ak MEMoranDUM Ref. No. PR/O1/10/19 Date: 04/03/19 To : Allhead office organs Regional Offices All branches From 2 The President Chartable Saving Account Procedure has been approved by the Executive Management Committee of the Bank. This is therefore to advise you all to implement Chartable Saving Account Procedure effective March 04/2019 with utmost care. Best regards, MhABAY BANK S.C. CHARITABLE SAVING ACCOUNT PROCEDURE £07 ALGIT M1 LAN verge:(AB. ) ABAY BANKS. - CHARITABLE SAVING ACCOUNT PROCEDURE TABLE OF CONTENTS |. INTRODUCTION... 11. PREAMBLE 1.2. OBJECTIVES... 13. SCOPE... 1.4. GOVERNING RULES... 1.5. DEFINITION OF TERMS.. 1.6. AUTHORITY AND RESPONSIBILITIES . 1.6.1 PRESIDENT... 1.6.2 VICE PRESIDENT CORPORATE SERVICE... 1.6.3 DIRECTOR BUSINESS DEVELOPMENT, MARKETING AND COMMUNICATION. 1.64 — DIRECTOR BORM.... 1.6.5 DIRECTOR INFORMATION TECHNOLOGY AND E- BANKING «0-0 1.6.6 MANAGER - REGIONAL OFFICES... 1.6.7 BRANCH MANAGERS... 2 CHARITABLE SAVING ACCOUNT... 2.1 GENERAL FEATURE. 2.2 SPECIFIC FEATURES. 2.1.1 THE CUSTOMER AND THE ACCOUNT. 2.1.2 MINIMUM DEPOSIT..... 2.1.3 INTEREST RATE AND PAYMENT. 2.3 ELIGIBLE CUSTOMERS AND REQUIRED DOCUMENTS... 23.1 ELIGIBLE CUSTOMERS .. 2.3.2. REQUIRED DOCUMENTS 24 ACCOUNT OPENING... 2.4.1 CUSTOMER CREATION... 2.4.2 ACCOUNT OPENING PROCEDURE 2.5 DEPOSIT 2.6 WITHDRAWALS... 2.7 CLOSURE OF AN ACCOUNT... 3 EXCEPTIONS... 4 REVISION OF THE PROCEDURE...... 5 EFFECTIVE DATE 1 | Abay- Charitable Savile ABAY BANK S.C. - CHARITABLE SAVING ACCOUNT PROCEDURE ACRONYMS BORM Branch Operation and Resource Mobilization RO Client Relation Officer SACHR Chartable Saving Account FCY Foreign Currency kyc Know Your Customer 2 haritable Saving Account Feature, Account Opening And Handling Procedure“Sii2__) ABAY BANK S.C. - CHARITABLE SAVING ACCOUNT PROCEDURE, |. INTRODUCTION 1.1, PREAMBLE Whereas, discharging social responsibility through promoting a socially responsible business practice is set to be one of the corporate core values of Abay Bank: Whereas, realizing such core values & building the Bank's image require development of a teller made Banking products & services that could address the need of concerned group: Whereas, development of a teller made banking product & services will help to attract those entities having immense potential for deposit & foreign currency and enable the Bank to build long-term relationship with such entities & the community as whole, Whereas, there are concerned individuals and charity organizations which are engaged in humanitarian and donation activities that the Bank can work together and discharge its social responsibility while mobilizing vital resources as the same time; Now therefore, a new Charitable Saving Account product is developed to address such targeted customers & this procedure is prepared to guide the proper implementation of the product and to ensure consistency & uniformity in implementation of the product. 1.2. OBJECTIVES The major objective of this Chartable saving account procedure is to set a clear and well understandable reference on the features and technical/operational activities that are expected to be undertaken while opening, maintaining and managing such accounts in each of Abay bank branches. The procedure also has the following specific objectives: A. To Indicate activities and steps that should be followed in opening Charitable Saving Accounts, B. To clearly define and explicitly set roles and responsibilities of different parties involved on implementation of Charitable Saving Account. \ccount Feature, Account Opening And(SB._) ABAY BANK S.C. - CHARITABLE SAVING ACCOUNT PROCEDURE 1,3. SCOPE This procedure will be applicable in all Abay bank branches, Sub-Branches and head office organs that are directly & indirectly involved in the implementations of Charitable Saving Accounts. 1.4. GOVERNING RULES This procedure will be governed by: |. Directives of National Bank of Ethiopia, |, Abay Bank Retail Banking Procedure, Il, Laws, regulations & conventions of the country applicable to banking business. 1.5. DEFINITION OF TERMS. The following words and phrases in this procedure shall have the meaning and definitions prescribed below: |. The Bank- Shall mean Abay Bank S.C. Il Chartable fund: is a fund established by some voluntary individuals or organizations that have an interest to provide donation to support those organizations engaged in charity activities. Ill. Charity Organization: Refers to institutions established exclusively for charitable Purposes and support: poor people, needy, unprivileged section of the society and other philanthropy and support activities. IV. Charitable Saving Account- refers to an interest bearing saving account opened at any of Abay Bank Branches on which an interest calculated and accrued on amount deposited in the account will be transferred to a designated charity organization and ultimately used for charitable purposes 7) | Abay-- Charitable Saving Account Feature, Account Opening And Handling ProcedureCE sway nani sc.