Integer | Press releases

SIMON SAYS FORGET THE RING, PAY OFF MY BOND AND I’LL SAY ‘I DO’

12 FEBRUARY 2009
PRESS RELEASE FROM INTEGER

Research shows that a grand romantic gesture is no longer about popping the question. Rather it’s about alleviating financial stress and worry. Financial stress is the biggest passion and relationship killer and as Valentine’s Day looms and darlings the world over contemplate the perfect gift, we suggest you pay that money into your bond and have a romantic time at home.

According to debt counseling expert and author of “Credit Hell – How to Dig Out of Debt”, Howard Dvorkin, "Fifty percent of all marriages end in dissolution, and the number one reason for that is financial pressures."

Says Simon Stockley, CEO of Integer Home Loans, “A better idea would be to light a candle, put some bubbles in the bath, cook a meal and show your prowess as a caring lover by keeping it as safe in the bank, as you would between the sheets.”

“When dinner, roses and a (small) diamond ring can cost you in excess of R10 000, why not invest in your future peace of mind. After all, a man or woman with sexy frontal lobes is considerably hotter than Timothy and Tammy Tart throwing their money away on a night of short sighted pleasure.”

The cost of popping the question around Valentine’s Day would typically cost R 10 469 if you are splurging.

Roses (reference: Interflora website): R770
Valentines dinner (reference: enquiry at Lions Head, 12 Apostles): R1190
Diamond eternity ring (reference: Sterns website): R 8000.00
Moet & Chandon Grand Vintage 2000 (reference: Picardi Rebel website): R 509.00

However if you deposit R10469 into the average home loan account of R750 000, you stand to save R29520 over the total term of your loan (based on an interest rate of 13% - prime less 1 - over 240 months). A saving of R290 000 is perhaps a greater aphrodisiac than the oysters you can ill-afford this Valentine’s Day. Keep the romance hot and heavy, instead of your debt.

The recent interest rate cut of 100bps in the repo rate last week – and the Reserve Bank Governor commenting that he was looking to cut the repo rate even further - is the clearest possible indication that the interest rate cycle and property market has turned. We can realistically see an upturn in real estate prices by the middle of 2009.

“There has never been a better time to buy as prices are low and the interest rate is turning and my best advice to all lovers, friends and frenemies (friendly enemies) is to get in now - at the bottom of the cycle.”

After all home is not necessarily here the heart is. Rather, heart is where the home is.

Editors Note:
Integer is a non-bank mortgage provider offering transactional banking convenience. They offer online transacting and competitively priced mortgage products in competition with the banks.

CEO Simon Stockley aims to position Integer as a private bank for the mass market. Their unique products have revolutionised home loans:

InterCash: a bridging finance facility loaded onto the customer’s Transaction Account and can be accessed via a Visa debit card.

InterCap: protects consumers if rates go up and save when rates go down. It offers a choice of rates, levels of cap and time periods to access the capped product.

STOCKLEY ADVISES CAPRICE TO HOLD ON TO HER ASSETS

9 FEBRUARY 2009
PRESS RELEASE FROM INTEGER

In an open letter to Caprice, international lingerie model and businesswoman, Simon Stockley – CEO of Integer Home Loans - this week advised her to hold on to her two South African properties valued at just over 30 million rand. It was reported last week, in The Times, that the model intends to sell off her assets as she was unhappy with the falling rand and the prospect of South African tenants trashing her homes.

Stockley appealed to Caprice and all other South Africans to hang in there, explore the value in the current property market and see South Africa as a solid investment opportunity and place to do business or visit.

‘Dear Caprice

I know very little about female underwear but something about property and bonds!

You are selling at the worst possible time, just as the market is starting to turn - it's a bit like launching a swimwear range in the middle of a snow storm. Wait for the summer, it always follows winter if you are patient.

The Governors announcement of a 100bps cut in the repo rate yesterday (and his comments that he was looking to pass on an even bigger cut) is the clearest possible indication that, from a South African perspective, the interest rate cycle and property market has turned and we can realistically see an uptick in real estate prices by the middle of 2009.

This coupled with the impetus that the 2010 Soccer World Cup is likely to provide, is likely push prices to the point which will more than compensate for the decline in the value of the rand - which has not been so much a weakening of the rand but a strengthening of the dollar). If cash flow is tight, remortgage and access some of the equity in the property by way of an equity release product like the one offered by Integer. It's a smart way to manage your finances and our innovative 'one account' concept allows you to control your cash flows (via the internet when you are abroad)and take control of your financial affairs.

South African real estate (particularly in the Western Cape) has outperformed the UK real estate market over the last 18 months and showed real resilience in the face of global financial turmoil. We remain a solid investment opportunity but more importantly a great place to visit and do business.

Shout if we can help!

Kind Regards
Simon Stockley’

Editors Note:
Integer is a non-bank mortgage provider offering transactional banking convenience. They offer online transacting and competitively priced mortgage products in competition with the banks.

CEO Simon Stockley aims to position Integer as a private bank for the mass market. Their unique products have revolutionised home loans:

InterCash: a bridging finance facility loaded onto the customer’s Transaction Account and can be accessed via a Visa debit card.

InterCap: protects consumers if rates go up and save when rates go down. It offers a choice of rates, levels of cap and time periods to access the capped product.

COMMENTS REGARDING REPO RATE

14 AUGUST 2008
PRESS RELEASE FROM INTEGER

Comment from Simon Stockley, CEO of Integer Home Loans, subsequent to the Reserve bank decision to leave the key repo rate unchanged at 12%.

“We welcome the Governor’s decision to hold the repo rate steady at 12%. We believe that this is the appropriate response to the current economic climate and will bring some relief to hard pressed South African consumers. This decision should go a long way to reintroducing some positive sentiment into the property sector, which has started to show signs of distress. We do however urge consumers to remain vigilant and to shop around aggressively for the best possible home loan deal, in order to manage their debt in the best possible way.”

Simon Stockley, CEO of Integer Home Loans

INTEGER THROWS LIFELINE TO ABANDONED FNB CUSTOMERS

13 AUGUST 2008
PRESS RELEASE FROM INTEGER

The recent announcement by FNB that they intend to withdraw loan approvals provided to some of their customer, for the purchase of residential properties, is set to cause some major disruptions to the home loan industry.

