FeatureNewsState Capture

Race matters – even in the interest rate charged on loans

By Pinky Khoabane


In the article on How FNB robbed Black Bondholders of R3bn and ended in the Equality Court, John Duncan made the following comments but beyond that, I perused research findings by Munro Consulting and Actuaries, which was asked to determine if race played a role in determining the interest rates on outstanding loans at Saambou, whose book was later bought by FNB.
(1) Duncan: You will find that “High Risk” bondholders of all races are discriminated against in exactly the same way”

Mr Emerald van Zyl, the financial investigative consultant involved in the FNB Equality Case responds:

Bondholders of low cost housing are less risk than bonds in High Cost Housing. Most of the clients of low cost housing are government employees like teachers, medical staff, and Police Services, and their monthly instalments are paid with a debit order.

The older your bond, the risk decreases as your salary increases every year and the value of your property increases.

Therefore the statement of Duncan is incorrect.

The Usury Act and the National Credit Act determines that a financial institution cannot increase your interest rate as agreed upon if your account is in arrears or if your risk profile increases. The only time that your agreed interest rate can be changed is if the parties entered into a new agreement

(2) John wanted to know how low cost is defined:

  • Large loans are those registered for more than R 150 000
  • Medium loans are those registered for between R 100 000 and R 150 000
  • Small loans are those registered between R 0 and R 100 000.

(3) Other interesting findings by Munro Report

  • Large loans have an average interest rate of 1% below prime
  • Small loans have an average interest rate of 1% above prime.
  •  Medium loans have an average interest rate of approximately prime.
  • It can be clearly seen that in each loan size category, Black and Coloured clients have higher interest rate gaps than white clients. For example:
  • White clients with large loans pay on average 1.1% below than prime whilst black & coloured clients pay approximately 0.45% below than prime
  • White clients with medium loans pay on average 0.1% below than prime, whilst black & coloured clients pay 1% above than prime.
  • White clients with small loans pay on average 0.75% above prime, whilst black and coloured clients pay more than 2% above prime.
  • Conclusion regarding loan size: The size of the loan originally registered is a key determinant of the interest rate charged. However, in addition to this, the race of the client is significant in determining the interest rate gap.
  • Black and coloured clients within the same loan size groupings pay higher interest than white clients
  • Black and coloured clients within the same product type pay higher interest than white clients
  • Black and coloured clients within the same suburbs pay higher interest than white clients
  • CONCLUSION Black (and coloured) clients in the data set provided are being charged higher interest rates than white clients. This is after taking into account the other determinants of the interest rate charged, i.e.:  Loan size (small, medium and large)  Product type (PR050, PR051, PR086)  Loan type (high cost vs. low cost)  Suburb (across suburbs, and within suburbs)
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  1. Looking at all these issues one must come to the simple solution, that is: nationalise the banks, farms, mines. Under the proper leadership socialism works. Cuba is a shining example.
    The Revolution is overdue.

