Secondary Coop Bank Coop Bank SA PRESENTATIO OF
Secondary Co-op Bank: Co-op Bank SA PRESENTATIO OF CFI INDABA
SCB: Background and Context An NACIFSA decision Presented at the 2013 CFI Indaba SCB Working Group formed Part of the project to access national payment system through a CFI Banking Platform • To be open all registered CFIs. • Plan of Action developed. • •
Process so far Survey Business Plan Constitution Policies • Survey exercise conducted • Planning Committee formed since last CFI Indaba • 3 workshop sessions with CFIs held since Jun’ 14 • Draft Business Plan prepared • Draft constitution, based on CBDA model constitution • Organisation, governance, savings, loans and other polices are being presently drafted.
Process going forward CFIs consultations Registration Launch • Presentation to 2014 CFI Indaba • Individual engagement registered CFIs – next 3 months • Registration as a secondary co-op bank with SCB, Between Nov’ 14 and Jan ‘ 15 • We expected to hold the Inaugural Meeting in Apr’ 15 • The Launch - at next 2015 CFI Indaba!
Why secondary co-op bank? • Provide services that individual CFI cannot do on their own including: – wholesale banking services ( savings, loans, investments) to CFI who provide retail banking services; – to enable access to national payment system – (access to ATMs, credit or debit cards, etc) – To manage the co-op banking platform on behalf on CFIs
What does it mean for CFIs? • Secondary Co-op Bank – which will be known as Co-op Bank SA - will be: – Owned and controlled by CFIs who are its members; – Each CFI will make membership share capital contribution; – Each member CFI will open main accounts with the SCB
Main Products • Main CFI account – set competitive fee structure • Saving deposit accounts: (set at competitive rate or interest bearing account for different savings products); • Investment products – coop retail bond, research other investment products, including pension and retirements funds
Products (Continues…) • Two kind of services: – Products to CFIs – institutional members – Products for CFI members - retail • Loan products – Mortgage loan – Enterprise (including co-op enterprises) loan – Auto-loans (used and new cars) – Liquidity management facility (to assist members in need of more loans) – Consolidated Loans
Products (continues. . ) • • Co-op Bank cards (credit, debit) Internet banking Mobile Banking Other services – Salary services (transmission accounts) – Bill payment services – SMS services and Messages – Air time services • Insurance services ( including Credit Life)
Services • • Marketing and branding Technical/training and support 24/7 call Centre Policies and Procedures for CFI?
Policy Committees • 1. Governance • Management – – – HR Policy Language Policy Marketing ICT Records Management Business Continuity • Products – Loan Policy – – Savings Deposits Policy Investment Policy Dividends Policy Liquidity management
Governance - TP and MU Products - JM Constitution Membership Policy Board Charter Board Committee Policy Governance and Leadership Policy Gender Policy Language Policy Compliance and Reporting - Saving Deposit Policy Loan Policy Investment Policy Insurance Policy Dividends Policy Policies Members: 1. Nomadelo 1. Ehard (DGRV) 2. David De Jong (CBDA) 3. Alan (coop banking platform) Management - MR Operational –MR - Financial Management Operational Management Risk Management Liquidity Policy Assets Liability Management Policy Funding Policy Healthy , Environment, quality, Safety (SHE) Members: 1. Lulama Procurement Policy HR Policy Training and Education ICT Records Management Policy Business Continuity Policy Marketing Policy Members 1. Timothy (CBDA)
Concept of SCB • Where will sources of funding SCB come from? – Savings deposits from members – Interest from loans – Interest from investments – subscriptions (dues and fees) – Membership shares – Income fees ( joining, transaction, penalty) – External loans (limited to 15% of total assets) – Donations
Survey exercise • • • Savings deposit: Outsanding loan Asset size Income Expenses Surplus-Deficit
CFI Financial Data as end of Feb’ 14 Members Share p/m Income Savings Loans Assets 6, 050 R 300 R 563 745 R 9. 4 m R 9. 7 m R 10 m Distobotla 1, 300 R 150 R 10, 000 R 7. 1 m R 7. 9 m R 9 m Cebisa R 500 R 295, 258 R 1. 7 m R 1. 4 m R 2. 4 m nehawu 525 K Ladies 1, 114 R 2. 6 m Mostwedi 2, 070 R 12. 1 m Mathabat 1, 530 R 2, 5 m 852 R 3. 0 m Boikago TOTAL 13, 326 R 869, 003 R 18. 2 m 19 m R 50. 6 m
Membership structure AGM Audit + Risk Cmt. Board CFI 1 CFI 2 CFI 3
Membership • Capital structure – Internal sources of capitalization • Membership share: R 5 -million • Preferential shares? ? • Dues and Fees • Annual contributions (i. e. annual fees) Between R 15 -R 50 m needed to start-up and operate a SCB:
Capital Structure Members Share 10% R 5 m Preferential Share 25% External funding 65% R 50 m 100%
Way Forward • Next meeting to at draft documents (August 2014) • Finalise the Business Plan (August 2014 • Hold a Information Workshop with selected CFIs • Hold AGM (Early Next Year) • Start the registration process
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