“Leaving approved customers high and dry is an extreme response to tightening market conditions,” stated Integer Home Loan CEO, Simon Stockley. “The need to make fair, balanced and transparent credit decisions - and to stand by these decisions - is paramount, or hard-pressed South African consumers are once again going to bear the brunt of industry inefficiencies and indifference.”

Stockley’s concern was the possibility of a knock-on effect that could impact not only the purchaser of a property but also cited parties such as sellers, developers, estate agents, valuers and lawyers. “I would invite any person affected by this situation to contact Integer and we will do our best to assist them if we can,” declared Stockley. “We are definitely still open for business and actively seeking to expand our lending book despite tight market conditions.”

Other lenders, including Standard Bank, have also expressed their surprise and concern at the decision by FNB, which effectively erodes public confidence in South Africa’s property market. Since purchases in developments of the sort being reviewed by FNB often involve the payment of deposits, purchasers who have finance withdrawn could find themselves breaching their conditions of purchase and potentially forfeiting their deposits as a result of this action. The knock-on effect of this unilateral action could be profoundly negative.

Rising interest rates and the introduction of the National Credit Act in 2007 have also imposed further lending strictures on the borrowing public. Such events will have placed greater pressure on home owners to repay the higher bond installments on these loans. In many cases, the home loans granted by banks a mere 6 to 18 months ago would today not have been granted due to affordability issues.

“The market is decidedly tougher now,” says Stockley, “but it would seem that rash or, in the least, marginal decision making has now caused a bank to renege on commitments already made.”

Integer has grown its book significantly since launch in October last year having processed over R3.5 billion rands worth of applications, with the committed loan portfolio now rapidly approaching three quarters of a billion rand. An inaugural securitisation issue is planned for later this year.

INTEGER INTRODUCES RATE INSURANCE TO HELP CONSUMERS

26 JUNE 2008
PRESS RELEASE FROM INTEGER

Integer will be launching InterCap - a capped rate adjunct to their existing home loan offering - on 01 August 2008 in response to consumer concerns over rising interest rates. The advantage of a capped rate is that if rates go down, the borrower enjoys the benefit of savings and is not locked into a higher rate for that duration.

The non-bank home loans company, which offer home loans in competition to commercial banks under the slogan ‘Home loans made clever”, are introducing the product to give hard-pressed South African consumers the option to take back control of their financial affairs.

InterCap is an innovative interest rate protection mechanism that allows the borrower to enjoy the benefit of falling interest rates, but prevents further increases to the bond rate at a chosen level. “We are excited that we have the opportunity to offer a sophisticated interest rate hedging mechanism which was previously not widely available to retail consumers,” says Simon Stockley, CEO of Integer Home Loans. “We see this as part of our ongoing commitment of being a consumer champion and giving South Africans control of their financial affairs”.

The InterCap offering allows a customer to choose the level at which they want to cap their rate – either at the current bond rate or at an increase of 0.5, 1.0, 1.5 and 2% out of the money. In addition, the customer chooses the duration of the cap - one, two or three years and chooses the level at which they want to cap the rate (for example, for the full bond amount or any other portion, perhaps fifty percent). The actual cost is determined at the time of the sale and is a function of the yield curve at the time.

Discussions and feedback from the Integer customer base have indicated that South African consumers are hurting and many fear further interest rate hikes will simply push them over the edge. “The InterCap product has been designed in response to those fears and we expect strong consumer take up”, said Stockley “In pricing the offering to consumers we have aimed to pitch it at a level where affordability is the key driver. Any home owner concerned about further interest rate increases should give serious consideration to taking out buying interest rate protection”.

There is no cash outlay and, if taken up, InterCap is capitalised to the home loan account. It will be sold as an ancillary benefit to the home loan and does not vary the legal nature or fundamental benefits of Integer’s transactional banking (salary sweep) offering but simply kicks in and pays away increased installments if rates should rise. Says Stockley, “It should be seen as interest insurance for home owners”.

For further information including a document with indicative pricing on Prime linked capped products, based on an average loan of R700 000, please contact:

FD Beachhead
Dani Cohen - 021 487 9000 - dani.cohen@fd.com
Jean Dennis - 021 487 9000 - jean.dennis@fd.com

Integer
Simon Stockley, CEO - 083 276 0068 - simon.stockley@integer.co.za

DOUBLE WHAMMY FOR CONSUMERS AS BANKS PRICE UP AND REDUCE EXPOSURE

11 JUNE 2008
PRESS RELEASE FROM INTEGER

Integer introduces rate insurance in the form of InterCap
Consumers are protected if rates go up and saves when rates go down
InterCap offers a choice of rates, levels of cap and time periods to access the capped product

Integer will be launching InterCap - a capped rate adjunct to their existing home loan offering - on 01 August 2008 in response to consumer concerns over rising interest rates. The non-bank home loans company, who offers home loans in competition to commercial banks under the slogan ‘Home loans made clever”, are introducing the product to give hard-pressed South African consumers the option to take back control of their financial affairs. The advantage of a capped rate is that if rates go down, the borrower enjoys the benefit of savings and is not locked into a higher rate for that duration.

InterCap is an innovative interest rate protection mechanism that allows the borrower to enjoy the benefit of falling interest rates, but prevents further increases to the bond rate at a chosen level. “We are excited that we have the opportunity to offer a sophisticated interest rate hedging mechanism which was previously not widely available to retail consumers,” says Simon Stockley, CEO of Integer Home Loans. “We see this as part of our ongoing commitment of being a consumer champion and giving South Africans control of their financial affairs”.

The InterCap offering allows a customer to choose the level at which they want to cap their rate – either at the current bond rate or at an increase of 0.5, 1.0, 1.5 and 2% out of the money. In addition, the customer chooses the duration of the cap - one, two or three years and chooses the level at which they want to cap the rate (for example, for the full bond amount or any other portion, perhaps fifty percent). The actual cost is determined at the time of the sale and is a function of the yield curve at the time.