  2. There was not long ago a frenzy around ‘banking the unbanked’ firstly within the country and then the rest of Africa which in all the strategy sessions was referred to as the untapped gold mine. What was being pushed hard by banks onto this market contrary to what you may expect were not high interest bearing savings accounts so people can accumulate the little they have to make much “cents making rands “ , no it was all out lending in particular low income lending (loans first and loans hard). These were the products that were pushed first and pushed hard. Why push loans to people who basically as is live from hand to mouth? You may ask. People to whom that last R10 in an account means being able to buy bread for today therefore not being able to withdraw it because it is withheld for bank charges is a source of much distress, how is this helping the poor? The simple answer is that it is not, it is not meant to help the poor. See if you understand that banks create money from credit, then the mystery is solved. Yes you may have heard before and thought it was just conspiracy hogwash but it is true, they do LITERALLY create money from granting credit. Add to that the fact that the low income loans attract ridiculous interest rates, banks cream it to the point that when eventually the person is not able to pay anymore they have already made quite a handsome return from basically thin air. Remember that the person is not even off the hook because for as long as they are earning or they will earn in the future, they are still chained to the bank and the loan. Which then keeps growing and as it becomes bad debt, collectors come into play adding their costs and the whole thing becomes a massive albatross around people’s necks for a long, long time. Loan ‘books’ are sold for good reason.
    The point when the true vileness of this whole thing came to light was when there were ideas to now push ‘small building loans’ to the rural people. You know how people in the rural areas build houses over many years as they normally buy what they can afford in cash and build in incremental stages. The beautiful thing about this is that the people actually own their houses, so they finish the houses with no debt (bonds) linked to them. If that is not as close as it gets to real freedom, I do not know what is. We often joke with friends about how we go to the rural areas and come back with our bank owned cars loaded with food (veggies, fruits, free range chickens etc.) often freely given to us by our ‘poor’ relatives. The truth is that hard working people in the rural villages never worry about starving as much as people in the urban areas. Which is why Monsanto and the GM industry needs to be carefully looked at. Making it illegal for people to do as they have always done, saving seeds for the next season’s planting because now these seeds are ‘patented’ cannot be in the interest of humanity. Which effectively means people are forced to go buy seeds each planting season. There is even biotechnology for ‘Terminator Seeds’ which effectively means that the seeds produced by the plant are sterile therefore cannot be planted (Monsanto has said they have not commercialised these terminator seeds) but no one knows what may happen in the future. These seeds becoming more and more expensive. I digress, however these things are all interlinked because looking at the big picture you are able to see how they are made to come together to ensure everyone is under the control of either banks or big multinationals. So the poor person in the rural village who currently is living in a house they fully own able to feed himself and his family with produce he grows and rears himself and maybe even sell surplus to neighbours is enticed towards getting a loan from the bank to ‘build faster’ and year after year buy ‘patented’ seeds whose price is controlled by big multinationals who then have control of making sure that he may need to borrow from the bank to be able to buy the seeds he continues to need for him to plant each season to feed his family. That is how you get to own the world. There are many interesting links on some or all these issues. People can check this one for starters: http://thedeliberateagrarian.blogspot.co.za/2015/08/heres-why-modern-banking-is-evil-system.html . Now, if all the rural folks were to be given title ownership of the land they live in, they may be the first to be truly free in this free South Africa. I am not in any way glamourizing rural living, people in rural areas still face many challenges.

  3. I find it difficult putting my arguements across in this platform (UnCensored), perhaps the well-researched, thought-provoking, objective, and constructive arguments explains this. I admire the persons of Sis’ Pinky Khoabane, The Maytrix, etc. I have never ever came across a news outlet as this which is so matured & professional here in South Africa!!! In the past I used to surf the mainstream-white-owned-news outlets, I won’t lament the fact that I was kicked out & banned from those news outlets, instead I am happy today that my mind have been detoxing itself naturally by staying away from those venomous lies-peddlers. Let alone that it’s journalists are information-bankrupt, they lack maturity, objectiveness, and ethics. In those mainstream news oulets you come across vulgar, toxic world view, hatred, racism towards Blacks, & immatured comments, this being done by commenters under the watch of network administrators without any consequences.

    Thanks God, at last we have a forum full of life and brain-expanding writings.

    Keep it up guys, do not ever give!!

  4. Dear John,

    Personally I have never seen this DISCRIMINATION against the poor so-called ‘blacks’ ‘coloureds’ and Indians; this THEFT, as being based ” .. solely on race .. “. “These people” .. they ‘lika da MONEY’ hey John; “these people” are Greedy Fat Cats, not just racists. They are Multi-BILLIONAIRES e. g. “JR” Rupert; “GT” Ferreira’ “LL” Dipenaar; “PK” Harris (no relative of mine !); “Viv” Bartlett and others

    I Pray that your ” .. dream .. ” comes true John; RESTITUTION by, PROSECUTION of, “these people” will sure go a long way to helping your ” .. dream .. ” to comes true. Right.

    Lord Bless, love Michael (heart).

