notice of special general meeting

Transcription

N O T I C E O F S P E C I AL G E N E R AL M E E T I N G
Sutherland Credit Union Limited
AN 89 087 650 708
A Special General Meeting of Sutherland Credit Union Limited will be held on Friday the 15th of
February 2013, 6pm at Hazelhurst Gallery, Gymea, NSW.
AGENDA
1.
Transfer of Business from Manly Warringah Credit Union Limited
To consider and, if thought fit, to approve the following special resolution submitted by the
Board of Directors:
That the members of Sutherland Credit Union Limited approve the proposed total transfer of
business by Manly Warringah Credit Union Limited to Sutherland Credit Union Limited, and
that the proposed transfer take effect on 01/3/13 or on such other date as the Australian
Prudential Regulation Authority determines.
and
That, on the date that the transfer of business from Manly Warringah Credit Union Limited
takes effect, the Constitution of Sutherland Credit Union Limited be amended by:
(a)
replacing Rule 13.1 with the following:
13.1 Number of Directors
The credit union must have such number of directors being not less than five (5) and not more
than nine (9) as the Board from time to time determines.
(b)
replacing clauses A2-1 and A2-2 of Appendix 2 – Common Bond with the following:
The credit union does not have a common bond.
and
That, on the date that the transfer of business from Manly Warringah Credit Union Limited
takes effect, the company name of Sutherland Credit Union Limited be changed to Strategic
Partnerships Group Limited.
Notes
To be passed, this resolution requires the approval of at least 75% of the votes cast by members at
the Special General Meeting, in person or by proxy.
One member one vote prevails on a show of hands or a poll (with the possible exception that, on a
poll, members may be able to vote in different capacities.)
The reason for the transfer of business along with additional information is set out in the Information
Document enclosed with this Notice. Please read the Information Document carefully.
The resolution will also make changes required for the transfer of business to take effect as agreed
to by the boards of Sutherland and Manly Warringah. The Sutherland Constitution will be amended
to increase the maximum number of directors from 7 to 9, which is required for the merged credit
union to have 9 directors on the board after the transfer of business, and to remove the common
bond so that the merged credit union can accept new members after the transfer of business who
are not residents of, or do business in, the Sutherland Shire. The company name of Sutherland will
also be changed, although the boards intend that the merged credit union will continue to do
business under the business names Sutherland Credit Union and Northern Beaches Credit Union.
Your Board unanimously approves this proposal and recommends that you vote FOR this
resolution.
2.
Payments to Non-transferring director
If, and only if, members approve the special resolution in Agenda Item 1, to consider and, if
thought fit, to approve the following separate resolution to pay a benefit to the Director not
continuing on the board of Sutherland Credit Union:
That members approve and authorize payment by Sutherland Credit Union Limited to Bob
Manning of $15,209 on the last business day prior to the transfer of business taking effect
Bob Manning has served as a Director for 8 years. Bob is currently a member of the Nominations
Committee and the Remuneration Committee. His term is due to expire in 2013.
Notes
To be passed this resolution requires the approval of a majority of the votes cast by members at the
Special General Meeting, in person or by proxy.
The purpose of this resolution is to pay a benefit to the director who will not remain on the board
following the merger acknowledging his contribution to the Credit Union over a number of years.
resolution.
3.
Constitutional amendment – additional directors for future transfers of business
To consider and, if thought fit, to approve the following special resolution submitted by the
Board of Directors:
That the Constitution of Sutherland Credit Union Limited be amended by:
(a)
in Rule 13.1, renumbering the content as paragraph (a) and inserting the following
new paragraph (b):
(b)
(b)
If the business of another company is transferred to the credit union under the Financial
Sector (Business Transfer and Group Restructure) Act 1999 (Cth) the board may appoint up
to 3 persons who were directors of the transferring company immediately prior to the transfer
of business as additional directors. Paragraph (a) does not apply to additional directors.
The term of office for an additional director commences from the date of the transfer of
business and ends at the end of the third AGM after appointment or such earlier date as
determined by the board at the time of appointment. The board may determine the
remuneration of additional directors. Rule 17.1 does not apply in relation to the
remuneration of additional directors.
in Rule 1.1, before the definition of ‗ADI‘, inserting a new definition of ‗additional
director‘ as follows:
additional director means a director appointed by the board under Rule 13.1(b)
Notes
To be passed, this resolution requires the approval of at least 75% of the votes cast by members at
the Special General Meeting, in person or by proxy.
The purpose of this resolution is to allow the board to appoint up to 3 additional directors in the event
of any future transfer of business from another company to the Credit Union, where the additional
directors are all directors of the transferring company. This allows directors of the transferring
company to join the board without any existing directors having to vacate their office or requiring any
further amendments to the Constitution. The term of office for additional directors cannot exceed the
third AGM after their appointment. As members approve an aggregate amount of remuneration to
share between directors each year, increasing the number of directors will reduce the amount each
director can receive. To avoid this, the board will be able to determine the remuneration of additional
directors as separate amounts in addition to the remuneration approved by members.
resolution.
BY ORDER OF THE BOARD
David Harll
Secretary
Proxies
You can appoint a proxy to attend and vote at the meeting on your behalf. Your proxy does not have to be a
member of the Credit Union.
An Appointment of Proxy form is enclosed with this Notice. It includes instructions on how to vote using a
proxy. Please read these instructions carefully.
To be valid, your Appointment of Proxy form must reach the Credit Union no later than 48 hours before the
start of the Special General Meeting.
AP P O I N T M E N T O F P R O X Y
Sutherland Credit Union Limited ABN 89 087 650 708
Speci al General Meeting
th
If you cannot attend the Special General Meeting to be held on Friday the 15 of February 2013, 6pm at
Hazelhurst Gallery, Gymea, NSW and you are entitled to vote at the Special General Meeting, you may
appoint a proxy to vote on your behalf. This proxy only applies to the Special General Meeting, and any
adjournment of that meeting.
YOUR VOTE IS IMPORTANT
Please read the instructions carefully before completing this Appointment of Proxy form.
You are encouraged to use Section D (on the reverse side of this form) to direct your proxy how to
vote on each resolution.
A
YOUR DETAILS
Membership in the Name(s) of:
Membership Number
For Body Corporate Members – please provide your
ACN/ABN
Member’s Address
B
WHO DO YOU WANT TO APPOINT AS YOUR PROXY?
I appoint as my proxy (tick one box only):
Chair of the Special General Meeting
OR
the following person:
Name
Address
C
If you appoint the Chair as your proxy and direct
the Chair how to vote, the Chair must call a poll
on that vote and must vote the way you direct.
If you want to appoint someone else, give their
name and address. If you do not provide a name,
you will be taken to have appointed the Chair as
your proxy.
Your proxy can only cast your vote on a poll not
on a show of hands. If a poll is called and you
direct the proxy how to vote then the proxy can
only vote as you direct. If the proxy is not present
at the meeting when the vote is taken or chooses
not to cast your proxy vote, then you are taken to
have appointed the Chair as your proxy. The
Chair must vote the way you direct.
YOUR SIGNATURE
Individual Member or Primary Joint Member
If you have appointed someone else as your
attorney, your attorney can sign this Appointment of
Proxy on your behalf.
If you are a member jointly with someone else, only
the ‗primary joint member‘ needs to sign. You are
the primary joint member if the notice of Special
General Meeting sent with this Appointment of Proxy
was addressed to you.
Your Signature (or Attorney‘s Signature)
Members that are Body Corporates
A body corporate member must sign this Appointment of Proxy form in accordance with its Constitution.
Signature of Director*/Sole Director &
Secretary*/Authorised Person*
Signature of Director*/Secretary*/Authorised Person*
* Delete whichever is not applicable
D
HOW DO YOU WANT YOUR PROXY TO VOTE?
You can direct your proxy how to vote at the Special General Meeting. Your proxy can decide how to vote
himself or herself on any business at the Special General Meeting in relation to which you do not provide any
direction how to vote.
Direction to Chair for Item 2. If you have appointed the Chair as proxy (or the Chair becomes your proxy by default) and you have not
marked any of the boxes below next to Item 2, then you hereby direct the Chair to vote in favour of the resolution on that item, even
though Item 2 is connected directly or indirectly with the remuneration of a member of the key management personnel.
Tick the appropriate box if you want to direct your proxy how to vote:
FOR
Item 1:
To approve the proposed transfer of business by
Manly Warringah Credit Union limited to Sutherland
Credit Union Limited including amendments to the
Constitution (relating to board size and common bond)
and change of company name
Item 2.
To approve payment of $15,209 to Bob Manning
on the last business day before the transfer of
business
Item 3.
To amend the Constitution to all for the board
appointment of up to 3 additional directors in the event of
a transfer of business.
AGAINST
ABSTAIN
If you mark the ABSTAIN box, you are directing your proxy not to vote at the Special General Meeting and
your vote will not be counted when calculating whether the required majority of members has passed the
resolution.
E
WHAT DO I DO NEXT?
Once you have completed this Appointment of Proxy you may give it to Sutherland Credit Union Limited by:
hand-delivering it to our registered office at Level 2, 670 Princes Highway, Sutherland NSW;
posting it to Sutherland Credit Union Limited at PO Box 535, Sutherland NSW 1499; or
faxing it to Sutherland Credit Union Limited on fax number 02 9521 4754. If you will be faxing this
Appointment of Proxy form back to us, please fax both pages and complete the following details (to
assist us if the pages of your fax become separated):
Membership in the Name(s) of:
Membership Number
If your attorney signed this Appointment of Proxy, you must also send us the original or a certified copy of the
Power of Attorney. If an authorised person signed this Appointment of Proxy for a body corporate member,
the original or a certified copy of the authorisation must also be sent to us.
IMPORTANT
For your appointment to be valid this Appointment of Proxy must reach Sutherland Credit Union
Limited by no later than 48 hours before the start of the Special General Meeting.
