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Bonus Bonds: Your questions answered

You may have a number of questions following the changes announced around the Bonus Bonds scheme, so we’ve provided the following FAQs to help answer these.

Future of Bonus Bonds

For some time, low interest rates have reduced the investment returns of the scheme which affects the size of the prize pool. Since 2009 the annual prize pool has dropped from $100m to $34m in 2020. Covid-19 and its impact on the global economy and interest rates has exacerbated this. With interest rates forecasted to remain low, and possibly reduce further, we expect the prize pool to reduce even more. This will mean the chance of a Bonus Bond winning a prize will reduce further. We believe therefore, that it’s no longer appropriate to accept new investments and we intend to return money to existing customers.

ANZ Investment Services (New Zealand) Limited (ANZIS) is a wholly owned subsidiary of ANZ Bank New Zealand Limited and is part of the ANZ Group of companies. ANZIS is the manager of the Bonus Bonds scheme and is responsible for its management and administration.

We acknowledge that is may be upsetting for some customers. Bonus Bonds has been a much loved product in New Zealand for over 50 years, however, ongoing low interest rates has meant that the amount of money we have available for Bonus Bonds prizes has significantly reduced. Since 2009 the annual prize pool has dropped from $100m to $34m in 2020. With the OCR currently at 0.25% and the possibility of it falling further we expect the prize pool to reduce even further. This will mean the chance of a Bonus Bond winning a prize will reduce further. So we believe it’s no longer appropriate to accept new investments and we intend to return money to existing customers.

  • We cannot accept any Bonus Bond purchases from new or existing customers. 
  • Prior to the commencement of the intended wind up, existing customers can continue to redeem their Bonus Bonds through our standard redemption processes, including via MyBonusBonds. 
  • All existing recurring purchases via MyBonusBonds (e.g. direct debits) have been cancelled. Customers with regular payments (e.g. automatic payments) will need to cancel these themselves. 
  • We intend that the prize draw will continue to be held in October. Winners will be notified through the standard processes.
  • Purchases received and processed before 7pm on Tuesday 25 August were processed.
  • Any purchases made after 7pm on Tuesday 25 August (via automatic payment, bill payment, direct credit or through MyBonusBonds) were cancelled and the money was returned back to the customer. All existing recurring purchases submitted via MyBonusBonds were cancelled.
  • Customers with regular payments (automatic payments, bill payments or direct credits) will need to cancel these. 

Investors can redeem their Bonus Bonds before the commencement of the intended wind up and benefit from the October prize draw if you are eligible. 

Or, you can stay in the scheme until it is wound up. In a wind up redemptions will cease and all remaining funds in the scheme are locked in until wind-up is completed. The scheme will be wound up, with all investments sold, expenses paid and the net proceeds paid to remaining Bondholders according to the number of Bonds they hold. This could take up to 12 months. There is a reasonable chance that Bondholders will receive slightly more than $1 per unit in a wind up, however please note that while we don’t expect to pay less than $1 per Bonus Bond, it is possible that the price could be slightly less than $1.

Investors have always paid $1 for a Bonus Bond and been able to redeem them for $1. As with all managed investment schemes, there is the possibility that an investor can lose money and in the case of Bonus Bonds, that the price could be changed up or down. In order to keep the price of a Bonus Bond at $1 we hold reserves as a buffer to protect against this. In a wind up, these reserves form part of the total pool of assets to be distributed to investors in the wind up process.

Reserves in the scheme were $74m at 1 April 2020. 

There will be no impact to those who choose to hold on to their Bonus Bonds. We hold a large number of liquid assets to support high levels of redemptions, however if we think it is in the best interest of bondholders, we could possibly suspend redemptions to treat all bondholders equally. In windup of the scheme, bondholders are entitled to a share of the reserves. There is a reasonable chance that people will receive slightly more than $1 per unit in a wind-up, however please note that while we don’t expect to pay less than $1 per Bonus Bond, it is possible that the price could be slightly less than $1.

We recognise that the timing is challenging in relation to possible COVID-19 lockdowns. We remind existing customers that while they may wish to redeem units now, they are not obligated to do so.

We hold a number of term deposits that will mature within the next 12 months. Final payments in a wind up cannot occur until these have matured or been otherwise realised. As such investors remaining in the scheme should expect to wait up to 12 month to receive any distributions from the scheme. We will consider making one or more partial payment prior to a final payment if we consider this to be both practical and in the interest of bondholders.

