BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED
CONSOLIDATED ANNUAL REPORT 2015
14
The Credit Union led the growth in the mortgage loan portfolio
which accounted for approximately $18.3 million in mortgages.
Consumer loans were the major instrument of loan growth at
the Credit Union accounting for $44.3 million of the portfolio
increase.
This increase resulted from a more targeted marketing approach,
innovative loan promotions and from continuous streamlining of
the loan approval and disbursement processes.
These initiatives enabled the sustainment of the increasing loan
trend realized across the Group.
The Group remained highly liquid with total cash resources
totaling $108.8 million. Financial investments increased by $5.3
million or 20.6 percent due largely to additional purchases of
government securities during the financial year.
Asset Quality
The delinquency ratio increased slightly from 6.7 percent in 2014
to 6.8 percent at March 31, 2015. This is commendable given
the current environment and is attributable to close monitoring
of delinquent accounts, creating payment solutions for members
who are experiencing challenges and strict adherence to credit
control and underwriting requirements.
The Group also maintained a consistent approach to the
provisioning process based on thorough reviews of individual
credits and analyses of collective portfolio risk characteristics.
A key focus of management in recent months has involved
working proactively with members and customers to offer
financial counseling and provide alternatives to current loan
arrangements with the aim of maintaining sound credit ratings
and risk profiles.
Liabilities
The Group’s strong liquidity position continued to be driven by
the growth in deposit liabilities. At the financial year end, the
Group’s deposits totaled $915.3 million, an increase of $76.3
million or 9.1 percent higher than at the previous year-end.
Deposits at the Credit Union grew by $53.3 million or 7.4 percent,
while Capita continued to reflect a steady increase in customer
deposits which increased by $23.1 million or 16.9 percent.
0
200000
400000
600000
800000
1000000
2011
2012
2013
2014
2015
712,623 749,729 774,615 825,149
906,060
In BD$'000
Loans and advances
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
During the year under review the Credit Union repaid two high
interest rate loan facilities so as to reduce its debt service costs
and improve the overall net interest margin yield.
The Credit Union’s total loan repayment amounted to $10.2
million and was largely responsible for the reduction in loans
payable from $64.0 million at March 31, 2014 to $52.0 million
at March 31, 2015.
Equity
As at March 31, 2015, the Group’s total equity was $105.4
million, an increase of $8.8 million or 9.2 percent over the
previous year. The increase was primarily due to increased
profits of $10.3 million and growth in Credit Union share
capital of $0.5 million, net of dividend distributions of $2.0
million, paid to Credit Union members during the year.
The Group’s capital adequacy ratios are above minimum
capital requirements. These are continuously monitored when
assessing capital needs and evaluating changes in strategic
focus, risk tolerance levels, business plans and the operating
environment that might materially affect capital adequacy.
OUTLOOK – 2015 and Beyond
In the financial market, innovation is no longer incremental but
more exponential. The most remarkable advances have been
in the way in which products and services are delivered and
utilised.
These innovations are not driven by the financial industry, but
by technology pioneers such as Apple and Google. Thus as
mobile devices advance, so too do the applications for nearly
every industry, including finance.
In the past few months, we have seen major innovations in
mobile biometric security protocols and wearable devices, uses
which are already making their way into the banking sphere.
The key to our success is to position the Group to capitalize on
such innovations.
MANAGEMENT DISCUSSION AND ANALYSIS