INFORMATION DOCUMENT
PROPOSED TR ANS FER OF BUSI NESS
By
M ANLY W ARRING AH CREDI T UNION LIMITED
To
SUTHERL AND CREDI T UNION LIMITED
Manly Warringah Credit Union Limited ABN 81 087 650 299 (Manly Warringah) and Sutherland Credit
Union Limited ABN 89 087 650 708 (Sutherland) propose to merge by transferring all of Manly
Warringah‘s business to Sutherland.
The merger will proceed if members of Manly Warringah and Sutherland approve the merger proposal at
their respective Special General Meetings and the Australian Prudential Regulation Authority (APRA)
provides the necessary regulatory approvals.
Please note that the merger proposal is a total package. Members can only choose to approve or not
approve the merger proposal in its entirety as described in this Information Document. The only
exceptions to this are the payments to the non-transferring Manly Warringah and Sutherland directors
which can only be paid if Manly Warringah and Sutherland members approve them by separate
resolutions at their respective Special General Meetings.
Your Board prepared this Information Document in order to provide members with information about the
merger proposal. The Boards of both credit unions unanimously endorse the contents of this Information
Document and are not aware of any other information that is material to members' decision whether or
not to approve the merger.
Attached are 5 Schedules, which form part of this Information Document:
Schedule 1 highlights the products and services that Sutherland and Manly Warringah currently offer
Schedule 2 compares loans, savings and term deposit products for both credit unions.
Schedule 3 sets out the fees and charges that both credit unions currently charge members.
Schedule 4 includes assurances from the Board of Manly Warringah.
Schedule 5 describes differences between the rights and liabilities attaching to member shares in
Sutherland and Manly Warringah
Please read this Information Document and the attachments carefully before deciding whether to
attend the Special General Meeting and vote. If you have any queries, please call one of the
member information lines below.
Sutherland Credit Union Limited
Manly Warringah Credit Union Limited
Member Information Line
Member Information Line
Telephone:
1300 784 388
Telephone:
1300 13 1964
E-mail:
Memberlink@Sutherlandcu.com.au
E-mail:
info@nbcu.com.au
DISCLAIMER
The Australian Prudential Regulation Authority (APRA) has approved this Information Document pursuant to Rule
9 of the Transfer Rules No 1 of 2004 for purposes of the Financial Sector (Business Transfer and Group
Manly W arringah Credit Union Limited TO Sutherland Credit Union Limited
TRANSFER OF BUSINESS – FIRST LETTER
P AGE 6 OF 41
Restructure) Act 1999 (Cth). In deciding whether to approve this Information Document, APRA has consulted with
the Australian Securities and Investments Commission (ASIC). Both APRA and ASIC accept no responsibility for
the accuracy or otherwise of any matters contained in this Information Document or attached to this Information
Document.
P AGE 7 OF 41
THE MERGER
The merger will involve a total transfer of business by Manly Warringah to Sutherland under the
Financial Sector (Business Transfer and Group Restructure) Act 1999 (Cth). On the merger date:
all of the assets and liabilities of Manly Warringah become assets and liabilities of Sutherland;
the duties, obligations, immunities, rights and privileges applying to Manly Warringah apply to
Sutherland;
each member of Manly Warringah will become a member of Sutherland and will be issued with a $10
member share in Sutherland unless the member is already a member of Sutherland in which case
Sutherland will refund the amount paid up on the Manly Warringah member share;
each member share in Manly Warringah will be cancelled, other than the member shares of the
directors of Manly Warringah;
the board of Sutherland will comprise of 9 directors: 5 directors from Sutherland and 4 directors from
Manly Warringah;
the company name of Sutherland will change to Strategic Partnerships Group Limited;
the constitution of Sutherland will be amended as described on page 24 under ―Changes to the
Constitution of Sutherland.
Sutherland is not making a payment to Manly Warringah or its members for the transfer of business.
If the members of Manly Warringah and Sutherland approve the transfer proposal, and subject to APRA
granting the necessary regulatory approvals, the merger between Manly Warringah and Sutherland will
take effect on 1/3/13 or such later date approved by APRA.
Further information about the effect of the merger on the rights and liabilities of Manly Warringah‘s
members is set out under ―Effect of the Merger On the Rights and Liabilities of Manly Warringah
Members‖.
DEREGISTRATION OF MANLY WARRINGAH AFTER MERGER
After the merger, Manly Warringah will be an empty shell company without any assets and with its
directors being its only members. The Board of Manly Warringah gives its assurance that it will
deregister the Manly Warringah company, that it will ensure that all Manly Warringah funds are
transferred to Sutherland, and that it will prepare, sign-off and lodge financial statements for the Manly
Warringah company, to the extent required by law (see Schedule 4).
!
For the reasons set out in this Information Document, Sutherland and Manly
Warringah credit union’s Boards both unanimously endorse the merger proposal
and recommends that you vote FOR it.
Each director of both Sutherland and Manly Warringah credit union intends to vote
FOR the merger proposal.
BACKGROUND
MANLY WARRINGAH CREDIT UNION LIMITED
Manly Warringah Credit Union commenced trading as McKellar County Credit Union in 1965 with 179
members, $15,000 in assets and one branch. Over the years 10 credit unions merged into what today
trades as Northern Beaches Credit Union.
PAGE 8 OF 41
Manly Warringah Credit Union, trading as Northern Beaches Credit union, as at 30/6/12 has 10,148
members, 28 staff, $118 million in assets and 4 Branches located at Manly, Warringah Mall, Dee Why
and Newport.
Manly Warringah Credit Union is in the unique position of being the only credit union in its catchment
area of Sydney‘s Northern Beaches, therefore offering a genuine viable alternative for local people to the
major banks.
SUTHERLAND CREDIT UNION LIMITED
Originally established in 1969 as the Australian Atomic Energy Commission (AAEC) Employees Credit
Union Ltd, a change was undertaken in 1982 to a community based financial institution under the name
of Shire of Sutherland Credit Union Ltd. In 1994, the name was amended to Sutherland Credit Union Ltd
and has continued since then providing financial services to the broader Sutherland shire community.
The Credit Union‘s current distribution network comprises a head office at Sutherland and four branches,
located in Sutherland, Engadine, Miranda and Cronulla, together with a suite of remote access facilities
incorporating ATM access, EFTPOS, internet banking and telephone banking.
As at the proposed merger date, it is anticipated that Sutherland will have over $200 million in assets,
10,300 members, and 36 employees.
WHAT ARE THE REASONS FOR THE MERGER?
Cost Efficiency
The retail financial services industry continues to consolidate due to intense price competition and
increasing regulatory requirements. This competitive market environment has placed pressure on
interest rate margins which makes it difficult to maintain earnings through reasonable fee charges and
cost control. These trends are expected to continue and require a different business approach to
meeting future challenges.
While both Credit Unions are niche players supporting and providing banking services to our local
communities, we compete for the same savings and loans as the major banks in the same regulatory
environment. Where large banks generally operate on a cost to income ratio under 60%, Credit Unions
typically are considerably higher, and while we don‘t pay dividends to shareholders, there remains the
pressure to operate more efficiently than is currently the case.
The Sutherland and Manly Warringah Boards commissioned detailed financial modelling of what a
combined Credit Union would look like. The modelling confirmed that in comparison to the two individual
Credit Union future projections, a combined Credit Union is expected to achieve considerably better
results from a cost-efficiency perspective. For example, in year 3 the cost to income ratio for the merged
entity is projected to be around 75% in comparison to current year individual scenarios of >85% and
>90% for Sutherland and Manly Warringah respectively.
A reduction of approximately $1m in operating costs per year would be achieved by the end of the
second year of the merged entity. The majority of these savings would be from running one core banking
system instead of two, and one executive management & administrative team. There would be no
reduction in branches or service staff.
This significant improvement in operating efficiency would mean a financial institution better equipped to
deal with and respond to competitive pressures in terms of pricing, resources and services.
If both Credit Unions were to continue as individual entities (without a merger), the opportunities for
either to achieve significant cost reductions in its own right without damaging service capability are
regarded as minimal.
Regulation and Compliance
P AGE 9 OF 41
Similarly, compliance with prudential standards and other regulatory changes has required significant
investment in technology, stronger corporate governance, and enhanced management expertise. Proper
compliance response demands a significant amount of Board and management time and a
commensurate allocation of resources. Both Boards believe that the combined larger credit union will
have greater potential to compete for more members' business whilst meeting its prudential
responsibilities.
The Boards of both Sutherland and Manly Warringah are striving to ensure that members have access to
a credit union that not only meets their current and future financial needs in this highly competitive
environment, but is a viable and successful banking and financial services alternative. The proposed
merger will retain the essential credit union characteristics of a focus on members, and a structure based
on the principles of mutuality.
Continuing our brands
A fundamental consideration for both Boards was the desire to continue offering financial services under
the existing brands. Specifically for this reason, a new company name, ‗Strategic Partnerships Group
Ltd‘ is proposed, which will trade as ‗Sutherland Credit Union‘ and ‗Northern Beaches Credit Union.‘ This
structure also allows for the future addition of other Credit Unions wishing to merge but continue with its
own brand.
In terms of structure, Strategic Partnerships Group Limited will become the sole legal entity after
transfer, with one AGM, one set of accounts, and one board of directors. The deposit guarantee
(currently $250,000) will apply only once across deposits held in either Sutherland or Manly Warringah
accounts or both.
Both Credit Unions have a long and proud association with their respective geographic catchment areas,
the Sutherland Shire and the Northern Beaches peninsular. Each Credit Union identifies strongly with its
member base and is actively involved in providing banking services and support for the local community.
Sutherland and Manly Warringah have both provided long term sponsorship support for local clubs,
groups and causes.
Both Credit Unions have a high level of engagement with local business groups and social enterprises.
As community based financial institutions, active support takes the form of fund-raising, financial
assistance, and promotion of local hospitals, volunteer surf life saving clubs, and other charitable
causes. In 2012, Sutherland invested in an ‗Artist in Residence‘ program, providing children in 20 local
schools with the opportunity to be taught by a professional artist, at no cost to the school or parents. This
annual community project will be extended to the northern beaches area if the merger proceeds.
