Group Vision Statement . . . . . . . . . . . . . . . . 2 Group Values . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Training and Development . . . . . . . . . . . . . . 3 Our Leaders Board of Directors . . . . . . . . . . . . . . . . . . . . . . 4 Management Team . . . . . . . . . . . . . . . . . . . . . 5 Financial Highlights . . . . . . . . . . . . . . . . . . . . 6 Management Discussion & Analysis . . . . . . 8 Board of Directors’ Report . . . . . . . . . . . . . 16 Independent Auditors’ Report . . . . . . . . . . 32 Financial Statements 36 CONTENTS
2 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED
3 SEPARATE FINANCIAL STATEMENTS 2025 Training and Development 1. Team Development and Capability Building A key component of this transformation has been the training and development of staff. Notably: • STARS Customer Service Training was rolled out to all staff, ensuring a consistent and elevated service experience across all touchpoints. • Sales Training for Relationship Officers has equipped frontline teams with enhanced consultative skills to better meet member needs and drive value. • A continued focus has been placed on embedding training into daily operations, with team leaders reinforcing key principles through coaching, performance check-ins, and real-time feedback. This structured approach to capability development is supporting a culture of continuous improvement and accountability. 2. Recruitment and Workforce Alignment To support our evolving structure and service model: • Targeted recruitment has focused on filling critical skill gaps for front-facing roles for member engagement and operational services. • Recruitment processes are being realigned to ensure cultural and capability fit. • New hires are onboarded with a focus on our service standards and delivery, and strategic objectives. 3. Cultural Alignment and Change Management Organisational change has been supported by: • Increasing communication around our strategic goals and the purpose of the redesign. • Leadership alignment initiatives and staff engagement sessions to ensure clarity and buy-in. • A growing sense of shared ownership in achieving service excellence and delivering on member outcomes. Over the past year, the organisation has placed a strong emphasis on strengthening our team to support member growth, improve service delivery, and align with our long-term strategic goals. This has been a core part of our broader organisational redesign, which aims to build a highperforming, member-focused culture. 4. Job Evaluation The job evaluation exercise, as the last remaining component of the corporate redesign, remains on-going; however, the Group has made significant progress with discussions with its staff representative, the Barbados Workers Union and the office of the Chief Labour Officer. We remain committed to progress to as speedy a conclusion which results in the best possible outcome for all parties involved. 5. Rewards & Recognition During the fiscal we launched our THRIVE Rewards & Recognition Program and successfully selected our winners for Employee of the Quarter. Launched in July 2024, the program THRIVE was conceptualized specifically to demonstrate our appreciation for our over 300 employees who are the key to the Group’s success. BPW Group, in its commitment to the recognition of excellent performance and achievement in the Group; designed THRIVE to strategically support a culture where the demonstration of organizational values, extraordinary effort and results are recognized and rewarded. 6. Industrial & Employee Relations Update With the onboarding of the new Industrial Relations Manager, we are embedding a programme towards strengthening workplace harmony and employee engagement through proactive IR & ER practices such as union engagement, employee wellbeing, grievance management, compliance, and communication strategies. Employee Relations (ER) highlights included the annual employee engagement survey and enhancing feedback mechanisms with staff through the IR Manager. Recent training on Grievance Handling occurred for all managers and supervisors.