Discussions and feedback from the Integer customer base have indicated that South African consumers are hurting and many fear further interest rate hikes will simply push them over the edge. “The InterCap product has been designed in response to those fears and we expect strong consumer take up”, said Stockley “In pricing the offering to consumers we have aimed to pitch it at a level where affordability is the key driver. Any home owner concerned about further interest rate increases should give serious consideration to taking out buying interest rate protection”.

There is no cash outlay and, if taken up, InterCap is capitalised to the home loan account. It will be sold as an ancillary benefit to the home loan and does not vary the legal nature or fundamental benefits of Integer’s transactional banking (salary sweep) offering but simply kicks in and pays away increased installments if rates should rise. Says Stockley, “It should be seen as interest insurance for home owners”.

BE A 'RATE TART' AND SAVE ON YOUR BOND

29 MAY 2008
PRESS RELEASE FROM INTEGER

SA’s home owners might have to become ‘rate tarts’ – a term coined in the UK for consumers who constantly chase better deals from lenders – in order to limit the pinch of rising interest rates.

“As interest rates continue to soar, home buyers will have to negotiate more aggressively with lenders. Given the current economic climate, South Africans need to develop a culture of bargaining and hunt for better deals. There are clear signs that demand for property has dwindled, therefore lenders might be more willing to bargain – something they have been extremely reluctant to do in the past, says Simon Stockley, CEO of Integer.

“Amid soaring food and fuel prices, clinching a good deal on a home loan could offer homeowners some relief. Although lenders offer various incentives such as household insurance it is the interest rate that consumers should be interested in.”

Traditionally South African banks have had a tendency not compete on price and have never advertised their lending rate. A borrower has been expected to negotiate a discount to the quoted lending rate (prime) and these discounts have, by and large, remained secretive and have been dealt by lenders on an ad hoc basis. Shrinking margins and activity in the property sector may well change all of this and Stockley sees a new era where banks may well now actively advertise and compete on price. In this way, they will potentially erode each others’ market share.

Another significant development is the emergence of a ‘cancellation or defend rate’. This occurs where an existing customer of a bank threatens to cancel their mortgage and move to another lender, prompting the defend or cancelling department of the bank to offer a further rate concession to the irate customer in order to prevent them switching. In order to take advantage of this new phenomenon, Stockley encourages customers to actively engage with their existing lenders and to discuss with them the possibility of switching their mortgage in order to extract maximum leverage.

“Although there are costs involved when moving your mortgage from one lender to another, ( generally around one percent of the value of the loan ) these can be covered by the equity available in the new home loan and these are , as a rule of thumb, recovered within 18 months of making the switch, ” adds Stockley.

In the past 20 months, the Reserve Bank has raised interest rates by 350 basis points. This means if you bought a house for R500 000 in July 2006 when rates were at 11.5%, you would have been paying R5 332 a month.

Home loan lenders raised their rates to 15% after the Reserve Bank pushed interest rates by 5 basis to 15% in April 2008. A R500 000 home loan will now fetch R 6 583 a month, and this implies a 23% increase in his repayment amount since July 2006.

INTEGER SET TO SHAKE UP BRIDGING FINANCE INDUSTRY

10 APRIL 2008
PRESS RELEASE FROM INTEGER

Integer, South Africa’s newest mortgage lender has launched a revolutionary bridging finance product (InterCash) set to transform the bridging finance market.

Bridging finance has become a significant by product of the mortgage market with advances currently totaling in excess of R1 billion. In essence, service providers (predominantly non-bank lenders) have entered the market to provide temporary cash facilities or advances to those either awaiting the proceeds of the sale of a property or a re-finance by switching or re-advancing on their current mortgage. The advance of these funds (typically for periods of between 30 and 90 days) is designed to facilitate cash flow during the period during which the legalities surrounding the registration of a mortgage bond take place.

The difference with the Integer product is that the bridging finance facility is loaded onto the customer’s Transaction Account and can be accessed via a Visa debit card (as opposed to being advanced in cash) immediately on signature of the customer’s loan agreement. The Integer customer pays only for funds actually drawn down as opposed to total funds made available, thereby dramatically reducing the costs associated with this facility. The customer can likewise pay back at any stage the funds advanced and thereby avoid interest charges. Integer is currently the only company offering such a product in the South African market.

Simon Stockley, CEO of Integer says, “InterCash, our bridge finance offering will radically transform the bridging finance market. Unscrupulous operators have been charging usurious raising fees and rates as high as prime plus twenty percent. Our product is extremely competitively priced for what amounts to an unsecured revolving credit facility (Integer charges interest at prime plus two percent) but more importantly, customers can use the facility as a revolving credit plan during the registration phase of the mortgage, paying interest only on funds that they use.“

If a customer is approved for the InterCash facility they will be granted access up to 80% of loan funds to be advanced, less the outstanding balance owed to the existing lender or up to eighty percent of the proceeds to be paid out in relation to the mortgage in the event of there being no existing encumbrances on the property. This means that a customer granted a new home loan of R1 million by Integer and existing debt of R600 000 on that home loan, will be eligible for bridging finance on the remaining R400 000. Therefore, R320 000 – calculated as 80% of R400 000 – will be available on the customer’s Transact Account, within 24 hours of signing their home loan and bridging finance loan agreement.

“This product gives us a significant advantage in attracting customers away from the banks,“ adds Stockley. Banks have adopted stalling and dilatory tactics in response to Integer’s aggressive switching strategy forcing customers in many instances to wait up to 150 days to pay off existing mortgages.“ InterCash will allow us to advance funds to our customers during this period, allowing them to better manage their cash flows and potentially pay down expensive short term debt.“

Note to editor:

Launched in Oct 2007, Integer has already attracted over R1 billion in loan applications. Over R700 million of these applications were from customers with existing mortgages looking to switch to Integer for either improved rate or better home loan features as well as responsive service levels. “This figure clearly demonstrates the high levels of dissatisfaction and distrust consumers have with current lenders.”

“We take the matter of providing responsible access to credit very seriously.” says Stockley. “The InterCash product will be made available to customers who meet Integer’s credit requirements. Upon registration, the outstanding principal amount and interest due on the InterCash facility is repaid from the proceeds of the Integer Home Loan which continues to operate in the normal manner.”

FACT SHEET - PRODUCT NAME : INTERCASH

10 APRIL 2008
PRESS RELEASE FROM INTEGER

Funding Availability and size of facility to customers: The InterCash bridging facility provides access to up to 80% of the equity released in the customer’s property when switching to Integer.

