Punjab National Bank - fixed rate deposits

jayship

I have an account with them and was opened at the branch. Excellent service and fairly good rates. However should you need to withdraw funds from a long term fixed account after 12 months no penalty is incurred. The big plus was that interest is paid at the rate applicable for the period you had the money on deposit.

eg. 3 years fixed @ 4%. You decide to close the account after 18 months. They will pay you interest at the rate applicable to 18 month deposit. Alternatively you can borrow money against your deposit at 0.5% above the rates you are being paid as part withdrawal is not allowed. It is one of the top 5 banks in India. You can open the account in joint names to maximise FSCS protection.

s20544

Jayship, Others,

I am interested in the fixed deposit accounts offered by PNB International, but I have four questions. (I called PNB today but my call was not answered so I was not able to put my questions to them). Perhaps you know the answers...

1. Do you have to have £100k+ deposited to benefit from the higher advertised rates e.g. 5.8% for 5yr deposit? (It is not very explicit on their website).

2. Can the fixed deposit accounts be closed early before maturity? Their terms and conditions state that the accounts can be closed early 'at the banks discretion'. This doesn't seem certain.

3, If the fixed deposit accounts can be closed early would it not be sensible for everyone to choose the 5yr term so they would have the option/possibility of the higher rate if they found that they were able to leave their money deposited for a longer term than first antcipated? (I assume that if someone chose to close the account earlier they would simply get the rate applicable to the shorter period).

4. The web-page for the fixed deposits states that one of the options for payment of interest is 'Reinvestment' with no interest paid until maturity. I require this option so that I can defer the tax payable on the interest. If I have to deposit in excess of £85k FSCS guaranteed ammount to get the higher rates, I would like to hold the account in joint name with my wife to increase the FSCS protected value above £100k. All good so far . . . . but my question is ..... could I remove my name from the account shortly before closing the account or before it matures so that the interst (paid only at closure or maturity) is paid solely to my wife? (My wife pays a lower rate of tax)

I recognise that the last question is very specific and I'm likely to need to speak with someone from PNB

Thanks for any information that can be offered...

jayship wrote: »

I have an account with them and was opened at the branch. Excellent service and fairly good rates. However should you need to withdraw funds from a long term fixed account after 12 months no penalty is incurred. The big plus was that interest is paid at the rate applicable for the period you had the money on deposit.

eg. 3 years fixed @ 4%. You decide to close the account after 18 months. They will pay you interest at the rate applicable to 18 month deposit. Alternatively you can borrow money against your deposit at 0.5% above the rates you are being paid as part withdrawal is not allowed. It is one of the top 5 banks in India. You can open the account in joint names to maximise FSCS protection.

jayship

S20544. I have just spoken to my local Branch Manager.
This particular investment is a STEP UP BOND at the rates indicated by poster No1. The average interest over a full 5 year term works out @ 4.6% but 5.3% accumulated.. The minimum deposit is ONLY £1000
The account can be closed at the end of 2nd anniversary. Should you choose to close after 26 months the interest will only be applied for a 24 month period. Hence u will lose out 2 months interest. The moral is to close on anniversary or use the option of a loan against your investment.
Q No 3. Yes it does make sense to invest over a 5 year term to maximise the interest earned.
Q No 4. Annual interest is added to your investment on each anniversary and paid in full at maturity or early closure. Hence the accumulated works out @ 5.3% over 5 years.
The account will remain in JOINT NAMES until maturity. You will not be allowed to remove your name. If u decide to proceed it would be best to open the account under a single name with a maximum of 85K.
I trust this info will allow u make a decision. You may want to pop into your local branch.

darkvader

opinions4u wrote: »

How do you know they are strong? How do you define strong?

Sorry but I dont have any hard numbers. I do know that the concept of bailing out banks is pretty non existent in India and banks in the league of PNB are the safest around. If you ask me to quantify, I cannot unfortunately. Doesnt say much, but it has been around for over 100 years, during which it has grown a lot and quite successful which is why I am more confident in PNB than most banks out here

PS: I dont bank with them though but know of people who do!

DV

innovate

darkvader wrote: »

I do know that the concept of bailing out banks is pretty non existent in India

The concept of bailing out banks was totally non existent in the entire western world until a few years ago............

soulsaver

The PNB itself I've had 2 term bonds with, no probs in themselves.
But operating the account online is a pain if you dont use it regularly. And why should you with a bond?

But you have to renew your password every ninety days or you are locked out.
Do they email you a reminder? Nah.
Do they tell you you have been locked out before you try 2nd, 3rd, login? Nah (update: it does show you now on the webby when you try to access - I didnt notice if it was at the first attempt)

And your new password cant be the same as one of your previous 4! So? I'll just password1, then password2 etc?
Nope - you cant use repeats of more than 4(?) consequetive letters from prior passwords!

Combine that with their requirement for a password special character (so it wont be one of your 'usuals') so maybe not sure which you may have keyed in incorrectly.
When you finally do the unlocking process on the phone they write with a new access code... which may take upto 14 working days to get to you. You have to return an acknowledgement slip with your mobile number, they then text you to say the account is accessable with the new details. Enter all details - then you have to change them to your choices & hope you dont get locked out again.

And if I remember it well the password reinstall is a poor design screen, but I'll update that when I get my letter with new password/ access/whatever...

By then they hope you've slashed your wrists...

And finally to make things worse currently some of the telephone numbers listed on their webby are not working. I was on the to the tech line and asked to be transferred to someone re their bonds to be told to phone the number shown online. Which is poor, but worse was to find the number on the home page not working, and the first branch number I tried not working.
Back to the tech line who said they were 'moving' & gave me a mobile number to ring!. I asked them to phone me instead which they did within 20mins tbf.

If I'm honest I wouldn't go within miles if they weren't FSCS covered - it does come over 'tinpot'.

soulsaver

innovate wrote: »

The concept of bailing out banks was totally non existent in the entire western world until a few years ago............

Point well made re you never know whats round the corner - but not actually non existent ... loads, few below but there are more going back a hundred years or more...
http://www.propublica.org/special/government-bailouts

And Sweden in 1990s:
http://en.wikipedia.org/wiki/Bailout#Swedish_banking_rescue

Kippaxman_2

Punjab National Bank are offering excellent long term fixed rates. However, many people seem dubious, thinking they are too good to be true. They are registered with the FSA/FSCS so doesn't this mean your money is definitely safe up to the FSCS limit and therefore there is nothing to worry about?

missile

Have we forgotten the problems the Icelandic banks?

innovate

Your deposit is safe up to £85K but the interest is not guaranteed.

I believe you can, however, withdraw your money early and without penalties if they inform you that they will not achieve their originally expected returns.