-cHanrTApte saviNG accouNT PROCEDURE 1.6. AUTHORITY AND RESPONSIBILITIES 1.6.1 PRESIDENT A. Approves this Charitable Saving Account procedure, B. Shall oversee the implementation of Charitable Saving Account and the Retail Banking Operations procedures; C. Shall provide an explicit, informed and strategic decision on the proper and effective implementation of the procedure as required. 1.6.2 VICE PRESIDENT CORPORATE SERVICE ‘A. Shall oversee proper functioning of the product, B._ Shall oversee the status and progress made on implantation of the product. 1.6.3. DIRECTOR BUSINESS DEVELOPMENT, MARKETING AND COMMUNICATION A._ Shall ensure that, aggressive promotions and advertisements are made using effective ways & channels in order to create awareness about the product, B. Shall Undertake survey, collect opinion (data) about Chartable saving account and recommend improvements based on feedbacks from customers & others. 1.6.4 DIRECTOR BORM ‘A. Shall monitor the proper implementation of Charitable Saving Account across all regions, B. Shall handle complaints related with Charitable Saving Account; Shall ensure that; regional offices are properly discharging alll their duties and responsibilities prescribed in this procedure. 1.65 DIRECTOR INFORMATION TECHNOLOGY AND E- BANKING A. Shall create and incorporate Chartable saving Account on the Bank's core Banking (Flex cube} system as one of the saving account products. B. Shall provide technical support on the system, in relati lartable savin Pr IPP ys eatinn.to chert 9 account. 7 | bay Charitable Saving Accoune ra oR 7‘Sii@_) ABAY BANK S.C. - CHARITABLE SAVING ACCOUNT PROCEDURE 1.6.6 MANAGER - REGIONAL OFFICES A. Shall coordinate & guide operations related with Charitable Saving Accounts; B. Shall ensure that, branches have properly assessed their environment and identified potential target groups for the product, CC. Shall supervise branches under his/her domain and make sure that that duties and responsibilities set for branches are properly discharged: D. Shall follow up & resolve problems & challenges faced by branches in relation to proper implementation of this Charitable Saving Accounts procedure. E. Shall undertake onsite and offsite supervision on branches under its domain; discussing issues that affect the implementation of the procedure; F. Shall initiate necessary amendments & corrections on content & implementation problems which are beyond its control. G. Shall follow up and periodically report, the performance and the amount of deposit mobilized from each branch against their plan. 1.6.7 BRANCH MANAGERS A. Shall create awareness on Charitable Saving Account product for all employees in her/his branch & potential customers interested on the product; B. Shall plan, coach, coordinates and dictates employees regarding expected activities related to Charitable Saving Account operations; . Shall ensure that account opening and daily transaction handling of Charitable Saving Account are done in line with this procedure; D. Shall assess surrounding business environment, identify and recruit potential target groups and maintain strong business relation with those groups. E. Shall Implement this procedure in conjunction with other polices, regulations, the retail banking procedure & Relevant NBE directives, F. Shall clarify the term and conditions of Charitable Saving Account and other related issues to interested customers and staff members in times of any ambiguity. G. Shall report to its respective region regarding: the efforts made, result obtained and overall implementation status of Charitable Saving Accounts. ‘Abay Chartable Saving Account Feature, Account Opering And Hanging Procedure eaABAY BANK S.C. - CHARITABLE SAVING ACCOUNT PROCEDURE 2 CHARITABLE SAVING ACCOUNT 2.1 GENERAL FEATURE A charitable Account is a premium interest bearing Saving Account designed to raise funds from money deposited by those interested individuals, governmental and non-governmental organizations that have an interest to support charity organizations from the interest earned on their money deposited in Abay Bank for this specific purpose. 