Availability: Available immediately on signature of the home loan agreement the facility is loaded onto the customers transact account and made available via the Integer branded VISA Electron Debit card (*Issued by BidVest Bank Limited). The facility is in place until registration after which the outstanding balance is repaid from proceeds of the new loan and the facility cancelled.

Security: InterCash is an unsecured facility. Only granting the facility of the actual equity released in the switch transaction after the customer has already signed a power of attorney in favour of Integer to register the bond mitigates the risk.

Comparative Bridging finance rates

Integer: Prime +2% *Linked to the Investec Quoted Prime Rate
SAHL: Prime +3%
Non-Bank: 49% per annum

Initiation Fee

Integer: Initiation Fee: R1140 (VAT Incl)
SAHL: Initiation Fee: R1140 (VAT Incl). No facility
Non-bank: No initiation fee. No Facility

Integer distinguishing product features

There are only two South African home loan providers to offer bridging finance, Integer and SAHL’s
Integer offers the most competitive pricing. Integer: Prime +2%. SAHL: Prime + 3% and non-bank offering: 49%
InterCash is provided as a facility. The customer pays only for that portion used and has the ability to repay at any stage. Interest is charged accordingly

Illustrative examples (shown overleaf)

Product comparison on interest rate and initiation fee
Product comparison on facility (withdrawals and deposits), interest rate and initiation fee

Illustrative examples: Integer vs. Bank & non-bank bridge Finance offerings

1) Direct comparison (interest rate and initiation fee)

Comparison: R100k. 120 days

	Integer - Standard comparison	SAHL	Non-bank provider
Product	InterCash	Quick Cash	Bridge finance
Costs	Initiation fee: R1140 Prime + 2%	Initiation fee: R1140 Prime + 3%	No initiation fee. 0.133% per day / 4% per month or 49% per annum
Loan amount	R 100,000.00	R 100,000.00	R 100,000.00
Interest rate	16.50%	17.50%	49.00%
Initiation fee	R 1,140.00	R 1,140.00	R 0.00
Total cost	R 6,564.66	R 6,893.42	R 16,109.59

Savings

Integer vs. SAHL	R 328.77
vs. non-bank provider	R 9,544.93

2) Facility comparison (Use of facility, salary incl. interest rate and initiation fee)

Comparison: R100k. 120 days

	Integer - Standard comparison	SAHL	Non-bank provider
Product	InterCash	Quick Cash	Bridge finance
Costs	Initiation fee: R1140 Prime + 2%	Initiation fee: R1140 Prime + 3%	No initiation fee. 0.133% per day / 4% per month or 49% per annum
Loan amount	R 100,000.00	R 100,000.00	R 100,000.00
Interest rate	16.50%	17.50%	49.00%
Initiation fee	R 1,140.00	R 1,140.00	R 0.00
Total cost	R 2,903.01	R 6,893.42	R 16,109.59

Savings

Integer vs. SAHL	R 3,990.41
vs. non-bank provider	R 13,206.58

Facility Assumptions

InterCash facility the following assumptions have been made:

InterCash offering: Prime +2%. Initiation fee R1000 (excl VAT)
Market offering: (alternative bridging finance providers) No initiation fee. 0.133% per day / 4% per month / 49% per annum

Customer InterCash facility access:

25% withdrawal immediately (R25k)
Salary paid into facility – day 30 (R20K)
25% withdrawal day 30 (R25k)
Salary paid into facility – day 60 (R20K)
25% withdrawal day 60 (R25k)
Salary paid into facility – day 90 (R20K)
25% withdrawal day 90 (R25k)

STAFF ANNOUNCEMENT

26 MARCH 2008
PRESS RELEASE FROM INTEGER

Integer, the home loan provider taking on the big four banks, has strengthened its management team with the appointment of Bruce Sneddon as Chief Financial Officer (CFO).

Bruce is a Chartered Accountant with thirteen years extensive financial and management experience and has held several senior positions, mainly in the financial services industry: Group Accountant for Norwich Holdings, Financial Director and Chief Executive Officer of the Appleton Group and, most recently, as a Finance and Projects Executive for Truworths.

“We are delighted to have Bruce on board. His presence strengthens the current management team and allows us to increase the origination activity across the market”, said Simon Stockley, chief executive of Integer. “South African consumers have responded in a positive manner to the launch of Integer and we are confident that this appointment will allow us to increase service levels and penetration of the mortgage market.”

Recently Integer has increased its offering to consumers by appointing a mobile sales force, to back up their online facility.

INTEGER DRIVES BRAND ON WHEELS

5 MARCH 2008
PRESS RELEASE FROM INTEGER

Mobile advertising is becoming increasingly popular for companies wanting to raise their brand profile among consumers. Integer, the newly launched home loan provider, has boosted its advertising reach by unveiling a fleet of 25 Integer branded vehicles.

Simon Stockley, CEO of Integer says, “The branded cars have broad reach and will raise awareness of the Integer brand wherever they go. Integer doesn’t have a branch infrastructure and the cars provide us with a street presence – they are our mobile billboards. They are already proving effective as our mobile consultants receive at least five calls a month because people are seeing branded cars.”

“We believe the branded cars embody our service promise of convenience. Our mobile consultants will come and see customers in their homes. Alternatively, customers can log onto our website or pick up the phone to our call centre. Most importantly, the cars have our website address (www.integer.co.za) clearly displayed. Almost 50% of our current business comes via our website.”

Stockley believes mobile advertising will pay dividends for Integer as a growing and relatively new brand. “Presentation is key to the success of any new business. The cars are not laden with too much information. Our name and website address are prominent and the company’s corporate colours work beautifully on the shiny black Fiats”.

Integer chose the car brand after careful consideration. Stockley says Fiat’s recently launched Bravo epitomises efficiency and is dynamic and reliable. “All these characteristics illustrate what has become core to Integer’s brand values. Bravo has been nominated as a finalist in the Car of Year Competition for 2008 and achieved 5-star rating for safety from the (Euro NCAP) European New Car Assessment Programme.”

Integer aims to create a strong brand presence across the country but, for now, the cars can be seen in Cape Town, Durban and Gauteng.