Further, both Credit Unions offer the same innovative local business support program (Mutual Advantage
Program at Manly Warringah and Mutual Value Program at Sutherland). These programs provide unique
support and incentive for local businesses that do their banking with the Credit Union, and are an
important point of difference from other financial institutions.
Accordingly, given the investment in local banking and community support, a key requirement for both
Boards was the continuation of brands, branch networks and local involvement.
Under this proposed merger model, both Credit Unions would continue to operate in their own market
under their own branding. Branches, cards, statements, stationery, Internet Banking, etc would retain
current branding. The core banking system used by Sutherland offers a solution that allows both Credit
Unions to continue offering services under the separate brands. Additionally and importantly, given the
geographic separation, there is no duplication of branches and therefore will be no branch closures as a
result of the merger.
The Memorandum of Understanding negotiated by the two Boards specifically includes a minimum 5
year requirement for retention of the brands and branches.
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Both Boards believe that this solution is more desirable than the more typical merger model for Credit
Unions where the smaller Credit Union is generally absorbed and the brand discontinued after a set
period of time. The retention of both brands and branch networks, plus the expanded range of products
and services available to all members is anticipated to result in retention of existing business as well as
greater potential for expansion.
Why Sutherland and Manly Warringah?
Synergy. The two Credit Unions are very similar in structure, culture and membership profile.
Each has 4 branches, a strong service ethos, and approximately 10,000 members from a similar higher
value socio-economic background including a strong small business segment.
Manly Warringah and Sutherland have a positive recent history of cooperation and sharing resources
with the introduction of the Mutual Value and Mutual Advantage Programs a good example. The
similarities in size and member demographics allow for a straight forward planning and implementation
of marketing & business development activities.
Minimal duplication. There is no overlapping of branches, meaning minimal disruption to staff and
members, and no change to existing branch networks.
Matching Objectives. A desire to continue the Credit Union name and service, but on a bigger scale
from a stronger financial base.
Future Growth Opportunities
Acquisition
Both Boards believe that the branding model for this merger will prove attractive to other credit unions in
a similar position looking for the twin objectives of scale efficiency and brand retention in coming years.
The greater resources of a merged entity to generate growth within the Northern Beaches and
Sutherland Shire catchment areas can be complemented by the potential addition of like-minded credit
unions that see our model as a preferable alternative to being absorbed into the brand of a much larger
credit union. Credit unions in general have a strong affinity with their local community or employment
group, and a desire to see that relationship continue. This model offers brand continuity and with it, the
retention of community and customer relationships.
Natural Growth
Both Sutherland and Manly Warringah Credit Union have demonstrated a capability to grow their asset
base over recent years from their respective catchment areas. Sustainable growth requires a strong and
stable capital base.
The financial modelling indicates a greater capacity for the merged entity to generate and sustain capital
through retained earnings than either Sutherland or Manly Warringah individually, under a variety of CPI
(cost) and growth scenarios. This is due to improved scale and cost effectiveness of operations once
merger savings have been achieved.
Capital Adequacy
Ratio
Sutherland
(as at June 2012)
Manly Warringah
(as at June 2012)
Merged Entity
Projections*: Year 2
Merged Entity
Projections*: Year 3
15.69%
15.30%
15.77%
16.42%
* Assumes CPI of 3%pa and growth of 3% pa. Note, Merged Entity profit and Capital projections are higher for each cost and
growth scenario modelled beyond Year 2.
P AGE 11 OF 41
With relatively low penetration in the Sutherland Shire and Northern Beaches catchment areas, both
Boards see considerable potential for growth within those communities. A better resourced merged entity
will be better placed to take advantage of that potential.
Overall
In considering suitable merger partners, both Sutherland and Manly Warringah Boards considered the
benefit to members as the driver of any proposed partnership. As relatively smaller financial institutions,
Sutherland and Manly Warringah have been exposed to market and regulatory challenges and
associated cost pressures. These same market challenges have caused an escalation in voluntary
merger activity throughout the credit union sector, as credit unions have sought to maintain their
competitiveness by harnessing the benefits of enhanced scale and operational efficiency. The
consequence of these changes is that credit unions have become stronger and more viable financial
institutions.
In arriving at the decision to recommend this merger to members, the Sutherland Board reviewed the
potential of a number of other credit unions and concluded Manly Warringah to be the best strategic fit at
this point in time, for the reasons outlined in this document. The Board of Manly Warringah assessed the
merits of other partnership models in detail over the past 12 months, and concluded that the financial
viability was too great a risk to pursue.
The option of voluntary transfer of assets to another credit union was not viewed as appropriate,
necessary, or in the best interests of members in comparison to this merger proposition, and was
therefore not considered.
Accordingly, both Boards formed the view that this merger is the best option for members in terms of
longer term stability and continuation of the individual brands.
Both Sutherland and Manly Warringah Boards have been closely monitoring the market environment and
regulatory trends, and expect them to intensify in the years ahead. Consequently, both Boards have
recognised an opportunity to pursue this voluntary merger in order to achieve greater scale economies
and to acquire the financial capacity to respond more easily to increasing competition.
The merger will deliver tangible and immediate benefits to both Sutherland and Manly Warringah‘s
members in terms of access to a broader product range than is currently the case. Following the merger,
it is anticipated that the merged entity will commence with assets of over $308 million, 20,000 members
and around 57 employees. Within 2 years, the cost base is expected to be over $1m lower, delivering a
substantial improvement in efficiency.
Both Sutherland and Manly Warringah Boards firmly believe this merger is in the best interests of
Members as it is expected to achieve an outcome that delivers a financially stronger financial institution
more capable of competing in the current market, while importantly retaining both brands and distribution
networks.
ADVANTAGES AND DISADVANTAGES OF THE MERGER FOR MEMBERS
The Boards of Sutherland and Manly Warringah Credit unions believe that the merger proposal has the
following advantages for members:
General
The merged credit union will have a greater capacity to meet its ongoing prudential and
regulatory requirements as a viable banking alternative for members.
The merged credit union will remain a mutual and retain the mutuality principle of one member
one vote. This allows all members an equal opportunity to contribute to the governance of the
credit union.
The merged entity will use its larger size to compete for more members' business.
P AGE 12 OF 41
Once the two credit unions have been fully integrated, the merger will release operational cost
savings that will be used to enhance the range and competitiveness of member products and
services. A reduction of an estimated $1m in annual operational costs is expected to deliver a
more efficient business cost to income ratio of around 75% compared to the current 85%+ and
90%+ for Sutherland and Manly Warringah respectively.
The merged credit union will retain the brand and branch networks of both Sutherland and Manly
Warringah for a minimum of 5 years with the objective of this continuing. The merger model is
based on better resources to develop existing brands.
The new Board will comprise five directors nominated by the Board of Sutherland and four
directors nominated by the Board of Manly Warringah to ensure that both original entities
continue to have input into the strategy of the combined entity and a role in ensuring sound
governance of the combined entity. The appointment of responsible persons is subject to
Sutherland‘s Fit and Proper policy.
Sutherland and Manly Warringah currently have a wide range of retail financial services and the
combined strength will allow the merged entity to provide a broader product range at competitive
prices with fair fees and charges.
The staff members of the merged organisation may have improved career opportunities in the
larger structure.
The merger will reduce concentration risk for both parties. The merged entity will therefore have
broader market coverage.
Members from both Sutherland and Manly Warringah will have access to the 8 branches and all
ATM‘s of the merged entity.
By specific prudential regulation, Manly Warringah is limited in its aggregate provision of
average-sized mortgage secured loans. The merged organisation will not be so limited.
Specific
Sutherland Members will gain access to the following existing products that Manly Warringah
members currently have access to:
o Bonus Saver facility
o Introductory rate home loan.
o Merchant facilities for those Members operating a business.
o Travelex facilities.
o Branches at Dee Why, Newport, Warringah Mall and Manly
o Special offers from more Sydney businesses through the Mutual Value Program (MVP).
Plus exposure to more potential customers for participating businesses.
Manly Warringah members will gain access to the following existing products that Sutherland
members currently have access to:
o
o
o
o
o
o
eSaver facility,
1, 2 and 5 year fixed rate options for property loans.
Offset facility on Investment Loans
Superannuation Access facility
Branches at Sutherland, Engadine, Miranda and Cronulla.
Special offers from more Sydney businesses through the Mutual Advantage Program
(MAP). Plus exposure to more potential customers for participating businesses.
P AGE 13 OF 41
A disadvantage of the merger may be that some products and services, including fees, charges, interest
rates and features may change as they are aligned over time.
The Boards of Sutherland and Manly Warringah believe that members of both credit unions will benefit
from access to the combined set of current facilities. While the interest rates applicable to current loan
and term deposit facilities will be maintained for the duration of their existing term, new facilities opened
post-merger will be at be at interest rates available at the time, which may or may not be better.
At the time of writing, there are some differences which may be considered less favourable, and these
items include:
Sutherland offers a lower interest rate on Cash Management Accounts for balances over $5,000.
However Sutherland offers an eSaver facility (not currently offered by Manly Warringah) offering
a higher rate of interest on the full balance.
Sutherland offers a lower interest rate (by 0.05%) on business account balances greater than
$50,000, and interest is credited quarterly instead of monthly. However, for amounts less than
$50,000 Sutherland‘s interest rates are higher.
The interest rate applicable to Sutherlands‘ Basic Loan product is slightly higher than Manly
Warringah‘s equivalent ‗Minimiser‘ product by 0.09%. However the application fee for the
Sutherland product is $255 lower.
The establishment fee for an overdraft secured by residential mortgage is $100 at Sutherland and
at Manly Warringah. However the variable interest rate for the Sutherland facility is lower.
Some credit fees for Sutherland are higher (eg, arrears, credit default notices). However,
Sutherland‘s loan establishment fees for personal loans and mortgages are equal to or lower
than Manly Warringah‘s.