2.2. SPECIFIC FEATURES The account has the following specific features and characteristics: 2.1.1 THE CUSTOMER AND THE ACCOUNT A. The donating customer can be any individual or organization including existing customers having an interest to donate for charity organizations. B. The donation receiving customer, however; must by a registered charity ‘organization. C. The account can also be opened for a charity organization in order to support another charity organization. D. The donating customer can designate the charity receiving organization and request to open account, however, the bank in its own discretion can select the charity receiving organization in cases the customer has not nominated and is willing to be selected by the Bank. E. Passbook is issued to customers up on opening Charitable Saving Account, 2.1.2, MINIMUM DEPOSIT A. Aminimum deposit of Birr 60,000 and Birr 100,000 is required for individual and organizations respectively to get a premium interest privilege. B. In some circumstance, the account can be opened by a minimum deposit amount; however the’ privileged premium interest shall be applicable whenever the minimum balance reaches to equal or above the stated balance. 7 | Ray Cora Saving coat Far, Rout Opening hd nding Pavere388.) ABAY BANK S.C - CHARITABLE SAVING ACCOUNT PROCEDURE 2.1.3 INTEREST RATE AND PAYMENT A. The prevailing default saving interest rate plus 1% will be computed on minimum deposit balance in the account per annum. B._ The bank can negotiate & increase the interest rate if customers want to make significant amount of deposit channelling donations or other in local or FCY: Interest calculation is made on monthly bases and the accrued interest is transferred to the charity receiving organization monthly bases too as far as the balance on the “Chartable Saving Account” is above Birr 60,000.00 and Birr 100,000.00 for individual and organization respectively. D. Customers can choose either of the available two ways of donating the interest based on their preference: = Donating the 1% marginal premium interest above the prevailing default interest accrued on their deposit or ‘= The whole premium interest accrued balance (interest calculated based on the prevailing default interest rate plus 1%) as desired by the customer. E. The required minimum deposit amount (i.e. Birr 60,000.00 or Birr 100,000.00} should be deposited at least for a period of one year to be entitled to the premium interest privilege and will be set in a blocked amount limit; F. In case the account holder withdraws below 60,000.00 or 100,000.00 for individual and organization respectively; before one year time, all the interest amount transferred to the charity organization up to point of withdrawals will be computed and deducted from the requested withdrawal amount and recorded as income but will get interest payment based on default interest rate. G. The charity receiving account will also be entitled to the privileged prevailing default saving interest rate plus 1% as far as the balance maintained in the account is above Birr 100,000.00 which helps the bank make charity through extra (19%) interest payment. H. The premium interest privilege is always set for a year time which may continue or set to default interest rate based on assessment of conditions and decision of the Bank’s top management. & | Abay- Charitable Saving Account Feature, Account Opening And Handling Procedure“a Nee ) ABAY BANK S.C - CHARITABLE SAVING ACCOUNT PROCEDURE 23.2 REQUIRED DOCUMENTS Since this procedure is an integral part the Bank's Main Retail Banking Procedure, the KYC Principle & all procedures indicated on the Retail Banking Procedure and Document requirements for: Account Opening, ‘Customer Creation and duties and responsibilities of all performers equally apply to “Charitable Saving Accounts” & remain in intact. Moreover, the following shall be considered in opening such accounts in addition to requirements stated on the main retail banking procedure: a) An account opening form specially designed for opening “Charitable Saving Account” shall be duly filled and signed by the customer along with the term and conditions thereon. b) The means of supporting charity organization shall be specified (If Possible}. ¢} Letter from a charitable organization and government organization authorized to certify such charitable organization shall be presented if the account is going to be opened by another charitable organization. d) Certificate or letter from authorized government body shalll be presented by a charity society organized as an entity for which the interest accrued is going to be transferred in the form of charity or donation. €) The donation receiving Charity association, shall present a Memorandum and Article of Association attested, registered & sealed by the concerned Federal or Regional Offices; and