  5. Thank you for affording me a full article.

    If FNB has not applied its mind fully in granting loans, and has relied solely on race to “assess” their risk in granting the loan and has discriminated between “black” and “white”, then they should be shamed forced to make restitution.

    This only reinforces my dream of a really non-racial South Africa.

    I trust that Uncensored will follow the Equality Court Action and give us insight into the proceedings.

  6. PK,

    Great Info. that you have supplied. Great. Congratulations to you and to Mr. Emerald van Zyl.

    The Fact is that the poor have been charged more on their bonds than the rich have been charged on their bonds by “Rupert and his Afrikaner Mafia gang’s” bank – FRL/FRbL/FNb. It can never be disputed or denied. Year in, year out, year after year after year the poor have been DISCRIMINATED against, because they are poor. Right. Mr. van Zyl and his Actuary Mr. Munro have PROVED this. So the Arithmetic, the Figures, are clear. THERE HAS BEEN DISCRIMINATION AGAINST THE POOR by Saambou; carried on by “Rupert and his Afrikaner Mafia gang’s” bank – FRL/FRbL/FNb.

    The question is : Was this a racist ‘move’ by Saambou; carried on by “Rupert and his Afrikaner Mafia gang’s” bank FRL/FRbL/FNb after Saambou went ‘belly-up’ and “Rupert and his Afrikaner Mafia gang’s” bank FRL/FRbL/FNb effectively bought the MASSIVE Saambou ‘book’ for just R 1-00.

    That is the question that the Honourable Judge will need to ponder before she/he hands down his/her Judgement in the Cape Town High Court.

    Let us look at the ‘Truth of the matter’ PK. Is this ‘just’ a case of STEALING from/ROBBING the poor ? OR is it including a much more sinister factor – racism.

    Saambou was a ‘full-blown’ Afrikaner bank. No doubt about it hey. It is our (shameful – Lord forgive us)) South African History that the Afrikaners HATED the so-called ‘blacks’. Right. It was at Saambou that the STEALING/ROBBING from the so-called ‘blacks’, ‘coloureds’ and Indians began. Right.

    One of the BIG so-called ‘white capital’ Afrikaners, going back some years, was Mr. Rupert’s own father, Dr. Anton Rupert. Right. Anton was the father; Johann is his son.

    Now, it is well documented in our History that Anton was a BIG BROEDERBONDER. Fact. And it is also in our History that the BROEDERBONDERS were extreme racists – basically they HATED the so-called ‘blacks’ – stemming from fear, not fear like being ‘scared’ (they had ALL the guns you see); fear from being outnumbered. For, they knew ‘deep down’ that it would be Democracy that would Triumph, not the Military, when our Beloved Country was, one fine day, set free from the Shackles of Evil Apartheid. And it did in Fact happen – Praise the GOOD Lord JESUS.

    So, if one ‘puts two and two together’, the motivating factor is clearly racist and not ‘just’
    CROOKING, CHEATING, STEALING from the poor – which, incidentally, is BAD ENOUGH hey !!!!.

    One other factor PK : Anton bought a bank for his son Johann. It was Barclays bank; later to be transformed into First National bank; owned !00% by FirstRand bank Limited which is owned by FirstRand Limited – where Mr.Johann Rupert is the ‘king-pin’ – he is actually one of the BIGGEST so-called ‘white capital’ “Afrikaner Mafia gang” LEADERS in South Africa. Right.

    One last point PK is this : The Arithmetic, the Figures, are proved 100% by Mr. Van Zyl and his Actuary Mr. Munro. Right. Now all that needs to happen is for Mr. Van Zyl to be led in Evidence as the Expert that he is so that the the LAW can come alongside the Arithmetic and ‘Bob’s your Uncle’ hey – Judgement for the poor so-called ‘blacks’, ‘coloureds’ and Indians who have been ROBBED by “Rupert and his Afrikaner Mafia gang’s” bank FRL/FRbL/FNb for the benefit of the Shareholders. “These people” must pay back the money and then they must Go to Jail – it is where they belong. Right.

    There is more, much much more PK ….

    Lord Bless, love Michael (heart).

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