BARBADOS PUBLIC WORKERS' CO-OPERATIVE CREDIT UNION LIMITED
Notes to the Non-consolidated Financial Statements
For the year ended March 31, 2013
(Expressed in Barbados dollars)
43
24. Financial Risk Management…(continued)
Market risk
Market risk is the risk that the fair value or future cash flows of financial instruments will fluctuate due
to changes in market variables such as interest rates, foreign exchange rates and equity prices. The
Credit Union is mainly exposed to interest rate risk. The Credit Union’s exposure to currency risk is
minimal since it does not have any significant foreign currency denominated assets.
Interest rate risk
Interest rate risk is the risk of loss from the fluctuations in the future cash flows or fair values of
financial instruments because of a change in market interest rates. It arises when there is a mismatch
between interest-bearing assets and interest-bearing liabilities, which are subject to interest rate
adjustments, within a specified period. It can be reflected as a loss of future net interest income and/or
a loss of current market values.
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BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED
ANNUAL REPORT 2013
