieber indicated that ABS will report a healthy increase in comprehensive income for the 2009-2010 financial year. The Society is holding high levels of liquidity and a capital adequacy ratio substantially higher than that of its peers. “This shows that ABS is weathering the recent economic fluctuations and demonstrates ABS’s commitment to controlling costs and maintaining interest margin,” she said.
Thanks to our Local Photographers 21 July 2009 The Society is proud that it uses local photographers in the publication of images in our annual reports, brochures and other print media as well as on our website. A big thanks goes to Sue Maxwell who provided the photographs of the Dangarsleigh gorge and King parrot used on this year's annual report cover. The majority of the photographs on our previous homepage were also taken by Sue. The Society is extremely grateful for the selection of photographs provided by Sue for use in our print and digital media.
The Mutual Banking Code of Practice 01 May 2009 ABS Building Society will adopt the newly drafted Mutual Banking Code as of 1 July 2009. The new Code reinforces our commitment to member benefits, community involvement, fairer fees and customer service. It sets out 10 key commitments and specific ways we will deliver on these. We undertake to comply with this Code in all our dealings with you. We will incorporate the Code in our written Terms and Conditions for our products and services. The code replaces the old Code which was introduced in 1996. Our 10 Key Commitments
The Society has always adhered to the above principles, these principles are now documented in the code of practice. To read the whole document, follow this link: ABACUS Mutual Banking Code of Practice.
ABS Building Society puts members first again under new Thursday 28th May, 2009ABS Building Society members will be among the first Australians to be protected under a new Code of Practice for credit unions and building societies that reflects how they deal with their customers and members. The new Mutual Banking Code of Practice was developed for Australian credit unions and building societies by industry body Abacus – Australian Mutuals. The Code clearly sets out the rights of members and the responsibilities of their lenders. “ABS has already signed up to the new Mutual Banking Code of Practice. There are many compelling reasons for people to bank with us – and the Code sets them out in plain English,” says ABS Chief Executive Roger Cracknell. The new Mutual Banking Code of Practice draws on existing lending practices in the industry, and puts into print the expectations of both lenders and members where service, advice and price are concerned. “Credit unions and mutual building societies in Australia offer a genuine and competitive alternative to the banks,“ says Abacus CEO, Louise Petschler. “Credit unions and mutual building societies continue to take the lead where responsible lending is concerned – and the new Mutual Banking Code of Practice puts into writing the guidelines for real service and value for ABS Building Society members,” says Mr Cracknell. “At ABS we’ve always been community-focused and the new Mutual Banking Code of Practice sets out in plain English the responsible approach we take in meeting our members’ needs,” says Mr Cracknell. For more details You can get a full copy of the Code at any of our branches or by visiting: http://www.absbuildingsociety.com.au/ The Code includes detailed provisions on how we will handle fees and interest rates, credit limit increases, guarantees, account statements, chargebacks, members in financial difficulty, debt recovery, reverse mortgages, finance broking and complaints. Changes to terms and conditions The terms and conditions of your accounts will not change, however, the way we tell you about changes to your account will change a little, for the better. From now on:
We will notify you of an increase in the interest we charge on your loan or credit facility no later than the day on which the change takes effect. We will also advise you of any new minimum repayment amount. We will notify you of other changes to your account when we next communicate with you. Telling you about changes to terms and conditions We may notify you of changes in these ways:
In deciding the method of notification, we will consider the nature and extent of the change as well as the cost and effectiveness of different methods of notification. The new code of practice will be available on the Society’s website from 1 July 2009. |
ABS BUILDING SOCIETY LIMITED | 101 Faulkner Street ARMIDALE NSW 2350 | 02 6772 5522 | info@absbuildingsociety.com.au | ABN: 84 087 651 938 | AFS: 247389