4 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED Our Leaders Meet the Board of Directors Board of Directors Bro. Mark Hope, President – B Sc , MBA, FCG, LLB, ACCD Dr. CarolineWoodroffe-Holder, Vice-President – BA - History (Hons), MEd - Educational Administration, MSc - Information and Library Science (Dist), EdD - Higher Educational Leadership Sis. Virginia I. Sandiford Garner, Secretary – CUNA Management Certificate, Cert Marketing, MBA Sis. Rochelle Belgrave, Treasurer – A S – Business Administration; B Sc – Management, Cert - Auditing 1 and Basic taxation; Cert Enterprise Risk Management; Cert Compliance Risk Management Bro. Gerard Prescod, Assistant Secretary – BA Political Science, MSc Labour & Employment Relations, Dip Security Administration, NEBOSH Cert Occupational Health & Safety, Cert Law for Human Resources, Cert Administrative Management Sis. Wendy Knight-Hunte, Director – BSM, J P Sis. Anne-Marie Burke Brewster, Director – MSc , J P Bro. Carl Padmore, Director – B Sc Fine Arts (Creative Arts) Hons ; Cert Corporate Governance Bro. Lindell Earle, Director – B Sc Management Studies, CGA, MBA, FCA President Bro. Mark Hope Vice-President Sis Caroline Woodroffe-Holder Secretary Sis. Virginia I. Sandiford-Garner Director Bro. Lindell Earle Director Bro. Gerard Prescod Director Bro. Carl Padmore Director Sis. Anne-Marie Burke Brewster Treasurer Sis. Rochelle Belgrave Director Sis. Wendy Knight-Hunte
5 SEPARATE FINANCIAL STATEMENTS 2025 Executive Management Team Bro. Glyne Harrison, Group Chief Executive Officer – BSc, MSc, MSc , CMA, CPA Sis. Jacqueline Caesar, Chief Human Resources Manager – MBA, BSc (Hons) Bro. LeVere Catlyn, Chief Financial Officer – MSc , CPA—CGA, CA, CCUE Bro. Irwin Gibson, Chief ICT Officer – BEng, MSc , MBA Sis. Natalie Holder, Chief Legal & Corporate Affairs Officer – LLB, LEC Sis. Harriett Franklin, Chief Operations Officer (ag ) – B Sc, Pg Dip, Trade Relations Bro. Eric Small, Chief Internal Auditor – BSc , CIA, CFE Sis. Gail Best-Niles, Chief Marketing & Member/Customer Experience Officer Meet the Executive Management Team Group Chief Executive Officer Bro. Glyne Harriison Chief Financial Officer Bro. LeVere Catlyn Chief Human Resources Officer Sis. Jacqueline Caesar Chief Information, Communications & Technology Officer Bro. Irwin Gibson Chief Operations Officer (ag.) Sis. Harriett Franklin Chief Legal & Corporate Affairs Officer Sis. Natalie Holder Chief Internal Auditor Bro. Eric Small Chief Marketing & Member/ Customer Experience Officer Sis. Gail Best-Niles
6 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED Financial Highlights Financial Highlights - Five Year Review In Bds $’000 2025 2024 2023 2022 2021 Statement of financial position: Assets Cash and equivalents 388,629 365,133 356,952 376,390 350,989 Investments 179,426 158,379 113,377 69,958 62,840 Loans to Members (net) 1,127,964 1,131,733 1,146,391 1,114,980 1,054,665 Property and Equipment 47,836 46,780 48,657 51,377 52,507 Other Assets 67,691 59,335 58,364 60,493 56,176 Total Assets 1,811,546 1,761,360 1,723,741 1,673,198 1,577,177 Liabilities and Owner’s Equity Liabilities Deposits 1,565,369 1,524,797 1,500,899 1,453,146 1,374,306 External Debt - - - - Other 49,083 41,708 34,153 35,658 29,705 Total liabilities 1,614,452 1,566,506 1,535,052 1,488,804 1,404,011 Equity Share Capital 13,986 13,651 13,334 12,901 12,357 Statutory & Other Reserves 176,300 175,199 170,439 166,742 156,436 Retained earnings 6,808 6,004 4,916 4,751 4,373 Total Equity 197,094 194,854 188,689 184,394 173,166 Total Liabilities and Owner’s Equity 1,811,546 1,761,360 1,723,741 1,673,198 1,577,177 Statement of income: Interest Income 86,573 87,099 88,928 86,601 83,591 Interest Expense 17,898 19,644 21,273 22,139 23,177 Net Interest Income 68,675 67,455 67,655 64,462 60,414 Other income 5,817 5,663 4,867 4,580 3,721 Net income and other income 74,492 73,118 72,522 69,042 64,135 Impairment expense 1,636 2,676 4,766 6,498 9,247 Net operating income 72,856 70,442 67,756 62,544 54,888 Total operating expenses 67,679 61,622 59,662 52,277 46,869 Net income before extra-ordinary items 5,177 8,820 8,094 10,267 8,019 Derecognition of Government Securities Reversal of Impairment on Investment in Subsidiary - 1,307 - Net Surplus 5,177 8,820 9,401 10,267 8,019
