National Bonds Corporation, a Shariah-compliant savings scheme, on Saturday announced a profit rate of up to 1.5 per cent for 2012, lower than what it had announced for 2011.
For 2011, the company had announced a profit rate of up to 2 per cent. In 2010, the profit rate was 3.78 per cent while in 2009 it was 3.54 per cent.
The company said the annualised returns were, however, 2.62 per cent, which comprise a profit rate of up to 1.5 per cent (lowest since its inception in 2006) and earnings through 501,032 prizes and incentives equaling 1.12 per cent distributed through 2012 from its own funds.
The number of bondholder rose to 690,000 in 2012, registering an increase of 5.78 per cent compared to 2011. The company said that it has nearly 10 per cent of the UAE residents from over 200 nationalities investing in its bonds.
Female bondholders saw a healthy increase of nine per cent during 2012 with a 10 per cent increase in the average holding period of its customer accounts.
Bondholders, however, are not happy with the low profit rate.
S. Shah, a bondholder since 2008, said: "I do understand that they (National Bonds) announced a lower profit rate in 2011 since the world economy was in doldrums. But, in 2012, the market was good. I was expecting them to announce profit better than 2011. I am not at all happy."
Micheal J, another bondholder, added: "I was won a few times prizes of Dh50, but that doesn't help. I was hoping that the profit rate would be better, but I am disappointment. Since there is no other investment avenues for small investors such as mutual funds, I do save in this scheme due to the liquidity it offers."
119 millionaires to date
According to National Bonds, it has made 119 millionaires through its rewards programme and has awarded 1.8 million prizes to date for bondholders worth over Dh350 million.
Al Ali added: "I cannot emphasize enough how essential it is for individuals and families to recognize that the amount of money earned does not make a meaningful difference unless part of it is saved for the proverbial rainy day. The importance of planning financially for the future has been proven throughout history in the form of crises such as international disputes and economic downturns. I call upon all segments of society to act immediately to start saving before it's too late."
National Bonds is licensed and regulated by the UAE Central Bank. Minors can own bonds, provided they are purchased by their parent/guardian. Each bond costs Dh10 and the minimum purchase is Dh100.
© Emirates 24|7 2013
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