21 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED | CONSOLIDATED ANNUAL REPORT 2021 will be continued in the current fiscal. Looking back at the past year, we are proud of what we have accomplished from an operational, member service and community perspective. Through adherence to our co-operative values we were able to provide the support our membership required, when they required it most. Financial Performance The impact of the COVID-19 virus on the local landscape and by extension the Credit Union’s financial performance is evidenced by the reduced surplus of $8.0 million, which represents a net profit margin of 9.6 percent for the 2020-21 financial year, compared to a surplus of $17.1 million and a net profit margin of 19.0 percent for the 2019-20 financial year. Asset growth for the 2020-21 financial year was recorded at 7.1 percent, with the Credit Union recording total assets of $1.58 billion, an increase of $104.5 million. With continued liquidity being experienced in the movement due to uncertainty and lower demand for credit, cash and cash equivalents grew to an ending position of $387.7 million, an increase of $92.8 million or 31.5 percent, while investments which were utilized as an alternative to the much more preferred loans and credit products changed to a total of $62.8 million, an increase of $7.8 million or 14.2 percent. Overall, as corroborated by the Central Bank of Barbados’ quarterly reviews, the appetite for new credit continues to be low. The report as at end of March 2020 details that new loans were 70% of 2019 levels, particularly driven by a decrease in the area of household debt which is a major line item for the Credit Union. It is against this backdrop that the overall loan portfolio registered a movement of $18.5 million as at the end of the past financial year. The specific details around the performance in this area, as well as the movement in other key related metrics such as the various income streams and delinquency are available in the financial highlights presentation and Credit Committee Report. The change in macro-economic conditions has resulted in an extremely competitive environment where there has been enhanced activity not only by the commercial banks and other regulated entities, but also significant encroachment by unregulated entities such as retailers, shadow banks and similar. The bold and predatory practices of these players continue to threaten market share and potentially erode members’ financial positions. We will continue assess and review our lending policies, procedures and general framework to minimize the need for members to go outside of the Credit Union to access financing. Subsidiary Performance The CAPITA Financial Services Group continues to perform admirably recording another year of significant performances at both the stand-alone, now referred to as separate, to ensure compliance with accounting standards, and the consolidated levels. CAPITA Financial Services Inc. achieved a final profit position of $1.9M with growth in the key area of net interest income. Total assets rose to $313M, a 1.6% increase over prior year with loans continuing to be the primary contributor at this time, positively growing to $275.5M. Likewise, CAPITA Insurance Brokers Inc. also had a laudable year with significant improvements being recorded in their final profit position. Commissions from business generated grew by 10.9% and helped the company to achieve its best performing year to date, positively contributing to the overall Group’s final position. The above performances notwithstanding, diversification of revenue streams continues to be a focus for CAPITA’s management. The previously reported ATM shared service initiative continues to be rolled out in the St. Lucia market with five (5) Credit Unions now actively utilizing the service which allows our Credit Union brothers and sisters to have CarIFslike access to Automated Teller Machines (ATMs). To date, the transactions have been to targeted levels and there has been positive acceptance and uptake by the St. Lucian members. In keeping with the electronic services being provided in the St. Lucia market space, CAPITA is also on the way to providing similar services locally, as the provider of processing services to local credit unions transitioning from the proprietary CarIFS environment to the new internationally branded MasterCard debit card environment. Work on this has progressed significantly for your Credit Union and your new card will be available for your collection and use during the course of the current financial year. This is a redefining moment for the company and one that builds a strong and diversified platform for future products and services to be built upon. It is of such significance that it is worthwhile to restate the sentiment expressed last year when we acknowledged that these types of projects not only underscore the long-term value of CAPITA to the sector and Group, but also underscores the importance and Sis. Kieva Cadogan presenting to an 11 Plus Awardee at the Thrift Club Awards Ceremony.