BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED
CONSOLIDATED ANNUAL REPORT 2015
12
5.0 percent to 4.7 percent as various pricing strategies were
employed to drive loan and deposit volumes.
These results were the product of outstanding and dedicated
staff. The Group expects a great deal from all of its employees.
They must have deep and broad knowledge of its products,
services, and systems. They must be accurate, efficient, and
compliant. Above all, they must deliver outstanding service
with every single interaction.
Outlook
Undoubtedly, the Group continues to operate in a challenging
economic environment that is already impacting on the
sustainability and future growth of key players in the financial
services sector especially the smaller Credit Unions. Faced with
continuing deterioration in credit quality, there is a constant
need to reassess capital levels, identify stress points and
manage risk exposures.
The Group will continue to respond to the current and future
challenges as it seeks to maintain its positive growth trends.
The impact of large-scale retrenchment of employees in the
public service and the introduction of a 0.2 percent tax on
assets of non-bank financial institutions have taken effect
during the financial year and will continue to do so in the 2016
financial year.
Notwithstanding these circumstances, the Group is well
equipped to whether the challenges which lie ahead.
Economic Review
The local economy continues to struggle as it seeks to recover
from extended periods of negative growth, despite some
growth globally.
According to the most recent economic report, the Barbados
economy is estimated to have grown by less than 1 percent
in 2014. Foreign exchange reserves at the end of December
2014 represented 14.5 weeks of import of goods and services.
Tourism value-added is estimated to have increased by 1
percent thereby reversing a downward trend over the last 3
years.
MANAGEMENT DISCUSSION AND ANALYSIS
This section of the Group’s Annual Report provides a discussion
and analysis of the financial condition and performance of
the consolidated operations of the Barbados Public Workers’
Co-operative Credit Union Limited, and its subsidiaries (“the
Group”) for the financial year ended March 31, 2015.
The Group includes the parent, Barbados Public Worker’s Co-
operative Credit Union Limited, its subsidiary BPW Financial
Holdings Inc. and its subsidiary Capita Financial Services Inc.
(“Capita”).
Overview
At March 31, 2015 the total consolidated assets of the Group
reached $1.1 billion reflecting an average growth of $6.1
million a month during the year ending March 31, 2015.
This growth epitomized the confidence, loyalty and support in
which members and customers have placed in the respective
boards, management and staff of the companies within the
Group.
Snapshot of CAPITA’s Performance
CAPITA has continued to grow from strength to strength since
its acquisition in August 2010, recording an average asset
growth of $1.8 million per year to reach $200 million at March
31, 2015. Its net income after tax has stabilized to average
$1.0 million per year. However, CAPITA continues to expand
offering a wide diversity of other income opportunities for the
Group.
One such opportunity is through the establishment of CAPITA
Insurance Brokers (CIB) which provides brokerage services to
the Group under the CAPITA brand.
Through CIB, the Credit Union’s membership has been provided
with one of the best health benefit plans within the market.
Group Performance Summary
The Group’s consolidated net income for the year under review
totalled $9.6 million compared to $11.1 million for the previous
year. Total tax levied on the assets of the Group for the year
ending March 31, 2015 amounted to $1.6 million.
The Group continued to maintain tight control over the rate of
non-performing loans. Although there was an increase in non-
performing loans by $6.1 million across the Group, the rate of
delinquency increased marginally to 6.8 percent.
A review of the loan portfolio required that the loan impairment
provision be increased by $0.6 million in 2015. However, the
ratio of provision to impaired loans moved from 40 percent in
2014 to 37.1 percent in 2015.
Overall the Group recorded significant growth in its core
businesses. Loan growth moved from 6.5 percent in 2014 to
9.8 percent in 2015.
Deposit growth climbed from 8.6 percent in 2014 to 9.1
percent in 2015. Net interest margin declined slightly from
0
200000
400000
600000
2011
2012
2013
2014
2015
In BD$'000
0
200000
400000
600000
800000
1000000
2011
2012
2013
2014
2015
673,773
735,909 772,320
839,052
915,312
In BD$'000
Deposits
