AN Post Saving Certs

FICOCO

Just wondering if anyone else knows anything about the saving certs issued under scheme 11. I was getting ~40% every 5.5 years on these since 1992 and recently got a letter to say the National Treasury Management Agency has decided not to renew them at this rate!:( I thought retrospective legistation was against the constitution. Is this legal?any one else with any knowledge about this, your insights would be welcome!
FICOCO

irlrobins

What retrospective legislation do you think is being applied here??

dotsman

I thought that 40% was reduced ages ago!

I can't remember exactly. Cashed in a couple hundred Euro worth about 2 years ago (I had them from my communion in the late 80's!). I thought the 40% was only being applied up until the late 90's and it was then reduced greatly. Better off with a bank to be honest.

FICOCO

thanks for your responses, in relation to the retrospective legislation, the terms and conditions of the investment have been changed since i took out these saving certs so surely the govenrment would have to pass a law to change the terms of a state gauranteed investment product restrospectively?? As for the rate being reduced, if you held onto your few hundred DOTSMAN, you would have continued to get 40% on the sum invested each five and half years. If you think about that it really is a great deal. i don't think the Banks rates quite compare!! I think my inital investment has almost doubled by now but the National treasury board whoever they are had decided to stop paying the rate and have written to me tellin me to cash in. I'm just not sure that they have any legal right to change the rules now.

irlrobins

There has been no change in the rules. When you "bought" the saving cert the NTMA committed itself to pay you 40% interest over the five years. After this period has ended, it has the option of continuing to pay interest or to payback your investment plus interest earned. This has always been the case/rule. There has been no change in the rules.

The only surprising element to this is why the NTMA committed to extend the period of paying interest. They will never continue to pay interest beyond the initial agreement period if the interest rate on the cert is higher than the current interest rate. I would have thought that the interest rate at the time of expiration would have been lower than the one the cert was issued at.

dudara

More suited to Banking & Insurance and Pensions methinks.

dudara

broker2008

Try a high yielding interest online bank or savings policy from life company. Pick an amount and save for at least 10 years to make it worthwhile otherwise stick with the bank.

FICOCO

FICOCO wrote: »

thanks for your responses, in relation to the retrospective legislation, the terms and conditions of the investment have been changed since i took out these saving certs so surely the govenrment would have to pass a law to change the terms of a state gauranteed investment product restrospectively?? As for the rate being reduced, if you held onto your few hundred DOTSMAN, you would have continued to get 40% on the sum invested each five and half years. If you think about that it really is a great deal. i don't think the Banks rates quite compare!! I think my inital investment has almost doubled by now but the National treasury board whoever they are had decided to stop paying the rate and have written to me tellin me to cash in. I'm just not sure that they have any legal right to change the rules now.

irlrobins wrote: »

There has been no change in the rules. When you "bought" the saving cert the NTMA committed itself to pay you 40% interest over the five years. After this period has ended, it has the option of continuing to pay interest or to payback your investment plus interest earned. This has always been the case/rule. There has been no change in the rules.

The only surprising element to this is why the NTMA committed to extend the period of paying interest. They will never continue to pay interest beyond the initial agreement period if the interest rate on the cert is higher than the current interest rate. I would have thought that the interest rate at the time of expiration would have been lower than the one the cert was issued at.

Thanks for your insights,much appreciated.
The NTMA did renew my certs at this high rate for ~16.5 years, even though the rates came down significantly over the period of the investment. I suppose I was fortunate to get these rates for as long as I did.

denat

FICOCO wrote: »

Thanks for your insights,much appreciated.
The NTMA did renew my certs at this high rate for ~16.5 years, even though the rates came down significantly over the period of the investment. I suppose I was fortunate to get these rates for as long as I did.

You are, of course, correct and you did nor receive any interest you were not entitled to. The T&C of Savings Certs did guarantee the interest rate applied to that "Issue" in perpetuity. I've had the same experience.

T&Cs may have been changed since.