Note to editor:

If you would like pictures of the branded cars please contact Jean Dennis or Dumezulu Maphophe on 021 487 9000 or download from the image gallery here.

About Integer
Integer is a specialist home loans provider set up to add competition to the home loans market in South Africa – a market which is still dominated by the big four banks. The Integer product is a fresh and competitively priced home loan with transactional banking convenience. The core of our offer is a standard home loan product, with no hidden charges and no early redemption fees. The product offers two payment variables:

Skip a month - chose a month of the year in terms of which you wish to take a payment holiday

Capital deferment – entry level product designed to address affordability issues at the time of taking the loan – capital deferred for two years

The home loan can be coupled with a transaction account, with full web functionality. When used correctly a borrower will be able reduce the interest payments on the home loan by paying salary and other income through the transaction account and offsetting the debit balance on the home loan account. The account further provides a credit facility, via a debit card, calculated as one percent of the loan value which when drawn down upon attracts interest at the home loan rate.

INTEGER GOES DIRECT WITH R1bn IN HOME LOANS

5 MARCH 2008
PRESS RELEASE FROM INTEGER

Approved home loans exceeding R1 billion
Appoints fleet of mobile sales consultants
18 sales consultants appointed and further 20 to be appointed during March 2008

With approved home loans now exceeding R1 billion since its launch on 1 October 2007, home loan provider Integer has expanded its service offering with the appointment of a team of mobile sales consultants who can meet with customers at their convenience, be it in the comfort of their homes or at work.

“The appointment of the sales force is in recognition of the fact that we believe in giving customers choice. The move is in acknowledgment that not all borrowers wish to interact in an identical manner”, says Simon Stockley, CEO of Integer Home Loans. “Integer currently affords its customers the convenience of dealing through selected mortgage originators, via the call centre environment or over the internet. The deployment of these skilled mortgage advisers now allows our customers the opportunity to meet face-to-face, in the convenience of their own home or office environment.”

The sales force will be supported in their activities by the opening of customer contact centres in the major metropoles during the second quarter of 2008. This roll out of offices adds further convenience to the growing Integer customer base.

“For too long banks in this country have forced their chosen distribution strategy down the throat of consumers - a strategy usually designed to suit their needs and cost constraints and not the consumers. Our approach is in stark contrast to the arrogance and lack of sensitivity to customer needs.”

“The mobile consultants will augment our online facility which is accessible 24-7, and allows for interactive communication with customers and a step-by-step explanation of benefits relating to Integer’s Home Loan.”

Integer’s consultants will service customers in Johannesburg, Vanderbijl Park, Pretoria, Cape Town and Durban. The consultants will be instantly recognizable as they travel around in striking black Integer branded Fiat cars in their fleet.

Consultants can be reached on 0861 4 66 66 4 (or 0861 INTEGER).

About Integer
Integer is an online home loans finance provider which offers competitively priced mortgage products in competition with the banks. Integer offers the convenience of a Visa debit card and internet banking as an adjunct to the home loan offering.

TIPS FOR TREVOR

12 FEBRUARY 2008
PRESS RELEASE FROM INTEGER

Tips for Trevor to make home ownership more affordable

Increase exemption on transfer duty
Abolish attorneys conveyancing monopoly
Tax relief for mortgage payments

Dear Trevor

I would appreciate it if you could please consider the following issues in your Budget Speech this year.

It is increasingly evident that ordinary South Africans are battling to get onto the property ladder. Please consider increasing the exemption on transfer duty from R500, 000 to at least R1 million? This would assist prospective first time buyers to enter into the property market and facilitate the widening affordability gap. In addition, it will encourage activity at the bottom end of the market.

Please could you also assist potential home owners by abolishing the monopoly attorneys hold on conveyancing procedures in SA? I know it’s probably not your department but you should have some influence.

The restriction is no longer valid and adds to the costs and inefficiencies in the property market. Free and licensed participation as property transfer agents would encourage the entry of accounting firms, estate agents and mortgage originators into this space. This, in turn, would improve efficiency and drive down costs. Although, be prepared for rigorous opposition from the lawyers whose vested interest in maintaining the status quo is enormous.

In the same vein how about some tax relief for mortgage payments? The property market is beginning to falter and, as the backbone of the consumer sector, I would urge active intervention. Surely, it is time for us to offer a tax rebate on monthly mortgage payments like other countries who have implemented this successfully. This move would address affordability issues, stimulate confidence in the sector and encourage home ownership – which is one way to entrench the middle class.

Finally, we really need a budget that reflects growth and job creation, as opposed to a morbid preoccupation with inflation. The country needs employment and I would rather see aggressive government intervention to stimulate the economy, even if this spending results in us remaining outside of the targeted inflation range of 3-6 percent.

Yours sincerely

Simon Stockley,
CEO, Integer Home Loans

INTEGER'S BACK-END SYSTEM GETS CRACKING

23 JANUARY 2008
PRESS RELEASE FROM INTEGER

The approval process of a home loan is no easy task; it takes our competitors 5 days while it takes Integer a mere 8 hours. This means Integer has been able to shorten the home buying process significantly. Hence when Associated Motor Holdings (AMH), one of South Africa’s leading players in the automobile industry, diversified into financial services with the view to offer home loans they spoke to us and not the Big 4 banks.

Integer will white label all of AHM’s home loans applications and processing using its groundbreaking back-end IT system known as Hyperion Essbase. This will save AMH the cost of setting up a new IT system and is an endorsement of Integer’s unique product offering in the market.

FEED YOUR HOME LOAN NOW TO FEED YOUR FAMILY FOREVER

18 DECEMBER 2007
PRESS RELEASE FROM INTEGER

Consumers are faced with a perennial choice at this time of year. Should they spend that precious year end bonus on the short term imperatives of turkey and booze, or put it into their home loan, thereby reducing the term of the bond and saving thousands of rand in interest?

Simon Stockley, CEO of Integer Home Loans, says, “Feeding your bonus (or a portion thereof) into your home loan is just about the best investment you can make and can relieve the long term pressure of debt stress.”

