Consolidated Annual Report 2015

13 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED CONSOLIDATED ANNUAL REPORT 2015 Further, initiatives were undertaken during the year to leverage Barbados’ advantage in international business and this is expected to bear fruits in the near future. The average unemployment rate stood at 12.5 percent, an increase of 1.3 percent. Additionally, net public sector debt to GDP was estimated at 73 percent compared to 67 percent a year earlier. Economic Outlook Despite modest growth in 2014, the Central Bank projected economic growth of 2 percent in 2015 and 2.3 percent in 2016. This growth is expected to come from tourism and construction activities which is expected to produce a spin-off effect in wholesale, retail and business services. Further, the Central Bank anticipates a reduction in the GDP’s deficit by 5 percent once the new revenue measures are implemented in 2015/2016 and current revenue measures are extended. Consolidated Financial Statement Highlights Revenues For the financial year ended March 31, 2015 the Group earned total interest revenue of $80.9 million, up from $77.9 million for the previous year. This represented an increase of $3.0 million or 3.9 percent for the year and is attributable to the steady growth in both consumer and mortgage loans across the Group. Income generated from non-interest sources increased by $284 thousand or 8.2 percent when compared with the previous year, primarily as a result of increased efforts in bad loan recoveries. Net interest Income Despite competitive pressures in lowering lending rates, prudent management of the interest spread resulted in consistent growth in net interest income during the year. Net interest income grew by $1.0 million or 2.1 percent to $49.8 million for the year, as a result of increased loan volumes and a reduction in funding costs. Net Income The Group earned comprehensive income of $10.3 million for the year ended March 31, 2015 compared with $10.8 million for the previous year. This represented a decline of approximately $580 thousand or 5.4 percent under the prior year. Operating Expenses Operating expenses increased from $36.1 million at March 31, 2014 to $39.8 million for 2015 and was driven principally by the new tax on assets, increases in staff costs, rental expense and security services. The increase in staff costs amounted to $1.0 million and is due to contractual salary increases and new hires in both the Credit Union and Capita during the year. The expansion of the Emerald City Branch, installation of two additional ATMs and the rental of office space for staff of Capita and the Credit Union during the year were responsible for the notable increase in rental expense. A full year’s rent would have been recorded during the year compared to a partial booking in the last quarter of 2014. As a consequence, total rental costs moved from $1.0 million in 2014 to $1.4 million for 2015. Assets Total assets of the Group stood at $1.1 billion at March 31, 2015. This represented an increase of $73.6 million or 7.2 percent over the previous year. At March 31, 2015, the Group’s consolidated net loans and advances rose to $906.1 million, as compared to $825.1 million at the end of March 31, 2014. This represented an overall increase of $80.9 million or 9.8 percent growth in loans compared to an increase of $50.5 million one year ago. 0 200000 2011 2012 2013 2014 2015 In 0 2000 4000 6000 8000 10000 12000 14000 2011 2012 2013 2014 2015 6,052 9,424 13,126 11,347 11,381 In BD$'000 Net Income MANAGEMENT DISCUSSION AND ANALYSIS (continued) 0 200000 400000 600000 800000 1000000 1200000 2011 2012 2013 2014 2015 842,307 906,565 951,285 1,017,049 1,090,678 In BD$'000 Total assets 6000 8000 10000 12000 14000 6,052 9,424 13,126 11,347 11,381 In BD$'000 Net Income