109 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED | CONSOLIDATED ANNUAL REPORT 2022 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED Notes to the Consolidated Financial Statements For the year ended March 31, 2022 (Expressed in Barbados dollars) 78 25. Financial Risk Management, continued 25.2 Credit risk, continued The Group assigned probabilities and related weights based on the most likely forecasted economic outlook for the period under assessment. This probability is multiplied by a multiplier factor based on management’s professional judgement to derive the adjustment required to incorporate the forwardlooking estimate. Since Barbados received a stable outlook for the period under assessment by Moody’s and the Central Bank of Barbados, the base case scenario was the most likely scenario. Out of the sensitivity analysis of nine forecasted states, a forward-looking adjustment of 4% was applied as at March 31, 2022. Exposure to credit risk before collateral held or other credit enhancements The Group limits its exposure to credit risk by investing only in entities that have high credit ratings and Government of Barbados securities. Government securities are invested over a longer period than term deposits with other financial institutions which typically mature within one year. The Group has invested in FVOCI equity instruments as well, which gives it an opportunity to monitor the performance of these companies over time and make economic decisions where warranted. The Group has documented investment policies in place, which guide the management of credit risk on investments. Maximum exposure Credit risk exposures relating to on-balance sheet assets are as follows: 2022 2021 Loans and advances to customers: Consumer $ 737,685,263 724,716,089 Mortgages 625,540,010 555,229,124 Business 25,340,966 38,783,150 Financial investments: Amortized cost 28,134,472 27,813,739 Cash resources 408,398,711 381,844,691 Credit risk exposures relating to off-balance sheet items are as follows: Loan commitments 128,327,216 142,777,239 Total maximum exposure $ 1,953,426,638 1,871,164,032 The table represents the maximum credit risk exposure of the Group as of March 31, 2022 and March 31, 2021, without taking account of any collateral held or other credit enhancements attached. For on-balance sheet assets, the exposures set out above are based on net carrying amounts as reported in the consolidated statement of financial position.
RkJQdWJsaXNoZXIy MTA2MDM=