“Chances are that that many consumers are paying thousands of rands more on their home loan repayments than they did 17 months ago. Taking prime as an indicative market norm, the average South African pays a monthly installment of R6399 per month on a R500 000 bond and if they have not fixed the interest rate, they will be suffering under the brunt of the eight consecutive interest rate hikes in the last 17 months.”

Many of these consumers have earned a salary bonus in December. However, their bonus will not be employed in good stewardship of their finances. Instead, it will be used to buy gifts and generally fund the festivities over December.

“However, effectively structuring your finances can reduce your total home loan debt significantly. Making an additional repayment in the 13th month will have very beneficial results,” says Stockley.

Most South African consumers are paying a loan priced off the current prime lending rate of 14.5%. “ It is a sad indictment of banking practices in this country that lenders quote their worst rate (prime) and only if you negotiate or shop around will you get a discount to the quoted rate”, he adds.

Similarly, if you pay R5 000 into your bond of R500 000, you will reduce the term by four years and eight months and save R 282 228 in interest.

Stockley also recommends that you stick to a workable monthly budget, avoid unnecessary and expensive short-term debt (like personal loans and credit card advances) and look at paying your salary directly into your mortgage, utilising the concept of a ‘one account”. In this way you are able to consolidate your debt, repay your loan quicker and save vast amounts of interest.

Based on the same assumptions, a combination of paying your salary into your home loan utilising Integer’s Visa card to do transactions and paying a R5000 lump sum annually in your bonus month, for the lifetime of the loan, could change the overall cost of your bond by R313 553 and a saving of 5 years and 2 months.

As festivities get under way this season and South Africans deal with the prospect of having to tighten their belts to try and beat the rising cost of food and fuel, it is in their best interest to take a forward view on the savings they can make on their home loan by investing their bonus prudently.

Note to editor:

Savings calculation example
A salary of R15 176.59 paid into your R500 000 home loan, with an interest rate of 14.5% and terms over 240 months, can reduce the term of your bond by eleven months and save R63 351 in interest. This is based on the premise that the salary withdrawn from this account will be 50% on the 10th of the month, 20% on the 15th, 15% on the 20th and the remaining 15% on the 25th.

CONSUMERS SHOULD NOT FEAR OR IGNORE RISING DEBT

7 DECEMBER 2007
PRESS RELEASE FROM INTEGER

Consumers should not fear their rising debt. There are some practical steps they can take to not only limit the debt, but tackle the bad debt should they get into trouble, says Simon Stockley, CEO of new home loan provider Integer. “But most importantly, don’t ignore the debt.”

“Eight successive rate increases are taking their toll on ordinary South Africans. Personally I hope this is the last one as we seem to be swimming against the stream in global terms. The Reserve Bank Governor’s actions contrast with the more hawkish position of his UK counterpart who cut rates because of concerns of a slow down in the UK economy.

I am not sure we have the balance between inflation targeting and growth in the economy spot on – external factors (oil) seem to be the primary drivers of current pressure and I am of the view that we could have lived with a range outside of the current inflation target (short term) to encourage and stimulate the economy in the run up to 2010.”

To limit rising debt, Stockley says borrowers should:

Shop around aggressively for the best possible deal – negotiate with your current lender and if they do not offer meaningful concessions on rate, consider switching to an alternate lender. Remember you don’t have to sell your property to refinance;
Replace expensive short term debt (credit cards / personal loans / auto loans) with longer term funding (home loans);
Consider accessing the equity in your property by refinancing it to pay down short term borrowings;
Consider fixing or capping your interest rate if you are unable to endure any future rate increases or look at an interest only option as a short term solution to ease cash flow;
Increase the term of your loan (pushing out the term from 20 to say 30 years can ease short term cash flow constraints);
Perhaps even consider downsizing if the pressure on disposable income has become too intense.

If borrowers do get into trouble with debt they must:

Talk to your mortgage provider – explain to them your circumstances and attempt to re-structure your repayments;
Pay something – even if you cannot make the minimum installment you should pay something every month. Your lender will be much more sympathetic to your plight if they see paying something back every month;
Sell your property privately if necessary – do not allow legal action to commence as you will not realise full value.

BESPOKE IT ALLOWS INTEGER TO BEAT BANKS ON SERVICE

14 NOVEMBER 2007
PRESS RELEASE FROM INTEGER

Integer, the new home loan provider with a private bank offering, has designed a custom IT system that allows it to approve a home loan eight hours after receiving supporting documents from the applicant. In contrast, the big four banks take an average of five days to approve a home loan application.

According to Craig Beney, MD of Integer, the Integer IT systems were developed to provide customers with an excellent, fast service that would differentiate it from the service offered by the big four banks. “From the onset, our vision for Integer was to be a home loan provider who offered customers a blue chip service which knocked the socks off the shoddy service SA customers have been used to. Our entire IT system was designed to ensure we could offer this kind of service.”

“Securitisation and offering of home loans are all about accurate pricing. So in order to offer a blue chip service, our IT system had to allow us to analyse and price risk speedily and accurately. Our system does this fast and well.”

Henk van der Merwe, Integer’s head of Strategic Application Development says Integer identified IT as a strategic rather than a support function and prioritised it from day one. “Integer believes that annual IT spend should equal annual salary spend. It is an aggressive approach, but one that is working for us.”

Integer initially approached van der Merwe in October 2005 to make the IT system an integral part of Integer’s fast and sleek service offering. Henk, who comes from a business intelligence background and has been in consulting for six years, is essentially a Hyperion expert and within a month of meeting, Benney accepted an offer to move from Switzerland to Cape Town.

Van der Merwe explains that his passion for the Hyperion system is because it lends itself to so much more than just a database and Client Relationship Management tool, but that it has the ability to factor in security and risk probability as well. “These factors are essential when trying to achieve the shorter turnover time that Integer promises customers”.

Van der Merwe explained that Integer’s IT back-end uses Hyperion Essbase, in a very different way from how its developers intended it. “It forms the back-end of our entire system and does all our calculations – it can be compared to Mircosoft Excel on steroids. It takes 15 seconds to calculate a customer’s full amortisation profile over 240 months. We use it to analyse information in a very fundamental way which allows us to accurately and quickly assess risk.”