It is noted the merged credit union intends to conduct a full review of fees and charges prior to alignment
upon integrating the two banking systems. This is anticipated to occur within 6 months of the formal
merger approval. No decision on detailed alignment has been taken to date.
For further information please refer to information under ―Products and Services‖ in the Sutherland
Directors‘ Statement below, and to the comparison of Sutherland‘s and Manly Warringah‘s existing
products and services in Schedules 1, 2, and 3 including details of fees, charges and interest rates.
The Sutherland Directors‘ Statement reports that the merged entity intends to provide the full range of
services provided prior to the merger by either credit union, upon integration of the two banking systems.
The intention is to integrate the banking systems by the end of June 2013.
Duplication of some roles will occur in the area of back office administration and this will result in a
reduction of positions. It is anticipated that the reduction will be restricted to around six positions. While
this process will be achieved through voluntary redundancy in the first instance across Sutherland and
Manly Warringah staff in affected areas, the loss of these positions could be considered a disadvantage.
The Boards of Sutherland and Manly Warringah note that these reductions will be considerably less than
would be the case in merging with a much larger credit union or a credit union with duplicated branch
networks, and that redundancy provisions for both credit unions are more generous than prescribed
under the relevant Award.
Manly Warringah will contribute 4 of the 9 Directors upon merger. This could be viewed as a
disadvantage in terms of representation, however it is the unanimous recommendation of the Manly
Warringah Board that the 5:4 split is a positive outcome for members.
The Board has considered the entirety of the merger and believes that the advantages
significantly outweigh the disadvantages for members arising from the merger.
P AGE 14 OF 41
EFFECT OF THE MERGER ON THE RIGHTS AND LIABILITIES OF MANLY
WARRINGAH MEMBERS
After the merger, each member of Manly Warringah (except its directors) will cease to be a member of
Manly Warringah and their $10 member share in Manly Warringah will be cancelled. Each Manly
Warringah member will be issued with a $10 member share in Sutherland and will become a member of
Sutherland, unless the member is already a member of Sutherland in which case Sutherland will refund
the amount paid up on the member‘s Manly Warringah member share.
There are a number of technical differences between the rights and liabilities attaching to member
shares in Manly Warringah and Sutherland. In addition, there are some differences between the
Constitutions of Manly Warringah and Sutherland that may impact on members‘ enjoyment of rights.
These differences are described in Schedule 5.
Two of the differences described in Schedule 5 will not apply to transferring Manly Warringah members
on becoming members of Sutherland, namely:
in the event of a restructure of Sutherland involving a demutualisation only persons who have
been members for at least 1 year can share in any surplus or profits;
only a person who has been a member of Sutherland for at least 1 year can nominate for election
as director.
These rules will not apply to transferring Manly Warringah members because on the merger taking effect
they will be deemed to have met the requirement for 1 year membership of Sutherland for the purpose of
these rules.
Sutherland – Tier 1 Shareholder
Sutherland has on issue 13,000 $100 Tier 1 Shares in addition to its member shares. The only holder of
Tier 1 Shares is CUNA Mutual Life Australia Limited. CUNA Mutual Life Australia Limited also holds a
member share in Sutherland and thus will have the opportunity to vote on the transfer at Sutherland‘s
Special General Meeting.
Tier 1 Shares are investment shares which carry:
• The right to receive dividends in priority to dividends payable to member shareholders.
• No right to vote.
• In a winding up of Sutherland, a right to payment of the issue price of the shares (but only after
payment of the subscription price on member shares), but no right to otherwise share in any surplus.
Sutherland has the ability to issue further Tier 1 shares in the future.
The fact that Sutherland can issue, and has issued, Tier 1 Shares does not affect the rights Manly
Warringah members will have on becoming member shareholders of Sutherland.
Member rights are set out in the Constitutions of each credit union. To obtain a copy of the Constitution
of Manly Warringah please contact the Manly Warringah member information line (02) 1300 13 1964, or
by email info@nbcu.com.au, or for Sutherland‘s Constitution, contact Sutherland on 1300 784 388 or by
email memberlink@sutherlandcu.com.au.
SUTHERLAND DIRECTORS’ STATEMENT
The directors of Sutherland have provided the following statement setting out their intentions in relation
to future management of the business.
P AGE 15 OF 41
FUTURE DIRECTIONS
The business of Sutherland and Manly Warringah will be integrated as soon as practical following the
merger date approved by APRA. Further details about the integration process are provided in the
following sections.
NAMES
The merged credit union‘s company name will be ‗Strategic Partnerships Group Limited‘. Strategic
Partnerships Group Limited intends to use the trading names Northern Beaches Credit Union and
Sutherland Credit Union in relation to the Manly Warringah and Sutherland existing branches and
business for a minimum period of 5 years,
BRANCHES
The administrative headquarters and registered office of Sutherland will remain located at Level 2, 670
Princes Highway Sutherland. Manly Warringah‘s head office at 17-19 Oaks Avenue, Dee Why will
become a regional administrative office of the merged credit union. Following the date of the merger, all
existing Sutherland branches and Manly Warringah branches will continue to operate and provide the
same levels of service to members as they do today.
Members of Sutherland will be able to access Manly Warringah branches and vice-versa.
STAFF
On the merger date, all permanent Manly Warringah staff will become staff members of Sutherland on
employment terms and conditions, including salaries and accrued leave entitlements that are no less
favourable than those that applied to them immediately prior to the merger.
The Chief Executive Officer of Sutherland, David Harll, will step down and receive a payment as per the
terms of his current contract. The Head of Sales and Operations at Sutherland, Shawn Griffiths will
become the Chief Executive Officer of the merged entity. The Chief Executive Officer of Manly
Warringah, David Clulow, will be employed in the merged entity in the role of Deputy Chief Executive
Officer.
Where duplication of back office roles exists, reduction will be achieved by voluntary redundancy in the
first instance. Redundancy packages for Manly Warringah and Sutherland non-contract staff will be
offered on terms exceeding the statutory minimum specified by the National Employment Standards.
PRODUCTS AND SERVICES
Immediately after the merger, all products currently held by members of either credit union will continue
under their existing terms and conditions including interest rates, fees and charges. There will be no
immediate change to BSB, account numbers or banking authorities.
Interest rates on term deposits and fixed rate loans held at the date of the merger will remain fixed for
the remainder of the term.
After the merger Sutherland will review current interest rates, fees and charges in order to ensure that
pricing is fair, profitable and sustainable. Sutherland will also review all loan, savings and investment
products with the intention of developing a range of products that meets members‘ needs. Sutherland
intends to integrate the Sutherland and Manly Warringah products and services by the end of June 2013.
Members will be informed of any changes to their products in accordance with the existing terms and
conditions of the products.
Upon integration of the banking systems, Sutherland intends to continue to provide the full range of
services provided by either credit union prior to the merger. Schedules 1, 2 and 3 list and compare the
products and services that Sutherland and Manly Warringah currently provide, including details of fees,
charges and interest rates.
P AGE 16 OF 41
The merged credit union will continue to provide Sutherland‘s Mutual Value Program and Manly
Warringah‘s Mutual Advantage Program.
WHAT IF THE MERGER DOES NOT PROCEED?
For reasons explained elsewhere in this Information Document, your Board believes the proposed
merger will provide benefits to members.
If the merger proposal does not proceed, the operations of Manly Warringah and Sutherland will
continue at least in the short term, on the basis that they do today. However, neither Manly Warringah
nor Sutherland would have the same capacity to deliver the enhanced member services that the merged
credit union would have and the credit unions would continue to absorb increasing regulatory and
compliance burdens individually.
Further, the Manly Warringah and Sutherland Boards expect the various competitive and market
pressures explained elsewhere in this Information Document will intensify in the years ahead, and may
require both Credit Unions to identify an alternative merger partner in the medium term. There is no
guarantee that an alternative future merger would be on the same terms as proposed here.
FINANCIAL POSITION OF THE CREDIT UNIONS
The following table summarises the financial position of Sutherland and Manly Warringah and is based
on audited financial reports for each credit union as at 30th June 2012 and as at 30th June 2011. If you
require further financial information about either credit union please call or email the credit union.
Contact details are set out on the front page of this Information Document.
P AGE 17 OF 41
STATEMENT OF FINANCIAL
Sutherland Credit Union
Northern Beaches Credit Union
POSITON
Audited
Audited
Audited
Audited
30-Jun-12
30-Jun-11
30-Jun-12
30-Jun-11
ASSETS
Cash assets
Receivables due from other financial
institutions
Loans and advances
8,886,190
9,746,980
9,002,584
9,038,151
34,812,816
29,984,425
18,945,429
12,958,600
84,008,942
154,515,648
157,003,583
86,549,099
Other investments
694,043
716,076
315,604
315,604
Property
173,616
165,726
2,725,571
2,828,307
Other assets
TOTAL ASSETS
1,479,022
2,343,429
927,122
1,182,193
200,561,335
199,960,219
118,465,409
110,331,797
LIABILITIES
Overdrafts and borrowings
261,542
-
Deposits
180,627,474
180,299,430
106,516,708
98,731,039
Payables
4,951,314
5,178,976
2,035,116
1,717,901
Provisions
TOTAL LIABILITIES
NET ASSETS
-
392,816
366,157
174,156
168,919
186,233,146
185,844,563
108,725,980
100,617,859
14,328,189
14,115,656
9,739,429
9,713,938
12,526,875
12,334,966
8,475,320
8,454,459
1,126,580
1,126,580
-
-
674,734
654,110
1,264,109
1,259,479
14,328,189
14,115,656
9,739,429
9,713,938
MEMBERS' EQUITY
Retained earnings (General Reserve)
Share Capital Preference Shares
Other reserves
TOTAL MEMBERS' EQUITY
COMPARATIVE STATEMENTS
Northern Beaches Credit Union
OF COMPREHENSIVE INCOME
Audited
Audited
Audited
Audited
30-Jun-12
30-Jun-11
30-Jun-12
30-Jun-11
Interest income
13,284,272
13,233,194
7,445,362
7,400,714
Income expense
7,928,585
7,635,532
3,751,251
3,282,828
Net interest income
5,355,688
5,597,662
3,694,111
4,117,886
Fee, commission & other income
1,095,797
1,642,646
1,102,979
1,160,536
6,451,485
7,240,308
4,797,090
5,278,422
Impairment losses
39,285
8,336
88,487
207,553
Fee & commission expenses
94,979
101,465
282,872
292,084
General administration
4,823,265
4,310,178
3,161,966
3,274,088
Other operating expenses
1,185,845
1,254,416
1,229,959
1,224,166
308,111
1,565,913
33,806
280,531
Profit before income tax
Income tax expense
25,454
452,794
8,315
58,856
Total income for the year
282,657
1,113,119
25,491
221,675
Total comprehensive income for the
year
282,657
1,113,119
25,491
221,675
There has been no material change to the financial position of either credit union since 30th June 2012
and members will be informed of any material change between the date of this document and the date of
the members resolutions at the Special General Meeting.