f] A letter of request to open and operate the account shall be presented, which should be signed by the authorized person mentioned in the Memorandum/Article of Association and shall bears the company’s official stamp; AE J 10 | Abay= Charitable Saving Account Feature, Account i Proce(SB) ABAY BANK'S, - CHARITABLE SAVING ACCOUNT PROCEDURE, 2.4 ACCOUNT OPENING All account opening procedures which have been described in the Main Retail banking procedure shall be applied up on opening charitable Saving Account. Thus, account Opening phases, Customer Creation and duties and responsibilities of all performers stated on the main retail Banking procedure also apply while opening “Charitable Saving Accounts” (Both Donating and Receiving) and remain in intact. Moreover, the individual or organization applying to open account should not appear on the IFC, OFAC & other sanction lists. In general, features common to opening saving accounts are applied. However, the account class/type code on the core banking system thjat to be selected for “Charitable Saving Account’ is “SACHR”. 2.4.1 CUSTOMER CREATION Customer Creation in the core-banking system for “Charitable Saving Account’ will be the same as other saving account procedure described on the retail Banking procedure; however, upon inserting basic information on the customer screen, the account type/code shall be selected as “SACHR™ which represent Charitable Saving Account. After inserting basic information about a customer the account shalll also be er-marked after the account name as A. ‘Charitable = Donation” : if the account is opened by an individual or ‘organization who want to donate and give charity of the interest accrued in the account to a charitable organization in need of support and donation. Or B. “Charitable - Charity Receiving: if the account is going to be opened to an organization which will receive charity or donation from a “Charitable Saving Account” Of ae yil= [ABAY BANK S.C. - CHARITABLE SAVING ACCOUNT PROCEDURE 2.4.2ACCOUNT OPENING PROCEDURE Duties and fesponsibilities of all performers stipulated on the main retail banking procedure also apply while opening “Charitable Saving Donation/Receiving” account and remain in intact. In addition the following shalll be given due attention: A. Client Relations Officer (CRO) : iv. Explains and cross sell the new “Charitable Saving Account “ to potential customers while providing the usual banking services. Ascertains whether the applicant maintains an account in other branches so as to stick and use only one CIF for the customer. Check the individuals name against sanction lists. Select account class/Type code “SACHR” on the system. B. Supervisor (Branch Managers, Assistant. Branch — Managers, Senior/Accountants/Officer or their designates) i C. Branch Controller (Junior, controller or se i [2 | Abay- Charitable Saving Account Feature, ete ling Procedu Shall Check and ascertain that the criteria and documents pertaining to “Charitable Saving Account” are fulfilled and properly presented Shall ascertain that all related data and information for Charitable Saving Account are as per procedure and inserted properly in to the system Shall approve the opening ascertaining it is in an orderly manner & forward documents to branch controller or accountant as appropriate, r] Or The Accountant Check & ascertain that that the account is opened in line with the procedure & necessary documents are correctly presented & processed. Shall check & assures that, the data & information maintained in the system are correct & same with evidences presented by the customer. Ascertain that, the term and conditions pertaining to “Charitable Saving Accounts” are duly signed by the customer. Shall ascertain and assures that; the account class code for Charitable Saving Account (SACHR) is properly selected and maintained. Shall periodically check & ascertain that interests on Charitable Accounts are properly computed & appropriately credits to the beneficiary. HW ..Gia) ABAY BANK S.C. - CHARITABLE SAVING ACCOUNT PROCEDURE 2.5 DEPOSIT 2.5.1 Deposit to "Charitable Saving Accounts” can be made either by the account holder or anybody who wants to support the scheme as far as he/she has come up with the pass book or account number. 2.5.2. Deposit can be made in another branch other than the branch where the account is maintained through inter-branch transaction. 2.5.3 Deposit can be made by cheque, CPO, or cash transfer letter through clearance from other bank and there is no limit for the amount of deposit. 2.5.4 Any deposit should be against receipt (Deposit advice), which is stamped and initialled by the receiving Client Relation Officer. 