BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED
CONSOLIDATED ANNUAL REPORT 2016
42
BARBADOS PUBLIC WORKERS' CO-OPERATIVE CREDIT UNION LIMITED
Notes to the Consolidated Financial Statements
For the year ended March 31, 2016
(Expressed in Barbados dollars)
30
12. Loans and Advances,
continued
In October 2015, the subsidiary entered into a Deed of Sale and Administration agreement with the
Eastern Caribbean Home Mortgage Bank (ECHMB), wherein the subsidiary sold its rights to 100% of
the cash flows arising on a portfolio of loans amounting to $2,424,473. The agreement provides that
the subsidiary could repurchase and replace any loan included in the loan portfolio subject to the mutual
agreement of the parties. The subsidiary has determined that substantially all the risks and rewards of
the said loan portfolio have been retained by the subsidiary and consequently, the loans were not
derecognized. The subsidiary accounted for the transaction as collateralized borrowing and recorded
the cash received from such agreement as loans payable reported in the consolidated statement of
financial position (see Note 18).
Finance leases at March 31, 2016 amounted to $28,770 (2015 - $28,770).
A portfolio of mortgage loans of a subsidiary has been pledged as security for certain customer deposits
totalling $13,836,206 (2015 - $18,800,000). At March 31, 2016 a floating charge of $15,000,000
(2015 - $15,000,000) over these deposits had been formalised.
(ii) The movement in provision for impaired loans is as follows:
2016
Consumer
Business Mortgages
Total
Balance, beginning of year
$ 17,036,003
294,476 5,858,141 23,188,620
Amounts charged off
(5,202,888)
(35,988)
-
(5,238,876)
Loan impairment expense
4,521,870
(106,916)
(168,561)
4,246,393
Balance, end of year
$ 16,354,985
151,572 5,689,580 22,196,137
Individual impairment
$ 12,123,333
112,888 4,592,104 16,828,325
Collective impairment
4,231,652
38,684 1,097,476 5,367,812
$ 16,354,985
151,572 5,689,580 22,196,137