The middle part of Integer’s IT system is called Baartnet and is managed and hosted remotely by EMID in Pretoria. It hosts all Integer’s customer accounts and functions as a CRM and workflow tool. Baartnet has been customised to talk to Hyperion Essbase so that it can manage the complexity of Integer’s linked transactional accounts, the capital deferment and skip-a-month homeloan products and the requirements of the National Credit Act.

Integer’s front end is called Babelfish and allows Integer to talk to the world - customers, mortgage originators and staff. Joh Kruger, Integer’s Head of .Net development, says the name comes from Douglas Adam’s Hitchhiker’s Guide to the Galaxy. “In Adam’s universe everyone talks different languages. Babelfish is the little fish you put in your ear which allows you to understand everyone. Our Babelfish does exactly that – it allows the customer to access us in a very friendly and usable way. “

Craig says Integer’s IT system complements their business. “It assists fundamentally in ensuring we have the speed and accuracy that allows us to practically deliver on our service promise.”

SMART CONSUMERS START MORTGAGE HOPPING

5 NOVEMBER 2007
PRESS RELEASE FROM INTEGER

South African consumers are switching home loan providers in a bid to find better service and rates.

“All the signs indicate that South Africans are becoming increasingly switch savvy”, says Simon Stockley, CEO of Integer, South Africa’s newest home loan provider. “Switching your home loan to a new provider may put some much needed cash in your pocket and allow you to save thousands over the long term. Over 60% of the applications we received in our first month of operation were switches.”

Consumers now realise that switching can be easy. Switching involves cancelling your bond and registering a new bond at another home loan provider. The costs are around one percent of the value of the loan and can be covered by the equity available in the new home loan within 18 months of making the switch.

Since the launch on 01 October 2007, 70% of the applications received have been via the Integer call centre and website. Customers are comfortable dealing with a virtual home loan business. "Many applicants represent a market segment that are both switch and technologically savvy and do not necessarily have strongly entrenched relationships with their bank. They are comfortable dealing with a web enabled offering."

Stockley says most people switch to obtain a better interest rate on their home loan. “However, it’s not only savings that consumers are after. Many borrowers are dissatisfied with the poor service and punitive costing of their current mortgage lender, whose inflexibility limits consumers’ choice.” Examples of this are innovative debt consolidation products and the ability to access the additional equity in a property. This option is not usually offered to customers.

“Consumers deserve better. Competition in the home loan sector should encourage more aggressive pricing to the ultimate benefit South African consumer. In the current economic environment, increased choice is vital. The introduction of Integer to the sector will hopefully force the traditional home loan provider to focus more on price and service.”

“With our promise of excellent service, Integer now offers customers more developed home loan products, more in line with a private bank offering. “We have developed a home loan product offering which offers customers flexibility and added value.”

A key offering is the possibility of saving through the Integer transact facility. This offering links their home loan account to an account with an electronic payment facility. Integer’s technology based application suits the fast-paced lifestyle, service expectations and demand for instant satisfaction of the younger customer. The Integer home loan package includes 24-hour access to the Integer website, the Integer Branded VISA Electron card (Issued by BidVest Bank) and instant account inter–transfer.

Stockley says around 40 % of applicants have shown interest in Integer’s capital deferment, possibly indicating that the effect of the increases in the repo rate are now biting into consumers disposable income. Understandably so given that rates are now at their highest level since 1999. With the last and seventh consecutive interest rate hike in October, consumers are feeling the pinch and are looking at ways to save.

“We encourage customers to shop around and negotiate with their mortgage lender. Unless you ask, you are likely to receive the worst rate available. Only if you complain or threaten to leave, will a bank generally offer you a concessionary rate. With us it is different – all of our customers get our very best offer, first time round, without having to ask for it”.

Editors Note:
We are able to supply a scenario analysis of loans with a value between R1 mil, R 1.5, R2 mil, as well as the switching costs for each loan. In addition, we are able to provide a simple example of alternative finance options on a R1m bond and a R300 vehicle.

INTEGER ATTRACTS OVER R100 MILLION IN NEW HOME LOANS

10 OCTOBER 2007
PRESS RELEASE FROM INTEGER

Integer, the newly launched home loan provider set to rival South Africa’s existing mortgage industry with excellent rates and service, captured mortgage applications worth more than R100 million within the first 36 hours of business - and over R120 million in the first week of operation.

Of the new applications submitted, 70% were mortgage switches from other lenders, while 20% were for new home purchases and 10% to refinance bond-free homes.

“This is an excellent start and gives me great confidence that our positioning as competition for the banks is what the consumer wants. People want choice and they are going to have it now that we are up and running," said Simon Stockley, CEO of Integer.

Initially all applications were made via the Integer website and call centre, and following a tie-up with mortgage originators Dimension Home Loans, Independent Bond Originators, HP Nett and Bond Excel, an increase in the rate of applications is expected by the end of this week. The custom-built IT system, which is behind Integer’s ability to make time taken by the mortgage application process less than 48 hours from application to credit approval, was stable throughout.

“With the strong likelihood of a further rate increase this week (following the MPC meeting on Thursday), SA consumers appear to have been sensitised to rates and are shopping around for a good deal," concludes Stockley.

NEW HOME LOAN PROVIDER LAUNCHED

1 OCTOBER 2007
PRESS RELEASE FROM INTEGER

A new home loan provider was launched today with the stated aim of introducing further competition into the South African home loans market which is currently dominated by the big four banks.

The new company, Integer, led by Simon Stockley who founded SA Home Loans in 1999, has as its investors, Investec and Purple Capital, the listed financial services group.

‘We are aiming to replicate what has happened in many international markets by challenging the status quo with a product that is flexible, very competitive on price and provides customers with a service that is personal, easy and fast,’ said Stockley. ‘In a mortgage market characterized by poor service and high costs, we believe that the market is crying out for a fresh option. We are looking for South Africans who are tired of poor service, high interest rate charges and fees.”

The strong points of differentiation for Integer will be service, product, innovation and price. Integer believe that the average South African home buyer has never experienced the fast, professional and personalised service they deserve when committing themselves to probably the largest single investment they will make in their lives.