2.5.5 Pass book may not be necessary presented for deposit by the account holder or third party as far as he/she has come up with the account number which shall be attached with the deposit voucher and filed for future reference. 2.6 WITHDRAWALS (PAYMENT FROM “SACHR” (DONATION OR RECEIVING) 2.6.1 Withdrawal from both “Charitable Saving Account” (Donation or Receiving account] can be made up to the minimum deposit balance of Birr 60,000 & Birr 100,000 for individuals & organizations respectively which otherwise result in formfitting the premium interest. 2.6.2 Fund transfer from Charity Saving Account to other normal account is encouraged, unless the case is accepted by the branch manager. 2.6.3 In principle, withdrawal is not allowed to account holders without presentation of pass-book, however, if customer is already known or presented renewed 1D with a convincing reason, the branch can allow withdrawal up on approval of the branch manager for an amount not exceeding Br. 15,000.00 with careful scrutiny of particulars and photos. i Account Feature, Account Opening —— | on = 4}) ease) eye. vyaie) ABAY BANK S.C. - CHARITABLE SAVING ACCOUNT PROCEDURE. 2.7 CLOSURE OF AN ACCOUNT Account closure procedure for both types of “Charitable interest Trust Fund Saving Accounts” account will follow procedural steps indicated on the main Retail Banking Procedure, however, the reason for the closure can be 2.7.1 Request by Charity Donating party and same consent of charity receiving person or association and the vice versa 27.2 When any of the account customer reports loss of passbook: 2.7.3 When there is a court order for closure of such accounts; 2.7.4 Asa result of death, bankruptcy, insanity, etc. of account holders; In such instances the following shall be followed: i. The usual interview why parties are going to close the account shall be requested and as far as possible the customers shall be convinced to retain the account and continue the relationship. ii, If the account is being closed due to dissatisfaction or misunderstanding encountered by the customer, measure must be taken immediately to correct the irregularity created on the part of the Branch and retain the customer, If closing the account is must, the pass book provided to the customer must be collected; the balance should be updated if there is any difference due to interest calculation examining the initial agreement. iv. Supervisors shall Makes sure that interest calculation & payments are made as per the initial agreement & as per the procedure Vv. The Branch Controller or accountant shall receive and ascertain that the account transfer, interest and payments are in line with initial agreement and as dictated in this procedure. vi. Close the account following the usual account closing procedure indicated on the main Retail Banking Procedure. 14 Ser Sa he eer ee eae aS| CB pony want sc -CHARITABLE SAVING ACCOUNT PROCEDURE 3 EXCEPTIONS All exceptions to this procedure shall be approved by the President. 4 REVISION OF THE PROCEDURE This “Charitable Saving Account Procedure” shall be revised every three years. However, it can be revised when deemed necessary and if a need rises at any time. 5 EFFECTIVE DATE This procedure shall come in to force as approved by the Bank's Executive Management Committee and from the date signed by President of the Bank as indicated below: once Alesis a——~\ President Signature:<>) ABAY BANK S.C. - CHARITABLE SAVING ACCOUNT PROCEDURE. ANNEXES Os sakPhoto CHARITABLE SAVING ACCOUNT P04 ALGAE kend LON ‘Account Opening Application Form PLAN ooh sF eran FO ‘Account Number: Puna dene PRIDANT ae 9% Full mameName of Business Anamhaainarb asc. ‘Address meer aah House No. Telephone number tomes rac dere 19+ 1D Passport No. Place of tue Pre AL ae aah hewn noo once UL Sibert a ‘Tradefiv License No. TINO, Intl deposit acre 10, 1 — Monthly income (Fhnown) Nationality en nome mann — 2] [Name of Business Charitable Organization “Ta be donated by the Bank aeernoa neh RE vee +04. ‘Address Zone Bcity Wereds Kebele Fans an PM — mere wns (Additional) 1% — ] Interest Donation reference ‘v4-1 @H8 (Al Premium Interest) [—] Iu Me Ramio. ge2IF AHHATE MOM OMe? NIMAVEATEHIMAY NHTrHeM. MAAN DC HEH AMLRLA orang SMPOCNC NOTEAT emda UT owe - hme aE HOUSE VAL IMGGOIMAT: WHAT 2C (EERE SPY LOE APF NALNHIND MoI FAU NOSE We confirm that the info Fablty Formal operaio tation given herein above is correct and true. | ame are alo filly aware ofthe criminal and civil ‘accounts, Ijwe have also read and agreed the Term and Conditions related with the scxoun OMT an eeueremnD. aw. 4001 5006 Operated by Specimen signature rhe vec _ Opened BY a