BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED
NON-CONSOLIDATED ANNUAL REPORT 2016
11
MANAGEMENT DISCUSSION AND ANALYSIS
percent with respect to interest from loans, while interest from
cash deposits and investments decreased by $165.3 thousand
or 4.5 percent during the financial year.
OTHER INCOME
Other income increased by $982.4 thousand or 38.3 percent
during the financial year mainly due to an increase of $639.1
thousand or 161.4 percent in the collection of charged-off
loans.
EFFICIENCY AND EXPENSE MANAGEMENT
The Credit Union’s strategy during the financial year was one
which focused heavily on efficiency and expense management,
while at the same time adding valued member services.
Operating expenses decreased by $327.4 thousand or 1.9
percent compared to prior year.
OPERATING LEASES
Rent expenses increased from $753.1 thousand in 2015 to
$870.7 thousand in 2016. This increase was directly attributed
to the expansion of the Credit Union’s branch operations at the
Six Roads location, installation of two additional offsite ATMs
and rental of office space for staff located at the Co-operators
General Insurance’s building at Collymore Rock.
STAFF COST
During the year, the Credit Union increased its staff
complement to strengthen its member services, compliance
and risk management functions as well as providing adequate
frontline and support personnel.
Additionally, completed union negotiated salary increases
contributed to the increased staff costs by $2.2 million or 17.5
percent over the prior year.
TOTAL OPERATING EXPENSES
Total operating expenses for the year amounted to $36.7
million, which represented an increase of $3.0 million or 8.8
percent above the prior year. Asset Tax expense levied by the
government on the assets of the Credit Union totaled $1.9
million or 0.2 percent. This Tax is scheduled to end effective
March 31, 2016.
NET OPERATING INCOME
Operating income net of loan impairment expenses increased
by $6.9 million or 16.0 percent to end the year at $50.2 million.
Loan impairment expense was $3.8 million, a marginal increase
of $77.2 thousand or 2.1 percent over last year.
ASSETS
At the end of the financial year, the Credit Union’s total assets
amounted to just over $1.0 billion, an increase of $90.0 million
or 9.7 percent.
Cash resources increased by $8.4 million or 8.9 percent. In
addition, financial investments classified as Held-to-maturity
increased by $3.2 million or 12.5 percent.
Net loans and advances to members were $817.8 million,
inclusive of an impairment provision of $20.5 million, as
compared to $746.5 million and $21.9 million respectively at
the end of the previous year.
ASSET QUALITY
Amid a climate of economic uncertainty and high
unemployment, the Credit Union recorded a decrease of 0.4
percent in its delinquency ratio which ended the year at 6.3
percent compared to the prior year at 6.7 percent.