In a closure situation, no new Bonus Bonds can be purchased, but you can still redeem your Bonus Bonds and the monthly prize draw continues. The Bonus Bonds scheme was closed at 7pm on 25 August 2020.

In a wind up situation, no Bonus Bonds can be purchased or redeemed and we will return funds to investors as they become available. The monthly prize draw will stop at this point. You will not be able to cash in your Bonus Bonds, instead you will receive one or more distributions from the scheme during the wind up process. There may be a delay of up to 12 months to receive all distributions from the scheme. There is a reasonable chance that bondholders will receive slightly more than $1 per unit in a wind-up situation, however please note that while we don’t expect to pay less than $1 per Bonus Bond, it is possible that the price could be slightly less than $1. We will ensure that we act in the best interest of all bondholders in a wind up situation.

No. The Bonus Bonds scheme is a trust registered under the Financial Markets Conduct Act 2013 as a managed investment scheme. It is completely separate from other products offered by ANZ Bank New Zealand Limited.

Bonus Bonds and Lotto are different products and are not readily comparable. For instance after a prize draw your Bonus Bonds remains eligible for future draws while a Lotto ticket expires.

The decision was made on 25 August 2020, the changes came into effect immediately and there was not sufficient time to contact bondholders individually. A media release and updates to our website were the quickest way to communicate these changes to customers. 

The scheme currently has sufficient assets and reserves to cover all Bonus Bonds on issue, whichever option you choose. The reserves represent the surplus of the value of assets in the scheme over the claims of bondholders.

The Bonus Bonds scheme is a trust registered under the Financial Markets Conduct Act 2013 as a managed investment scheme. As with all managed investment schemes there is the possibility that an investor can lose money and in the case of Bonus Bonds that the price could be changed up or down.  You can get independent financial advice if you are unsure whether you should continue to hold Bonus Bonds. 

The management fee has been significantly reduced over the past few years from 1.28% to 0.40% reflecting the current economic environment. This includes a reduction from 0.95% to 0.40% from 1 July 2020. 

On 1 September 2020 ANZIS stopped charging a management fee. 

ANZ offer a range of savings and investment products that we believe are more suitable for our customers in this economic environment. We encourage customers to seek financial advice or contact ANZ to discuss the options available.

We’ve let you know as soon as we could. The decision to close the scheme to new investment was made on 25 August 2020 and by law the changes come into effect immediately.

Bonus Bonds is a unique product. We recommend bondholders consider the information available on the Bonus Bonds website and on the disclose register (disclose-register.companiesoffice.govt.nz), in order to make a decision for themselves. Alternatively you can seek independent financial advice. The Financial Markets Authority (FMA) give some tips on choosing an adviser and how to find one.

Finding an adviser 

Choosing an adviser 

 

Alternatively you can call ANZ on 0800 269 296 and we can refer you to an independent adviser in your area.

ANZ posted a media release to announce the changes to customers and inform the general public. This information was also posted on the ANZ and Bonus Bonds websites and via social media to assist in reaching a wider audience.  We’ll continue to update the ANZ and Bonus Bonds website with important information and do further advertising, when required, to keep bondholders informed.  

The challenges Bonus Bonds faces are due to the low interest rate environment a new manager would not be immune to these challenges.

Redemptions will cease and all remaining funds in the scheme are locked in until wind up is completed. The scheme will be wound up, with all investments sold, expenses paid and the net proceeds paid to remaining Bondholders according to the number of Bonds they hold. This could take up to 12 months. There is a reasonable chance that people will receive slightly more than $1 per unit in a wind up, however do note while we don’t expect to pay less than $1 per Bonus Bond, it is possible that the price could be slightly less than $1.

Yes. Further Bonus Bonds will be issued to the value of any prize won in the October prize draw where you have set your payment method to reinvest. However, if one of the major prizes ($1m, $100k, $50k) is won by you, we will contact you directly to organise prize payment.

Cashing in Bonus Bonds

Investors have two choices. They can redeem their Bonus Bonds in the coming months before the scheme starts to wind up and benefit from any prize draws that they are eligible for, or stay in the scheme and benefit from the remaining prize draws and a share in the reserves when the wind up is completed. Those who choose to stay during the wind-up phase will have their investments locked in during this process, which may take up to 12 months.