P AGE 18 OF 41
THIRD PARTY ADVICE
MANLY WARRINGAH
Manly Warringah used the services of Grant Thornton auditor Max Perry and corporate services
consultant, David Ingham to perform a due diligence review on Sutherland. Mr Perry performed a review
of strategy, credit risk and financial risk, Mr Ingham reviewed corporate risk, secretarial risk and
operations. The results of the due diligence indicated that there were no matters that would adversely
affect the members of Manly Warringah on the transfer of business to Sutherland.
SUTHERLAND
Sutherland used Grant Thornton auditor Neville Sinclair to conduct a due diligence review of Manly
Warringah. Sutherland engaged Paul Venn (lending consultant) to review a sample of Manly Warringah‘s
loan contracts for compliance. Sutherland also engaged Daniels Bengtsson Legal & Consulting to review
various legal and compliance aspects of Manly Warringah. The purpose of the reviews was to satisfy the
Board of Sutherland that none of the areas under review would adversely affect the interests of
depositing members.The due diligence exercises undertaken on behalf of Sutherland found that none of
the findings were material to the interests of Sutherland members accepting a transfer of business from
Manly Warringah.
There was one matter identified by Daniels Bengtsson Legal and Consulting which your Board sought
clarification on from them together with asking management to review the potential liability to Sutherland.
Daniels Bengtsson Legal and Consulting stated that in their opinion the matter was not material. A
second independent legal opinion on the matter was obtained from Mark Swivel Legal which also
concluded there would not appear to be any potential liability arising. Notwithstanding these opinions,
your Board resolved to set aside sufficient reserves to cover any such potential liability, which is in
keeping with best Risk Management practice.
The due diligence reports and subsequent assessment and clarification concluded that there were no
issues reviewed that would be adversely material to the interests of member depositors on a transfer of
business.
CURRENT DIRECTORS OF SUTHERLAND AND MANLY WARRINGAH
Daryl Chipperfield
Sutherland
David Milne
Sutherland
Mitchell Reece
Sutherland
Helen Hartley
Sutherland
Peter Geraghty
Sutherland
Bob Manning
Sutherland
Gary Thomson
Manly Warringah
Raymond Brown
Manly Warringah
Matthew Haes
Manly Warringah
Adam Walkaden
Manly Warringah
Rick Chown
Manly Warringah
Brian Green
Manly Warringah
Susan Griffin
Manly Warringah
P AGE 19 OF 41
THE PROPOSED MERGED CREDIT UNION BOARD
If the merger is approved, Strategic Partnerships Group Board will consist of 9 directors, comprised of 5
current Sutherland directors and 4 current Manly Warringah directors, as set out in the table below.
DIRECTORS OF STRATEGIC PARTNERSHIPS GROUP LIMITED AFTER THE MERGER
Director
Current Credit Union
Term Ends
Daryl Chipperfield
Sutherland
2014 AGM
David Milne
Sutherland
2013 AGM
Mitchell Reece
Sutherland
2013 AGM
Helen Hartley
Sutherland
2015 AGM
Peter Geraghty
Sutherland
2015 AGM
Gary Thomson
Manly Warringah
2014 AGM
Raymond Brown
Manly Warringah
2013 AGM
Matthew Haes
Manly Warringah
2015 AGM
Adam Walkaden
Manly Warringah
2014 AGM
The qualifications and experience of the 9 directors of the proposed new Board are set out in the table
below.
Director
Daryl Chipperfield
David Milne
Qualifications and Experience
Daryl Chipperfield has been a director of Sutherland for 5 years and is currently the
Chairman of the Board of Directors, previously Chairman Audit & Risk Committee and
member of the Nominations and Remuneration committees. Daryl has been involved
in the financial sector covering building societies and credit unions, holding senior
management roles, and for the past 20 years has operated a successful accounting,
taxation and consulting business. Daryl is a Certified Practising Accountant (FCPA)
and is the current Chairman of CPA Australia‘s Disciplinary Tribunal. In 2007 he was
awarded by CPA Australia, the President‘s Award for his contribution to the NSW
Division as the convenor of the Menai Accountants Discussion Group. Additionally
Daryl is a Justice of the Peace and a member of the Australian Mutuals Institute Ltd.
David Milne has been a Director of Sutherland since 1999, and is the current Deputy
Chair. David has been a practicing lawyer since 1976 specialising in banking and
litigation, and has performed legal work for a number of Credit Unions since 1982.
David is a member of the Chairman‘s Committee and Audit and Risk Committee.
David‘s qualifications include LLB, FAMI and Notary Public.
P AGE 20 OF 41
Mitchell Reece
Helen Hartley
Peter Geraghty
Gary Thomson
Raymond Brown
Matthew Haes
Mitchell Reece has been a director of Sutherland for 9 years. She has previously
been a member of both the Audit & Risk and Remuneration Committees. Mitchell
trained as a teacher and has taught business and legal subjects at a number of
Sydney TAFEs as well as delivering courses at the Law Society of New South Wales.
She has been a solicitor for 20 years and is the principal of her law practice at Jannali
where she has been located since 2001.
Helen Hartley has a Bachelor of Arts degree and Master of Letters degree from the
University of New England in NSW. She has been employed in a variety of senior
management roles in the Insurance industry, including Lenders Mortgage Insurance,
Consumer Credit Insurance and General Insurance. Currently she is employed by the
BT Financial Group in their Life Insurance division working on a number of Life risk
and internal Superannuation projects. She is an Associate of the Mortgage Industry
Association of Australia and has been a member of the Board of Sutherland since
2010. Helen is the current Chair of the Audit and Risk Committee.
Peter Geraghty has been a director of Sutherland for 2 years and is currently a
member of the Audit and Risk Committee. Peter‘s background is in Sales & Marketing
and Business Management, he is currently Managing Director of Sanders Property
Agents, a Real Estate Agency in the Sutherland Shire. Sanders Property Agents was
established in 1957 and currently employs 21 staff. Peter is a Licensed Real Estate
Agent, he is currently studying the Diploma in Business Management and is a member
of the Real Estate Institute of New South Wales.
Gary Thomson has been a Director of Manly Warringah for 6 years, and currently
holds the position of Chairman of the Board. He is a member of the Corporate
Governance Committee and will take up the position of Deputy Chair in the proposed
merged entity. Gary is a currently Deputy General Manager at a Local Government
Organisation with 10 years experience in the areas of risk and planning. He holds a
Graduate Diploma in Local Government Management and is a member of the
Australasian Mutuals Institute.
Gary has been a member of Manly Warringah since 1980.
Raymond Brown has been a Director of Manly Warringah since 1988 and currently a
member of the Governance Committee. During his time on the Board he has been the
Chairman for in excess of 10 years and has represented as Chair/member on all of the
CU‘s committees. He has had a working career in Local Government (45yrs approx.)
in the Accounting/ Financial Control areas as well as Human Resources – currently
working for Manly Council. He has also lectured at TAFE (supervision/management)
during that time. Raymond is a Member of the Australasian Mutuals Institute and a
Justice of the Peace. He holds qualifications in Human Resources and has undertaken
and presented numerous training programs. He comes with a wealth of knowledge
regarding the industry.
Matt Haes has been a director of Manly Warringah for 6 months and is also a member
of the Audit and Risk committee. Matt's background is in financial management and
governance of financial service organisations including public companies and not for
profit entities. He was Head of Finance and Company Secretary for Centric Wealth
Ltd, one of Australia's leading independent wealth management businesses, for in
excess of 8 years. He has most recently been appointed as CFO of an ASX listed
public company.
Matt has a Bachelor of Economics, is a Chartered Accountant, Chartered Secretary
and is a member of the Australasian Mutuals Institute.
Adam Walkaden
Adam Walkaden has been a Director of Manly Warringah for 5 years and currently
holds the position of Chair of the Corporate Governance Committee. Adam holds a
Bachelor of Arts and Law and has been admitted as a Solicitor by the New South
Wales Supreme Court. Adam is currently employed as a legal officer by the Australian
Manufacturing Workers Union and is a member of the Australasian Mutuals Institute.
P AGE 21 OF 41
The current Directors of Manly Warringah and Sutherland Credit Unions listed below will not be directors
of the merged credit union.
NON-TRANSFERRING DIRECTORS
CURRENT CREDIT UNION
Brian Green
Manly Warringah
Rick Chown
Manly Warringah
Susan Griffin
Manly Warringah
Robert Manning
Sutherland
P AGE 22 OF 41
INTEREST OF OFFICERS AND OTHER STAKEHOLDERS IN THE MERGER
The following directors of either Manly Warringah or Sutherland, who will not become or remain as
directors of Sutherland, will receive payments on the last business day before the merger, as listed
below, subject to members of the relevant credit union approving each payment by separate resolution
at its Special General Meeting.
POSITION
NAME
Non-transferring director
Brian Green
Rick Chown
Susan Griffin
Robert Manning
BENEFIT
$13,827 (including statutory
superannuation) provided he
remains a director of Manly
Warringah until immediately
before the merger.
before the merger.
superannuation) provided she
before the merger.
remains a director of Sutherland
until immediately before the
merger.