Craig Beney, Managing Director said, “Integer’s offering amounts to a range of service and product offerings, usually only made available to private bank customers, but we are for the first time extending this range of product offerings to the mass retail market. Thanks to our custom built IT platform, customers don’t have to adapt and search for features. It comes in a personally tailored package. Our turnaround times will be significantly faster than the current average of 5 to 7 days that characterizes the industry. We aim to achieve a full credit approval, including external valuation, within 48 hours. We will be targeting both new and switch customers.”

Integer offers a standard 240 month amortized home loan with two payment variations. Loans will be offered up to 85% of the home value, and up to an amount of R2,5 m. All Integer home loans come with a standard one percent credit facility on a Visa debit card at their home loan rate, and free internet banking.

Financing for Integer’s loan book will be provided via securitization in the capital markets, a technique pioneered in South Africa by Stockley and SA Home Loans. The South African securitization market has grown exponentially over the last seven years with total issuances exceeding R86.7 bn in August 2007. Stockley says in countries such as the UK and Australia, the use of securitization has allowed the home loan market to evolve to a point where banks now only account for approximately 54% of the mortgage market in the UK, and approximately 75% in Australia. “With the South African debt markets now rated as the 6th most liquid in the world (source:BIS) and the relaxation of exchange controls allowing offshore funding, there is an opportunity for 2 new entrants into the home loan market, increasing competition and benefiting home buyers and owners.

“We do not see the current US sub prime meltdown as a problem for launch,” said Stockley, “but rather as an opportunity. Once the dust has settled, asset managers will once again be seeking quality mortgage assets to fund and we are targeting the very best underlying collateral. Also, an element of caution is not misplaced in the quality of the initial book insofar as that impacts on its rating and the ultimate cost of capital funding.”

MANAGEMENT BIOGRAPHY

1 OCTOBER 2007

Simon Stockley, CEO

Graduating with a Bachelor of Law degree in 1985 Simon Stockley, after serving articles of clerkship, left the profession to pursue an independent career in property development and marketing, establishing and managing the Townhouse Group of Companies over a ten year period.

In 1999, he established South African Homeloans, South Africa’s first discount home loan specialist and non-bank mortgage lender. He was appointed the company’s first Chief Executive Officer in 2000, a position he held until his resignation in October 2004. During his tenure as CEO of SA Home Loans, the Company grew its mortgage portfolio from a zero base to in excess of R20 billion ($3.5 billion).

Simon has received numerous awards in recognition of his management and, particularly, his marketing expertise, including The Institute of Marketing Managers’ KwaZulu Natal Marketing Man of the Year Award and The British Airways/Natal Mercury Business Excellence Award.

He has spoken widely, both locally and internationally and has written numerous articles on “securitisation”. He led the team which brought South Africa’s first residential mortgage backed security issue to the market in November 2001 (Thekweni 1) and was, subsequent to this issue, intimately involved in the structuring and marketing of a further three Thekwini bond portfolios.

Since November 2005, Simon has been retained by Kingdom Installment as an advisor to the Board. Kingdom Installment is a specialist loan finance company operating in the Kingdom of Saudi Arabia. During this period, Simon successfully launched the Gulf’s first Sharia compliant mortgage securitisation program (KSA MBS) and executed a strategic alliance on behalf of the company with Arab National Bank and the International Finance Corporation, in terms of which KIC will be recapitalised in excess of $550 million, making it the largest specialist home loan finance company operating in the GCC.

In November 2006, Simon merged his investment and consulting activities under Catalis (Pty) Ltd, through which entity he now consults to a wide range of both national and international customers And in addition to Simon’s executive responsibilities Simon acts as Non–Executive Chairman to a specialist mortgage finance company in Ghana, Ghana Home Loans.

SECURITISATION

27 SEPTEMBER 2007

Mortgage securitisation is the process whereby a pool of home loans are packaged together and sold as financial instruments into the capital markets. The interest payments and capital repayment form the basis of the value and security of the instrument. In this way, a home loan provider is able to raise the money required to finance its loans, without having to take deposits.

For example, a home loan provider is going to make 10 mortgages to home buyers in South Africa. Each mortgage has a 20 year term, is worth R2 million and pays a fixed interest rate of 10%. The home loan provider therefore has an asset that comprises the interest payments over 20 years (R2 million each year), plus the capital repayments in 20 years time (R20 million).

Through securitisation this asset can be sold to investors in the domestic and international capital markets. Its value will be determined by a combination of the net present value of the mortgage cashflows, and an assessment of the risk of the mortgages. Through this process, home loan providers are able to raise money today, on the back of promised payments in the future.

Such securitisation began with the financing of mortgage pools in the 1970s in the United States. For decades before that, building society or saving and loans were essentially term lenders; they held loans until they matured or were paid off. These loans were funded principally by deposits, and sometimes by short term debt, which was a direct obligation of the funder. But after World War II, banks simply could not keep pace with the rising demand for housing loans, and therefore other sources of finance were required. The market grew rapidly in the US and soon travelled abroad as both investors and lenders saw advantages in the process.

Securitisation came relatively late to South Africa (first issuance was in 2000), mainly due to the fact that for historical and exchange control reasons the debt capital markets remained small and isolated to international developments. However, over the last 7 years South Africa’s markets have grown significantly and are now believed to be the 6th most liquid in the world. This has opened up the securitisation market which has grown from around R6.5bn in 2001 to over R86.7bn in August 2007. (Source: Investec) Theoretically any type of loan (auto loans, student loans, credit card receivables) can be repackaged in such a manner but investors generally favor securities backed by property (RMBS) as they are considered less likely to default and in the event of a default the funder has access to the underlying property as collateral.

For lenders, the primary advantage is that securitisation reduces the cost of funding, which in turn benefits the home buyer as interest rates on mortgages come down. Securitisation also more closely matches both the term of the underlying mortgage with that of the security, thereby reducing funding mismatches. For investors, they have access to a financial instrument that provides a relatively high rate of return when compared to cash, equities or traditional debt instruments, and that also create greater portfolio diversification for them.

For further information please contact:

FD Beachhead
Dani Cohen - 021 487 9000 - dani.cohen@fd.com
Jean Dennis - 021 487 9000 - jean.dennis@fd.com

Integer
Simon Stockley, CEO - 083 276 0068 - simon.stockley@integer.co.za

Integer is a Registered Credit Provider (NCRCP670)
and an Authorised Financial Services Provider.