In a wind up we will turn all of the remaining assets in the scheme into cash, pay expenses of the scheme and then return the rest to customers in proportion to the number of Bonus Bonds they hold. As we currently have more than $1 of assets for every Bonus Bond issued there is a reasonable chance that people will receive slightly more than $1 per unit in a wind up, however do note while we don’t expect to pay less than $1 per Bonus Bond it is possible that the price could be slightly less than $1.

  • Suitable forms of identification (PDF 66kB)
  • Proof of address
  • Evidence of name changes e.g marriage certificate
  • Proof of bank account (for non-ANZ account holders) if registering for MyBonusBonds

ANZ has a wide range of options available to assist you with your savings and investment goals and we’d love to talk to you about what may suit your needs. You can call ANZ on 0800 269 296 or make an appointment at your local branch. To find out more information on the options available, you can also check out anz.co.nz. 

If you have $50k or more, your investment time horizon is 4 years or greater and you would like to talk to an ANZ financial adviser about options other than cash accounts or term deposits, we can direct you to an ANZ financial advisor to discuss investment options.  An ANZ financial adviser can provide advice tailored to your situation and create a plan to help you achieve your financial goals. Alternatively, you can get independent financial advice. The Financial Markets Authority (FMA) give some tips on choosing an independent adviser and how to find one.

Finding an adviser 

Choosing an adviser 

There are no present plans to limit Bonus Bonds redemptions. However, in certain circumstances (as described in the governing document for the scheme), we can suspend cash-in payments for up to 30 days if we have good reason to think that cashing in Bonus Bonds is not practicable, or would not be in the best interests of all bondholders.

  • If you have an active MyBonusBonds account you can redeem online before the commencement of the intended wind up by selecting ‘Cash in My Bonds’ from the left hand menu. You can either select an existing bank account number or add a new bank account number to have the funds deposited into. 
  • For ANZ customers who do not have MyBonusBonds access, we encourage you to complete the contact form or call the contact centre on 0800 266 374.
  • If you have an active MyBonusBonds account you can redeem online before the commencement of the intended wind up by selecting ‘Cash in My Bonds’ from the left hand menu. You can either select an existing bank account number or add a new bank account number to have the funds deposited into. 
  • For non-ANZ customers who do not have MyBonusBonds you can visit any ANZ branch. Don’t forget to take appropriate identification and proof of your address (PDF 66kB) with you.

We recognise that the timing is challenging in relation to COVID-19. We remind existing customers that if they wish to redeem their Bonus Bonds  before the commencement of the intended wind up, that redeeming online is the quickest way to receive your funds. However, if you do need to come into a branch, we will prioritise helping our most vulnerable customers, and those who haven't been able to cash in or update their Bonus Bonds online. We’re following Government guidelines to help keep our customers and staff safe. 

You will need to:

  • Meet contact tracing requirements by either: 
    • The Ministry of Health COVID Tracer app by scanning the QR code or 
    • Providing name and contact details to the branch concierge  
  • Maintain physical distancing of 2 metres. 

Note that our staff will have PPE available to them.

If you’re activated for MyBonusBonds you can do it online. Or if you are an ANZ customer you can complete the Contact Form or call the contact centre to get activated for MyBonusBonds. If you’re not an ANZ customer we’ll need to identify you in person. You can do this at any ANZ branch – find the one nearest you.

If the Bonus Bonds are still live and you haven’t previously cashed them in or transferred them, you will still be able to redeem them.

If you have access to MyBonusBonds you can redeem online before the commencement of the intended wind-up by selecting ‘Cash in My Bonds’ from the left hand menu. You can either select an existing bank account number (if you have previously provided us with a direct debit) or add a new NZ bank account number to have the funds deposited into. 

If you do not have MyBonusBonds you can have the proceeds

  • deposited to any NZ account, or 
  • sent to an overseas bank account. 

Simply complete a cash-in request form and mailing it to the Bonus Bonds Centre, along with certified copies of identification (PDF 66kB).

Note: the following details will be required if you request the proceeds to be sent to an overseas account:

  • The account number and full account name of the overseas account to be credited
  • The full name and branch address of the overseas bank
  • The SWIFT, BSB or IBAN number for the overseas bank
  • Confirmation of the currency the funds are to be transferred in
  • A signed acknowledgement that you accept the international payment fee detailed below.

