New Fee Structure Provides Customers with Value Choice - 18th October 2000

The new system moves from a set "number" of free transactions to a "dollar value" of free transactions offset by the monthly rebate, which ranges from $6 to $15.

The new fee structure allows the customer to easily calculate and choose the best combination of transaction types.

"The new fee structure rewards people who bank electronically," said Mr Mike Pratt, Chief Executive Officer, Australian Financial Services. "The old system of a set number of free transactions does not allow people to take full advantage of the cost savings provided by electronic transaction methods."

"The new simplified structure provides customers with clear choices when transacting with the National. The value of one branch withdrawal is equivalent to three cheque payments or five ATM, EFTPOS or phone transactions or 15 Internet transactions," said Mr Pratt.

The new "rebate" system will benefit community groups:

Under 18 year olds continue to pay no fees (except for the use of non-National ATM machines).

Retirees and Tertiary students will be given a minimum of $12 worth of transactions each month, which provides four branch withdrawals, or 12 cheque payments, or 20 ATM, EFTPOS, Phone transactions, or 60 internet transactions. This compares with the old system of four free branch withdrawals/cheque payments within a total of only 8 free transactions.

Customers with Disabilities will now receive 17 instead of eight free transactions with a minimum "value" of $6 worth of free transactions."

All customers will benefit. The new fee structure means a FlexiAccount customer will get a minimum of 10 free ATM, EFTPOS, Telephone transactions, or 30 internet transactions instead of eight.

A quick reference guide is attached and a fee calculator can be accessed via the National web site. A guide to fees and charges booklet is available from all National outlets.

The new structure will continue to allow customers with total deposits and loans of $20,000 or more, or who participate in the National shareholder scheme, to have all their savings and transaction accounts free of transaction and monthly account service fees (except when using non-National ATMs).

"This is regardless of whether they use one of the hundreds of National outlets throughout Australia, a National ATM, or the thousands of merchants offering EFTPOS," Mr Pratt said.

To further improve National's community strategy, the National will now also provide benefits to customers who have less than $20,000 in total deposits and loans. For every $5,000 in total deposits and loans customers will receive an additional $1 worth of "free" transactions.

In other words the National's improved fee structure generates benefits to the customers who have balances from $5,000 to the threshold for free transactions at $20,000.

Note that the monthly rebate does not accumulate if not used in a month and excess rebate is not paid to customers.

The introduction of the rebate system coincides with the removal of the minimum monthly balance exemption for the monthly account service fee. This means that all customers with FlexiAccounts, Passbook Accounts and Everyday Savings Accounts will now need to pay a monthly account service fee. However, these customers can avoid the monthly account service fee by transferring their account to a FlexiDirect Account. This can be done by calling 13 22 65. The FlexiDirect Account has the same rebate benefits, which provides from $6 to $9 worth of free transactions per month, but is also free from the monthly account service fee as it does not provide for any "free" branch withdrawals within the $6 to $9 rebate.

"No one likes to pay fees but we believe the new system offers every type of customer a way to minimise or potentially pay no fees," Pratt said.

Retirees, students and customers with a disability do not pay an account service fee under the new arrangements and the rebate system allows, at a minimum, the same number of "free" branch withdrawals as is currently provided; or an increased number of transactions using electronic channels.

The last full fee review by the National was in October 1997. The new fees are effective from December 1, 2000.

In summary the fees charged for transactions in excess of the rebate amount include:

Quick Reference for Personal Transaction Account Fees

®Registered to BPAY Pty Ltd ABN 69 079 137 518