Sutherland‘s Chief Executive Officer, David Harll, has agreed to step down on the merger taking effect
and will be entitled to a payment under his employment contract.
Other than as described above or elsewhere in this Information Document:
No Director or Officer of either Manly Warringah or Sutherland has any interest in the proposed
transfer of business;
No Director, Officer, member or depositor of either Manly Warringah or Sutherland will receive any
compensation, consideration, incentive or benefit in relation to the transfer of business;
No Director, Officer, member or depositor of either Manly Warringah or Sutherland has any
agreement that is conditional upon the proposed transfer of business.
Continuing Directors of Manly Warringah will receive a higher level of remuneration than premerger, with the overall Board remuneration shared as determined by the Board, post merger.
P AGE 23 OF 41
CHANGES TO THE CONSTITUTION OF SUTHERLAND
As part of the special resolution put to Sutherland members to approve the merger proposal,
Sutherland‘s Constitution will be amended to:
Increase the maximum number of directors on the board (as determined by the board) from 7 to 9
directors – this allows Sutherland to have a board of 9 directors from the merger date; and
To remove the existing common bond, which limits new members primarily to residents and
businesses in the Sutherland Shire – this allows the merged credit union to accept new members
after the merger from the Northern Beaches and other areas outside of the Sutherland Shire.
Note also that at the Sutherland Special General Meeting members will also be asked to pass another
special resolution to amend the Constitution to allow the board to appoint up to 3 additional directors in
the event of any future transfer of business. This proposed change is separate from this merger, and
Sutherland members may or may not agree to make this amendment.
HOW DO MEMBERS VOTE ON THE MERGER PROPOSAL?
The merger proposal will only be approved if members of Manly Warringah and Sutherland pass special
resolutions approving the proposal. This means that in order to approve the merger proposal, at least
75% of votes by members of Manly Warringah and Sutherland cast on the resolution, at their individual
meetings, will need to be FOR the resolution.
Members can vote:

In person: Please arrive early if you decide to attend the Special General Meeting, as you will
need to register your attendance on arrival.

By proxy: Even if you cannot attend the Special General Meeting, you can vote by completing the
enclosed Appointment of Proxy and sending it back in the reply paid envelope included with this
notice. Voting by proxy is simple and is explained in the Appointment of Proxy form.
Please Note.
One member one vote prevails on a show of hands or a poll (with the possible exception that, on
a poll, members may be able to vote in different capacities).
If you wish to vote by proxy please read the Appointment of Proxy form carefully before completing it. It
is important that you complete the Appointment of Proxy form correctly otherwise your vote may not be
counted.
The Appointment of Proxy Form allows you to appoint the Chair of the Special General Meeting as your
proxy. The Chair must exercise your proxy vote according to your direction. You may appoint other
people as your proxy, however, you should be certain that they will be attending the Special General
Meeting.
Please Note
Direction to the Chair for Item 2. If you have appointed the Chair as proxy (or the Chair becomes your
proxy by default) and you have not marked any of those boxes next to items 2, on the appointment of
proxy form, then you hereby direct the Chair to vote in favour of the resolution on those items, even
though item 2 is connected directly or indirectly with the remuneration of a member of the key
management personnel.
We recommend that you appoint the Chair as your proxy as it reduces the risk that your vote will not be
counted.
P AGE 24 OF 41
WHAT IF I HAVE QUESTIONS ABOUT THE MERGER PROPOSAL?
Manly Warringah will hold an information evening on 1 February 2013 at Dee Why RSL 932 Pittwater rd
Dee Why, NSW at 6pm. This will be a forum for members to raise questions in relation to the proposed
merger. The Chairman of Manly Warringah will act as moderator to facilitate discussion of the proposed
transfer of business.
Sutherland will hold an information evening on 31 January 2013 at Level 2, 670 Princes Highway,
Sutherland NSW at 6pm. This will be a forum for members to raise questions in relation to the proposed
merger. The Chairman of Sutherland will act as moderator to facilitate discussion of the proposed
transfer of business.
Members are also encouraged to raise any questions in relation to the merger before the information
evenings, the contact details are set out on the front page of this Information Document.
P AGE 25 OF 41
Schedule 1 – Comparison of Products and Services
(as at 30th April 2012)
Products and Services
Member Shares
Savings Accounts
Term Deposits
Loan Accounts
Fees and Charges
Statements
One $10 Member Share
Yes — refer to Schedule 2
Yes — refer to Schedule 2.
Yes — refer Schedule 3.
Monthly and Quarterly
Northern Beaches CU
One $10 Member Share
Yes — refer to Schedule 2
Yes — refer to schedule 2.
Yes — refer Schedule 3.
Monthly and Six Monthly
E-Statements
✓
✓
Telephone Banking
✓
✓
Internet banking
✓
✓
Mobile Banking
✓
✓
Cheque Books
✓
✓
Visa Debit Card
✓
✓
Redicard
-
✓
Mastercard Credit Card
✓
✓
BPAY
✓
✓
ATM/EFTPOS
✓
✓
Periodic Payments
✓
✓
Direct Debit and Credits
✓
✓
Quick Debits
✓
-
Counter Cheques
✓
✓
Telegraphic Transfer
✓
✓
International Drafts
-
✓
General Insurance
✓
✓
CTP Insurance
✓
✓
Consumer Credit Insurance
✓
✓
Mortgage Protection Insurance
✓
✓
Travel Insurance
✓
✓
Income Protection insurance
✓
✓
Financial Planning Services
✓
✓
✓
$5,000 per member/day except
for Cronulla branch that does
not have cash withdrawal
facilities
$3,000 per member per day
✓
Car Buying Services
Branch Cash
Internet Banking - external transfer
Secure SMS
ATM & EFT using card & PIN
✓
$1,000 per card per day , with
$500 inclusive EFTPOS limit
per card per day.
$2,000 per member/day
$1,500
-
$1,000 per card per day
P AGE 26 OF 41
Schedule 2 – Comparison of Loans, Savings and Term Products
PERSONAL ACCOUNTS
Transaction Savings Accounts
Account Name
Balance tiers ($)
Interest rates
Access Account / Equity Access / Line of Credit /
Equity line of Credit
$1 – less than
$5000 to less than
$10,000 plus
$5000
$10,000
0.00% p.a.
0.10% p.a.
0.20% p.a.
Interest calculation
Interest credited
$0- $500
Over $500- $50,000
Over $50,000
0.00% p.a.
0.05% p.a.
0.25% p.a.
6 monthly
Daily on entire balance
Quarterly
Northern Beaches CU
Account Name
Interest rates
Transaction Account
Daily on proportion of closing balance
Interest credited
Balance tiers ($)
Northern Beaches CU
Senior Savers Account
Deeming Account
$2,000 to less
than $44,600
3.00%
$0- less than
$2,000
0.25%
$44,600 +
$0-$2,000
4.25%
0.00% p.a.
Quarterly
Over$2,000 $50,000
2.75% p.a.
Over $50,000
3.75% p.a
Quarterly
Special Purpose Account
Account Name
Balance tiers ($)
Interest rates
Interest credited
Northern Beaches CU
Maxisaver
$0-$4,99
0.10%
$5,000$49,999
0.50%
No Equivalent Product
$50,000-$99,999
$100,000 +
1.00%
1.50%
Quarterly
Online Savings Account
Account Name
Balance tiers ($)
Interest rates
Interest Credited
Northern Beaches CU
eSaver
All balances
4.00%
Daily on closing balance
Monthly
P AGE 27 OF 41
Cash Management Accounts
Northern Beaches CU
Cash Management
Cash Management
Account
Name
Balance
tiers ($)
Less
than
$500
$500$4,999
$5000$9999
$10,000$24,999
$25,000 $49,999
$50,000 $99,999
$100,000 $249,999
$250,000+
Nil
0.10%
0.50%
0.75%
1.00%
1.35%
3.10%
3.10%
Interest
rates
Int
calculation
Int credited
Balance
tiers ($)
Interest rates
Interest credited
Over
$100,000 $250,000
$250,000+
Nil
1.25% p.a.
2.00% p.a
2.75% p.a
4.25% p.a
4.50% p.a.
Quarterly
Northern Beaches CU
Super Access
All Balances
3.95%
Daily
Monthly
Northern Beaches CU
Bonus Saver
Balance
tiers ($)
Normal Interest rates
Interest credited
Over
$50,000 –
$100,000
Quarterly
Account Name
over
$25,000 $50,000
Daily - on whole balance
Bonus Interest Rate
$5,000 $25,000
Daily on whole balance
Account Name
Less
than
$5,000
$0- 500
Over $500 $50,000
Over $50,000
0.00 % p.a
0.40%
0.60% p.a.
0.00% p.a.
2.25% p.a.
4.50% pa
Daily on proportion of closing balance at normal interest rate.
Interest paid at Bonus rate if no more than 1 debit on
account per calendar month.
Monthly
P AGE 28 OF 41
Northern Beaches CU
Account Name
Christmas Club
Christmas Club
Balance tiers ($)
$1+
$1+
Interest rates
Interest credited
Early withdrawal fee
2.00% p.a.
1.00 % p.a
Daily balance
Daily Balance
October
October
Access limited to 15 November – 31
January annually
Interest penalty of half current rate
Northern Beaches CU
Account Name
100% Offset
Mortgage Offset
Balance tiers ($)
All balance
All balance
As per current linked loan
As per current linked loan
Interest rates
Interest credited
Eligibility
Daily
Daily
Offset in linked Loan
Offset in linked Loan
Holding of eligible loan type. Minimum
balance $2000 maintained to receive
offset benefit.
Holding of eligible loan type.
Business Accounts
Transaction Savings Accounts
Account Name
Balance tiers ($)
Interest rates
Interest credited
Business Access / Business Equity/ Line of Credit /
Equity line of Credit
$1 – less than
$5000 to less than
$10,000 plus
$5000
$10,000
0.00% p.a.
0.10% p.a.
0.20% p.a.