7 SEPARATE FINANCIAL STATEMENTS 2025 2025 2024 2023 2022 2021 Financial statistics in percent: Asset Growth 2.85 2.18 3.02 6.09 7.09 Loan Growth -0.33 -1.28 2.82 5.72 0.82 Deposit Growth 2.66 1.59 3.29 5.74 7.40 Net Surplus Growth -41.30 -6.18 -8.43 28.03 -53.08 Return on Assets 0.29 0.51 0.55 0.63 0.53 Return on Equity 2.64 4.60 5.04 5.74 4.69 Operating Efficiency 92.89 87.48 88.05 83.58 85.39 Net Interest Margin 3.84 3.87 3.98 3.97 3.96 2025 2024 2023 2022 2021 Other statistics Delinquency ratio (%) 13.3 14.8 13.8 13.5 13.5 # of members 117.3 113.8 111.1 107.5 103.0 # of employees # of branches 6 6 6 6 6 2025 2024 2023 2022 2021 Net income per member $44.13 $77.50 $84.61 $95.51 $77.85 Financial Highlights Financial Highlights - Five Year Review In Bds $’000 Principal Bankers Republic Bank (Barbados) Ltd. Auditors PricewaterhouseCoopers SRL Barbados
8 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED This section of the Annual Report provides a discussion and analysis of the financial position and performance of the Barbados Public Workers’ Co-operative Credit Union Limited (BPWCCUL) for the financial year ended March 31, 2025, as compared to the financial year ended March 31, 2024. The Management Discussion and Analysis (MD&A) should be read in conjunction with the audited financial statements, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”). Barbados’ Economic Performance 2025 Barbados demonstrated solid economic fundamentals during the first quarter of 2025 as reported by the Central Bank of Barbados. This period was marked by significant growth across several key sectors, improved fiscal operations, and a strengthened external position. These achievements highlight the resilience and strategic planning that continue to propel the nation forward amidst complex global economic dynamics. The economy experienced a real GDP growth rate of 2.6 percent, driven by robust performances in the tourism, business services, and construction sectors. Inflation reached a 12-month moving average of 0.9 percent, reflecting a decline during the quarter. Meanwhile, unemployment stood at 7.1 percent as of September 2024, indicating stability in the labour market. International reserves also increased notably by $194.6 million to reach $3.4 billion, providing 32.4 weeks of import cover. However, the current account deficit widened to $52.6 million, underscoring the challenges of managing external financial flows. Encouragingly, gross public sector debt reduced to 102.8 percent of GDP, demonstrating prudent fiscal management. A Summary break-down of Macro-economic Developments • The tourism industry significantly contributed to economic growth this quarter. Long-stay arrivals increased by 2.4 percent, driven by strong performances from the U.S. and European markets, which rose 13 percent and 13.9 percent respectively. Cruise tourism reached a record 385,468 in-transit passengers, up 37.1 percent. Hotel occupancy rose to 80.5 percent, and revenue per available room (RevPAR) surged 23.8 percent, highlighting sector vitality. Management Discussion & Analysis (MD&A) • In agriculture, root crop production increased 23.9 percent, despite a 9.1 percent decline in fruits and vegetables output fell by 9.1 percent, and a sharp 16.8percent drop in milk production declined sharply by 16.8 percent due to equipment issues. The manufacturing sector showed flat performance, with furniture production declines offset by food (up 3.8 percent) and beverage growth (up 9.9 percent). Construction grew 6.4 percent, supported by major private and public investments. • The labor market showed mixed trends; jobless claims decreased in January and February but rose in March due to hotel renovations. However, net job creation was 9,000, with tourism and construction as key employment growth drivers. • Barbados’ fiscal operations were noteworthy, with the primary surplus increasing to $662.8 million, or 4.6 percent of GDP, fueled by higher corporate taxes and controlled spending. The fiscal deficit narrowed to $87.1 million, just 0.6 percent of GDP, while capital expenditure rose significantly to $632.8 million, emphasising infrastructure and climate resilience projects. • Externally, the current account deficit widened due to higher imports and income outflows, although improved tourism receipts provided a positive offset. Merchandise trade saw imports grow by 13.3 percent, while exports declined by 2.6 percent. Financial Sector Developments The financial sector remained stable, marked by improved credit quality, high liquidity, and strong profitability,