An international payment fee of $28 applies. You may also be charged fees by the intermediary banks used to deliver payments to the recipient bank. The intermediary and recipient bank involved may deduct fees from the amount transferred. These fees vary depending on the currency and bank you are sending the payment to.

 

The address to send all correspondence to is:

Bonus Bonds Centre
Freepost Bonus Bonds
P.O. Box 898
Dunedin 9054
New Zealand

If the purchaser’s details were recorded on the Register when the bonds were bought, ask the purchaser to give you a signed letter giving their authority for you as the child’s parent, to cash the bonds in.  The letter should also contain the child’s full name, date of birth, address and bondholding number – this is an 11 digit number and starts with 841.

Yes, providing you are recorded on the Register, both you and the child have been identified and the child is aged less than 15.

If the child has not been identified, either:

  • their parent can  provide identification documents directly to us or to you to bring in, or;
  • you can provide the parent with a signed letter giving your authority for the child’s parent, to cash the bonds in. The letter should also contain the child’s full name, date of birth, address and bondholding number – this is an 11 digit number and starts with 841.

Only the legal owner of the Bonus Bonds can redeem them. If that person is now 15 (or older), they are now the legal owner of the bonds. They can redeem via MyBonusBonds if they are activated to use this, or by coming into an ANZ branch (with current ID).

We continue to receive high numbers of cash-in requests in branches and we have extra staff employed to assist us process these as quickly as possible.

We aim to process all valid redemption requests within 28 business days after we receive them. However, because of the high volume of redemption request we’re likely to be processing, it may in some cases take a little long than this. 

After 15 days, please return to the branch that you completed your cash-in request. They will be able to see if payment has recently been made or if more information is required. If you require your payment urgently, you can complete an online request through MyBonusBonds and receive your payment within two business days. The branch will be able to assist you with this.

We continue to receive a high number of cash-in requests in branches and we have added extra staff to assist us process these as quickly as possible.

We aim to process all valid redemption requests within 28 business days after we receive them. However, because of the high volume of redemption request we’re likely to be processing, it may in some cases take a little long than this.

Please see below for options that may enable you to receive your funds more quickly and reduce the need for you to come into branch.

ANZ customers:

  • If you have an active MyBonusBonds account you can redeem online before the commencement of the intended wind up by selecting ‘Cash in My Bonds’ from the left hand menu. You can either select an existing bank account number or add a new bank account number to have the funds deposited into.  You will receive payment within two business days.
  • For ANZ customers who do not have MyBonusBonds access, we encourage you to complete the contact form or call the contact centre on 0800 266 374.

Non ANZ customers

  • If you have an active MyBonusBonds account you can redeem online before the commencement of the intended wind up by selecting ‘Cash in My Bonds’ from the left hand menu. You can either select an existing bank account number or add a new bank account number to have the funds deposited into. You will receive payment within two business days. 
  • For non-ANZ customers who do not have MyBonusBonds you can visit any ANZ branch. Please remember to take appropriate identification (PDF 66kB) and proof of your address with you.

Yes it is the same process, however you must ensure that we have the correct documentation as follows:

  • Cash in applications must include a Certificate of Non revocation (CNR) for all claims over $5,000.
  • If you are an attorney, signing a cash in request, then you must inform us, so that our branch staff can note this on the cash in form.
  • An attorney must be registered with us and linked as a signatory.
  • If an attorney has not been registered with us, then we require a copy of proof or authorisation, as well as the usual identification documentation for the attorney and/or the donor depending on the status, plus a Certificate of Non revocation (CNR) if the value is above $5,000.

If the document states all attorneys must sign, then all signatures must be received.

Cashing in involves the same process, however included with the valid application we require a Trust document that will notify us of who the trustees/ signatories are.

These trustees/signatories will then need to present us with their full identification documentation and all will need to sign the cash in form unless the trust document states one trustee can sign alone (this is uncommon). Should the Trust document prove to be historic or signing instructions have been amended since, we require legal documentation that states who the current trustees of the Trust are.

Cashing in involves the same process, however included with the valid application, we require a declaration on the cash in form by the signatory /claimant, that to the best of their knowledge, they are the authorised signatory, and the bondholding was set up by them as an informal trust/syndicate. 

Cashing in involves the same process, however included with the valid application, we require recent Meeting Minutes or a legal document that specifies who the current signatories are.

