20 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED Board of Directors’ Report Overview The Governor of the Central Bank of Barbados in his first quarterly review of April 26, 2023 used a theme The Economy has Recovered which articulated macro-economic growth buttressed by what was cited in the review as the economy having recovered from the COVID slump Should the stated assumptions and forecasts run consistent to expectations, this positive news, and the trickle-down impact that is anticipated from both the economic growth and the post-COVID recovery, augurs well for the economy, Barbados and all Barbadians The Governor’s future looking statements predict what is expected to be the case in the coming year and beyond Conversely, as we reflect and report on our past fiscal period, we do so bearing in mind the predictions we made when we stood before you as a board at our AGM in December 2022 These predictions envisaged improved macro-economic conditions and a climate that would allow for increased membership participation, and it was against this backdrop that we set some ambitious budgetary goals; goals underpinned by an anticipated expansion of our membership base and a related improvement in loan activity through increased uptake of our financing products We acknowledge that there is a desire for low-interest rate loans and higher than average interest-rate deposit products, and that this is likely to continue as Barbadians seek to protect their disposable incomes We remain focused on delivering value-added membership, but can only do so to the extent that our actions allow us to maintain the financial strength and stability of our Credit Union, especially in these uncertain times It is imperative that we maintain healthy levels of capital, particularly through the generation of adequate levels of surplus which is our primary vehicle for doing so The principal risks and challenges that could prevent us from doing so are members’ loan defaults, a disproportionate imbalance of investments to member lending and the disparity in interest income as a result, and the liquidity challenges that could arise if overall operations are not properly managed Cognisant of the negative impact of these risks on achieving our set objectives, you are assured that they are monitored and managed by the Board to ensure your Credit Union is secure We are grateful that life has returned to mostly normal patterns following a year of heightened unpredictability It is clear however that this new normalcy is still not aligned with the previous norm, as other events unfolded that impacted the world as we know it and by extension influenced our local markets and the lives of our members The economic effects of the war in the Ukraine, the sluggish recovery and fallout from the COVID-19 pandemic, and even the separation of Britain from the European Union will continue for a number of years and will impact our local economic circumstances, particularly through rising inflationary pressures This rising inflation and the resultant increases in the cost-of-living are a reality felt by us all We are acutely aware of the impact these issues are having on our membership and will work with you as best as we can through this difficult period when inflationary pressures continue to erode your purchasing power “ We are proud of what we have accomplished from an operational, member service and community perspective
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