Northern Beaches CU
Business Account
Less than
$500
0.00% p.a
Over $500 $10,000
0.05% p.a
Over $10,000$50,000
0.05% p.a
Daily - on whole balance
6 monthly
Quarterly
P AGE 29 OF 41
$50,000 +
0.25% p.a
LOAN ACCOUNTS
Home Loan (Variable Rate)
Account Name
Interest Rate (indicative)
Establishment Fees
Simple Switch Variable
6.74%
$200
Valuation and Legal Fees
At cost
Contract Variation Fee
$100.00
Redraw Fee
Discharge Fee
Account Name
Establishment Fees
Northern Beaches CU
No equivalent product
$25.00
200.00 plus costs
Northern Beaches CU
Standard Variable Rate
6.48%
Standard variable
6.74%
$200
$275.00
At cost
At cost
$100.00
$100.00
Redraw Fee
Discharge Fee
Account Name
Establishment Fees
$25.00
$25.00
$200 plus at cost
At costs
Northern Beaches CU
Interest Only
6.48%
Interest Only
6.74%
$200
$275.00
At cost
At cost
$100.00
$100.00
$25.00
$25.00
$200 plus at cost
At costs
Northern Beaches CU
Basic
6.33%
Minimiser
6.24%
Establishment Fees
$495.00
$750.00
At cost
At cost
-
$100.00
Redraw Fee
Discharge Fee
Account Name
Redraw Fee
Discharge Fee
Account Name
Establishment Fees
$25.00
$25.00
$200 plus at cost
At costs
Northern Beaches CU
Home in One
7.09%
$200.00
At cost
$100.00
Redraw Fee
$25.00
Discharge Fee
$200 plus at cost
Northern Beaches CU
Introductory Loan
5.89% for 1 year then to Minimiser rate
Account Name
$750.00
Establishment Fees
At cost
$100.00
Redraw Fee
$25.00
Discharge Fee
At cost
P AGE 30 OF 41
Home Loan (Fixed Rate)
Account Name
Northern Beaches CU
3 Year Fixed Rate
3 Year Fixed Rate
6.05%
5.89%
Establishment Fees
$495.00
$750.00
At cost
At cost
N/A
N/A
N/A
At cost
At cost
Northern Beaches CU
Redraw Fee
Discharge Fee
N/A
Home Loan (Fixed Rate)
Account Name
2, 5 Year Fixed Rate
6.01%, 6.69%
Establishment Fees
$495.00
At cost
Redraw Fee
Discharge Fee
N/A
N/A
At cost
Unsecured Personal Loans
Northern Beaches CU
17.25%
$100
11.20%- 15.20%
$100.00
Contract variation fee
Nil
Nil
Early repayment fee
Nil
Nil
Redraw fee
N/A
Nil
Northern Beaches CU
8.80%-17.25%
9.24%-13.20%
$100.00
$150.00
Nil
Nil
Interest rate
Establishment fee
Secured Personal Loans/Car Loans
Interest rate
Establishment fee
Early repayment fee
Nil
Nil
Redraw fee
N/A
N/A
P AGE 31 OF 41
Overdraft
Secured By Residential Mortgage
Northern Beaches CU
7.09%
$100
8.09%
$50.00
Nil
Nil
Temporary limit increase fee
Nil
Nil
Annual review fee
Yes
$100
Interest rate
Establishment fee
Secured By Assigned Savings
Interest rate
Establishment fee
Northern Beaches CU
12.25%
$100
Nil
No Equivalent product
Nil
Annual review fee
Yes
Unsecured
Northern Beaches CU
17.25%
$100
14.95%
$100.00
Nil
Nil
Nil
Nil
Annual review fee
Yes
Yes
Interest rate
Establishment fee
Fixed Term Deposits - Interest paid at annually or at Maturity
Northern Beaches CU
Term in
Months
$1,000
$4,999
$5,000 $19,999
$20,000$49,999
$50,000 Plus
1
N/A
N/A
N/A
3
N/A
4.65%
6
1.60%
4.70%
$1,000
$4,999
$5000- $49,999
$50,000+
N/A
N/A
N/A
4.00%
4.80%
4.80%
3.60%
4.85%
5.05%
4.85%
4.85%
3.60%
4.85%
4.95%
9
N/A
4.65%
4.80%
4.80%
N/A
N/A
N/A
12
N/A
4.60%
4.75%
4.75%
2.90%
4.75%
4.90%
18
N/A
N/A
N/A
N/A
2.90%
4.65%
4.85%
24
N/A
4.45%
4.00%
4.60%
2.90%
4.55%
4.80%
Fixed Term Deposits - Interest paid at Quarterly
Term in
Months
$10,001
$20,000
Northern Beaches CU
$1,000
$4,999
$5,000- $49,999
$50,000+
6
3.60%
4.85%
4.95%
12
2.90%
4.75%
4.90%
2.90%
4.65%
4.85%
2.90%
4.55%
4.80%
18
$1,000
$10000
$20,000+
24
P AGE 32 OF 41
Fixed Term Deposits - Interest paid monthly
Term in
Months
$5000- $19,999
6
12
$50,000+
n/a
4.35%
4.50%
4.50%
n/a
18
24
$20,000 $49,999
Northern Beaches CU
4.20%
4.35%
4.35%
$1,000
$4,999
$5,000- $49,999
$50,000+
3.60%
4.85%
4.95%
2.90%
4.75%
4.90%
2.90%
4.65%
4.85%
2.90%
4.55%
4.80%
Fixed Term Deposits – MemberPlus – Interest annually or Maturity
Northern
Beaches CU
$50,000 Plus
Term in
Months
$1,000
$4,999
$5,000 $19,999
$20,000-$49,999
3
N/A
4.90%
5.05%
5.05%
6
N/A
4.95%
5.10%
5.10%
9
N/A
4.90%
5.05%
5.05%
12
N/A
4.85%
5.00%
5.00%
24
N/A
4.70%
4.85%
4.85%
No
Equivalent
Product
Fixed Term Deposits – MemberPlus – Interest Fortnightly
Northern
Beaches CU
$50,000 Plus
Term in
Months
$1,000
$4,999
$5,000 $19,999
$20,000-$49,999
3
N/A
4.65%
4.80%
4.80%
6
N/A
4.70%
4.85%
4.85%
12
N/A
4.60%
4.75%
4.75%
24
N/A
4.45%
4.60%
4.60%
No
Equivalent
Product
P AGE 33 OF 41
Schedule 3 – Comparison of Fees and Charges
Transaction Fees
Monthly Account Fee (per account)
Branch Withdrawals – Cash
Branch Withdrawals – Cheque
Branch Deposits
NAB Deposits
BPAY Transactions
Internet Banking
Direct Debits
Direct Credits
Transfer Between Credit Union Accounts
Over the phone/counter transactions (operator assisted)
Visa retail and merchant purchases (signature)
Visa Debit Card Transactions, Credit Button
ATM - Balance Enquiries
ATM - Withdrawal - RediATMs / NAB ATMs
ATM - Withdrawal - Other Bank
EFTPOS
Personal Cheques
ATM - Declined transactions
Periodical Payment By Cheque
Periodical Payment By EFT
Quickdebit
Sutherland
Credit Union
$3.00 with
balances less
than $1000.00
$3.00
$3.00
Nil
Nil
Nil
Nil
Nil
Nil
Nil
$3.00
Nil
Nil
Nil
$1.25
Fee charged by
ATM owner
$1.25
$2.00
Nil
Nil
Nil
Nil
Northern
Beaches CU
Nil
$2.00
$2.00
Nil
Nil
Nil
Nil
$0.85
Nil
Nil
$2.00
$0.35
Nil
Nil
$1.00
$0.50 + Fee
charged by ATM
owner
$0.85
$0.75
$0.50
$7.00
Nil
Nil
P AGE 34 OF 41
Transaction Fee rebate
MemberPlus and Junior members receive 5
free counter transactions per month.
Transaction fees apply to all accounts with
the Credit Union with the exception of ESaver and Christmas Club.
Fee rebates are given for electronic
transaction and member cheque
transaction as outlined below
Northern Beaches CU
Rebate of member fees is based on:
Combined balances of deposits and loans for the
month
All Members : Rebate $4.00 per mth
Further: Rebate $1.00 per mth for every $2000.00
of combined balances
Maximum Rebate: $50.00 per mth
Sutherland Credit Union.
Electronic transaction include:
EFTPOS
RediATM
Every member is entitled to a minimum number of free electronic transactions based on
account type and balances held.
Transactions over the free electronic transaction count per month are charged at $1.25 per
transaction.
Balance
Junior
Deeming
MemberPus
Business
Other
Account
Members
Accounts
holders
$0- $4,999.99
15
8
8
5
5
$5000.00 15
8
8
8
8
$24,999.99
$25,000.00 15
15
15
12
15
$249,999.99
$250,000
120
120
120
75
120
Sutherland Credit Union.
Member Chequing Withdrawals
Every member is entitled to a minimum number of free electronic transactions based on
account type and balances held.
Transactions over the free electronic transaction count per month are charged at $2.00 per
transaction.
Balance
Junior
Deeming
MemberPus
Business
Other
Account
Members
Accounts
holders
$0- $4,999.99
N/A
7
7
5
5
$5000.00 N/A
7
7
7
7
$24,999.99
$25,000.00 N/A
12
12
10
12
$249,999.99
$250,000
N/A
100
100
50
100
P AGE 35 OF 41
Business Accounts
Monthly Fee
Business Deposit Book
Transaction fees
Sutherland
Credit Union
$10.00 per
account where
balance is less
than $500.00
$10.00
As above
Northern
Beaches CU
$1.00
-
Cheque Fees
Corporate Cheque enquiry/copy (Trace)
$25.00
Member Cheque enquiry/copy (Trace)
$25.00
Member Cheque Deposit (Trace)
Special Clearance Cheque Deposit
Stop Payment Request On Member Cheque (if
presented)
Stop Payment Corporate Cheque
Cheque Deposit Dishonour
$50.00
-
Northern Beaches CU
$10.00
$5.00
Min $20.00 ( up to $60 per
hour)
Min $20.00 ( up to $60 per
hour)
$30.00
$35.00
$9.00
$10.00
$9.00
$9.00
$9.00
Min $20.00 ( up to $60 per
hour)
$5.00
N/A
$20.00
$8.00
$8.00
$7.50
$15.00
$30.00
$6.00
$9.00
Bank Cheque
Corporate Cheque
At cost
$3.00
Member Cheque Copy
Member Cheque Book
25 Book
50 Book
100 Book
Member Cheque Honour fee
Member Cheque Dishonour
P AGE 36 OF 41
General Fees
Visa Cash Advance
Visa cash Advance Overseas ATM
rd
$20.00 for 3 and
subsequent cards
$4.00
$4.00
Emergency Visa Card (Overseas)
At cost
Redicard Card Fee
Visa and Redicard Replacement Fee
PIN Change
Northern Beaches CU
$1.00 per mth.