Bonus Bonds wind-up

Yes. Further Bonus Bonds will be issued to the value of any prize won in the October prize draw where you have set your payment method to reinvest. However, if one of the major prizes ($1m, $100k, $50k) is won by you, we will contact you directly to organise prize payment.

There will be an initial public announcement and this may include notices on the ANZ and Bonus Bonds website and newspaper and radio advertisements.

All valid cash-in requests accepted in branch, online through MyBonusBonds or received directly by the Bonus Bonds Centre prior to announcement of wind up of the scheme, will be processed. en processed when the move to wind up is announced? 

We will make payment to any NZ bank account of your choice.  We will be in contact with you to request your bank account details and recommend you provide us with a current email address and check that your residential address is up to date.  

  • If you have MyBonusBonds, please do this online.
  • ANZ customers, who do not have MyBonusBonds access, we encourage you to complete the contact form or call the contact centre on 0800 266 374.
  • Non-ANZ customers, who do not have MyBonusBonds access, you can visit any ANZ branch. Please remember to take appropriate identification and proof of your address (PDF 66kB) with you.

Redemptions will cease and all remaining funds in the scheme are locked in until wind up is completed. The scheme will be wound up, with all investments sold, expenses paid and the net proceeds paid to remaining Bondholders according to the number of Bonds they hold. This could take up to 12 months. There is a reasonable chance that people will receive slightly more than $1 per unit in a wind up, however do note while we don’t expect to pay less than $1 per Bonus Bond, it is possible that the price could be slightly less than $1.

Investors can redeem their Bonus Bonds before the commencement of the intended wind up and benefit from the October prize draw if you are eligible. 

Or, you can stay in the scheme until it is wound up. In a wind up redemptions will cease and all remaining funds in the scheme are locked in until wind-up is completed. The scheme will be wound up, with all investments sold, expenses paid and the net proceeds paid to remaining Bondholders according to the number of Bonds they hold. This could take up to 12 months. There is a reasonable chance that Bondholders will receive slightly more than $1 per unit in a wind up, however please note that while we don’t expect to pay less than $1 per Bonus Bond, it is possible that the price could be slightly less than $1.

Investors have always paid $1 for a Bonus Bond and been able to redeem them for $1. As with all managed investment schemes, there is the possibility that an investor can lose money and in the case of Bonus Bonds, that the price could be changed up or down. In order to keep the price of a Bonus Bond at $1 we hold reserves as a buffer to protect against this. In a wind up, these reserves form part of the total pool of assets to be distributed to investors in the wind up process.

Reserves in the scheme were $74m at 1 April 2020. 

There will be no impact to those who choose to hold on to their Bonus Bonds. We hold a large number of liquid assets to support high levels of redemptions, however if we think it is in the best interest of bondholders, we could possibly suspend redemptions to treat all bondholders equally. In windup of the scheme, bondholders are entitled to a share of the reserves. There is a reasonable chance that people will receive slightly more than $1 per unit in a wind-up, however please note that while we don’t expect to pay less than $1 per Bonus Bond, it is possible that the price could be slightly less than $1.

In a closure situation, no new Bonus Bonds can be purchased, but you can still redeem your Bonus Bonds and the monthly prize draw continues. The Bonus Bonds scheme was closed at 7pm on 25 August 2020.

In a wind up situation, no Bonus Bonds can be purchased or redeemed and we will return funds to investors as they become available. The monthly prize draw will stop at this point. You will not be able to cash in your Bonus Bonds, instead you will receive one or more distributions from the scheme during the wind up process. There may be a delay of up to 12 months to receive all distributions from the scheme. There is a reasonable chance that bondholders will receive slightly more than $1 per unit in a wind-up situation, however please note that while we don’t expect to pay less than $1 per Bonus Bond, it is possible that the price could be slightly less than $1. We will ensure that we act in the best interest of all bondholders in a wind up situation.

We hold a number of term deposits that will mature within the next 12 months. Final payments in a wind up cannot occur until these have matured or been otherwise realised. As such investors remaining in the scheme should expect to wait up to 12 month to receive any distributions from the scheme. We will consider making one or more partial payment prior to a final payment if we consider this to be both practical and in the interest of bondholders.

Yes, you can continue to view your bonds online, communicate securely with us using Bondmail and keep your contact details up to date.