$5.00
$5.00
$AUD equivalent of USD
175.00 at request.
rd
Visa Card Replacement (Overseas)
Emergency Visa Card Overseas Cash Request
Visa Card Currency Conversion Fee
Visa Chargeback
Visa Voucher Retrieval
Document Retrieval from Archive - per item
Dormant Account Fee - per annum
Statement Copies per statement
Voucher Search
Unofficial Agency Withdrawal - at another Credit Union
Coin Handling Fee Sorted
Coin Handling Fee Unsorted
Coin Handling < $100 per deposit
Coin Handling $100 to < $600.00 per deposit
Coin Handling > $600.00 per deposit
Large Cash Withdrawals daily up to $5000.00
Large Cash withdrawals daily > $5000.00
Overdrawn Savings
MemberPlus Membership Per Annum (over 45 years
old)
Audit Confirmation
Xmas Early Transfers or Withdrawals
$35.00 for 3 and
subsequent cards
N/A
At cost
$AUD equivalent of USD
175.00 at request.
3% of conversion amount
$50.00
$25.00
$25.00 per hour
$36.00
$5.00
$25.00 per hour
$0.00
$5.00 per $100.00
2% of deposit
$0.00
$5.00 per $1000.00 of
part thereof.
$25.00
$30.00
$25.00
Min $20.00 ( up to $60 per
hour)
$10.00
$4.00
Min $20.00 ( up to $60 per
hour)
$35.00
$5.00
$15.00
$6.00
$24.00
-
$25.00
-
$10.00
Regular Payments
Periodical Payment Rejection Fee
Direct Debit Dishonour
Quick Debit Rejection Fee
Direct Debit Honour fee
Direct Debit transfer fee
Incoming SWIFT Transfer
Swift transfer Outward Domestic
Swift transfer Outward International
Swift transfer trace
Direct Entry Trace
Sutherland Credit
Union
Northern Beaches CU
$8.00
$22.00
$8.00
$8.00
$5.50
$25.00
$40.00
$50.00
$25.00
Nil
9.00
N/A
$6.00
Nil
$15.00
Nil
P AGE 37 OF 41
Currency and Funds Transfer
Sutherland Credit
Union
Foreign Currency Deposits - Cheque
Inward Foreign Cheque Dishonour Fee
Overseas Draft
Overseas Telegraphic Transfer in non A$
Overseas Telegraphic Transfer in A$
Foreign Currency
Cash Passport
-
Northern Beaches CU
$10.00
Nil
$15.00
$20.00
$50.00
1% minimum $4.00
1.1% of reload minimum
$15.00
* Note the above Currency and Transfer Products will be available to Sutherland members post merger.
Lending Fees
Establishment Fee - Personal Loan
Establishment Fee - Overdraft
Establishment Fee - Car Loan
Establishment Fee - Mortgage
Establishment Fee Mortgage (refer Products)
Mortgage Preparation
Commercial Loan
Top Up loans
Loan Variation
Loan Redraw Fee
Switch fee
Discharge of Registered Mortgage
Monthly Service fee (Interest only loan)
Line of Credit Service fee
Bill of Sale Handling fee
Substitute Security on Bill Of Sale
Revs/VSR Registration
Solicitors Fee for Upstamping of Mtge/BOS
Other Solicitor & Third Party Fees
St
Credit Facility 1 Arrears Notice
Credit Facility Default Notice
Agent Field Call
Credit Bureau Listing fee
Solicitors Letter of Demand
Insufficient Funds/Overlimit Fee
$100.00
$50.00
$100.00
$195.00
$495.00 (Basic)
At cost
$195 plus 0.25% of loan
amount for loans greater
than $100,000.00
At cost
$25.00
$1000.00
$200 plus all Legal fees at
cost
$8.00 per month
$10.00 per month
$65.00
At cost
At cost
At cost
At cost
$25.00
$50.00
At cost
$25.00 per listing
At cost
$25.00 per instance
Northern Beaches CU
$100.00
$150.00
$275.00
$750.00 (3Yr Fixed &
Intro)
At cost
N/A
$100.00
At cost
$25.00
At cost
Nil
Nil
At cost
At cost
At cost
At cost
At cost
$20.00
$20.00
$60.00
At cost
At cost
Nil
P AGE 38 OF 41
Differences in Member Rights and Liabilities
The table below describes differences in the rights and liabilities attaching to member shares
of Sutherland and Manly Warringah
Sharing surplus and
profits in a
demutualisation
Redemption
Dividends
Topic
Sutherland
Manly Warringah
Member shares carry a right
to share equally in any
dividend determined by the
Board and approved by
general meeting.
Member shares carry
no
entitlement
to
dividends
The right to be paid dividends
is subject to any preferred
entitlement
to
dividends
holders of other classes of
shares may have. Sutherland
has Tier 1 preference shares
on issue that carry a right to
be
paid
dividends
in
preference to member shares
Sutherland must redeem a
member‘s member share on
request, and repay the
subscription price if:
the member withdraws all
deposits and repays all
financial accommodation;
Sutherland has sufficient
profits to repay the
subscription price;
Sutherland will not be in
breach of any prudential
standard;
Sutherland‘s capital base
is adequate for purposes
of APRA‘s supervision ;
Sutherland is not subject
to any APRA restriction
on redeeming member
shares;
APRA has not appointed
an administrator to
control Sutherland‘s
business.
In the event of a restructure
involving a demutualisation
only
qualifying
members
(members of at least 1 year
standing) can participate in
any surplus or profits
Impact on transferring Manly
Warringah members
Members will no longer be subject
to a prohibition on receiving
dividends.
However, members
will still have no entitlement to
receive dividends, only a right to
share equally in dividends if paid.
To date Sutherland has never paid
dividends on member shares.
Manly Warringah must
redeem a member‘s
member share on
request, and repay the
subscription price if:
the member
withdraws all
deposits and
repays all financial
accommodation;
Manly Warringah
has sufficient
profits to repay the
subscription price.
Members‘ right to redeem their
member share and have their $10
subscription price repaid will be
subject to additional conditions
that would only apply if Sutherland
was failing to meet its regulatory
prudential requirements as an
APRA regulated
Authorised
Deposit-taking Institution.
No rules limiting who
can share in surplus
and
profits in
a
demutualisation
Transferring Manly Warringah
members will all be qualifying
members entitled to participate in
any surplus or profits in the event
of a demutualisation, because
they will all be taken to have been
members
of
Sutherland
continuously for 1 year as at the
date of the merger for the purpose
of this rule.
P AGE 39 OF 41
Surplus in a Winding-up
Topic
Sutherland
Manly Warringah
In a winding-up of Sutherland
each member is entitled to
share equally in any surplus.
In a winding-up of
Manly Warringah each
member is entitled to
share equally in any
surplus, except where
in a voluntary windingup
the
members
resolve
that
any
surplus be transferred
to another credit union
or company organised
on the basis of the
principles of mutuality.
Warringah members
Transferring Manly Warringah
members will have a right in the
event of a winding-up of
Sutherland to share equally with
all other Sutherland members in
any surplus and will not be subject
to any right
of members
collectively to resolve to transfer
the
surplus
to
another
organisation.
The table below describes other differences between the Constitutions of Sutherland and
Manly Warringah that may impact on the enjoyment of rights and benefits by members.
Demutualisation
approval procedure
Eligibility to be a director
Topic
Sutherland
Manly Warringah
In order to be a candidate for
election as director a person
must:
be a member
have mental capacity;
not be a minor;
have been a member
continuously for at least 1
year as at the date of
nomination (unless the
board grants dispensation
within 28 days of
nomination);
not be disqualified by law
from being a director and
provides Sutherland all
information and consents it
reasonably requests to
determine this;
be fit and proper under the
Board‘s Fit and Proper
Policy.
In order to be a
candidate
for
election as director a
person must:
be a member
have mental
capacity;
Sutherland‘s
Constitution
includes a procedure requiring
member approval by ballot
participated in by at least 25%
of members in each class, and
approved by at least 75% of
votes cast in each class, for any
demutualisation proposal to
have effect. This is in addition
to the requirements at law.
Manly
Warringah
does not have any
Constitutional
procedures relating
to a demutualisation.
Note however that as
a matter of law, a
person can only be a
director if:
they are not a
minor;
are not
disqualified by
law from being a
director.
Warringah members
The additional conditions for
nominating as a director of
Sutherland are:
providing information and
consents to determine if they
are disqualified at law;
being assessed as fit and
proper under the Board‘s Fit
and Proper Policy;
at the date of nomination
being a member of at least 1
year.
The first 2 additional conditions
are consistent with the prudential
standards on fitness and propriety
of directors applicable to ADIs.
The last additional condition will
not apply to transferring Manly
Warringah members as they will
all be taken to have been
members
of
Sutherland
continuously for 1 year as at the
date of the merger for the purpose
of this rule.
This does not relate to the rights
of individual members. However,
it imposes additional conditions on
the ability of members collectively
to approve a demutualisation.
P AGE 40 OF 41
P AGE 41 OF 41

notice of special general meeting

Transcription

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