9 SEPARATE FINANCIAL STATEMENTS 2025 as non-performing loans (NPLs) fell to 3.9 percent for banks, with deposits growing 2.5 percent, particularly foreign-currency deposits, which rose 19.1 percent. Barbados’ Economic Forecast Looking ahead, Barbados is projected to achieve GDP growth of 2.7 percent for the year, led by tourism, construction, and business services. Inflation estimates have been revised upward to a range of 1.7 percent to 3.5 percent, reflecting imported inflation pressures. International reserves are expected to increase modestly, while fiscal goals remain focused on maintaining surpluses and reducing debt. Despite the positive outlook, risks persist. U.S. tariff hikes and global trade tensions pose challenges to exports and tourism, emphasising the need for Barbados to diversify its tourism markets, strengthen food security, and enhance regional collaboration to build economic resilience. In conclusion, Barbados showcased a remarkable performance in Q1 2025, with growth driven by key sectors and improved fiscal discipline. Strategic investments in infrastructure, climate resilience, and economic diversification are fundamental to sustaining progress and mitigating the impact of external uncertainties. Overview Our priority at the Barbados Public Workers’ Cooperative Credit Union Ltd. is to offer best in class financial products and services, while also promoting the financial and social wellbeing of our members. We are dedicated to adding value through our products and delivering exceptional service and support. During the period, membership increased by 3,476 or 3.1 percent to reach 117,257. Consequently, there was new deposit generation of $10.7 million and 177 new loans to first-time members totalling $3.5 million. Memberrelated expenditures through educational grants and scholarship expenses rose by $51.7 thousand compared to the previous year; however, social outreach related expenditure fell by $112.7 thousand compared to the prior year. Review of Financial Performance Total Income And Net Income Total income comprising of interest from loans and advances, and interest from cash resources and investments which jointly combined was reported at $86.6 million, along with non-interest income of $5.8 million, together totalled $92.4 million for the year ended March 31, 2025, compared to $92.8 million in the prior year, a 0.4 percentage decrease. Net income for the year was reported at $5.2 million, a decline of $3.6 million or 41.3 percent when compared to the prior year. Net Interest Income Net interest income comprises interest earnings on assets, less interest expenses paid on lease liabilities and deposits (the cost of funds). Net interest income increased by $1.2 million or 1.8 percent at the end of the financial year, March 2025, when compared to the prior financial year, March 2024. This was mainly due to interest expenses declining by $1.7 million or 8.9 percent, which was more than the decrease in total interest income of $526 thousand or 0.6 percent when compared to the prior year. Outstanding NPLs and NPL Ratios NPLs by Sector 4.1 3.9 9.7 9.0 0.0 5.0 10.0 15.0 20.0 0 200 400 600 800 1,000 Mar-20 Dec-19 Jun-20 Sep-20 Mar-21 Dec-20 Jun-21 Sep-21 Mar-22 Dec-21 Jun-22 Sep-22 Mar-23 Dec-22 Jun-23 Sep-23 Mar-24 Dec-23 Jun-24 Sep-24 Mar-25 Dec-24 % $M 0 100 200 300 400 500 600 700 800 900 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Total NPLs NPL Ratio - Banks (RHS) NPL Ratio - Finance Companies (RHS) Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Sep-21 Dec-21 Mar-22 Jun-22 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 Sep-24 Dec-24 Mar-25 $M Other Distribution Construction Hotels and Restaurants Real Estate & Other Professional Services Individuals Source: Central Bank of Barbados KEY INDICATORS: January to March 2025 Real GDP Growth on1 Unemployment2 International Reserves 2.6 percent 0.9 percent 7.1 percent $3.4 billion Current Account t Primary Surplus (FY) Fiscal Balance (FY) Gross Public Sector Debt $52.6 million $662.8 million (4.6 percent of GDP) -$87.1 million (-0.6 percent of GDP) 102.8 percent of GDP D posits Net Income Loans to members 2 Delinquency Ratio
10 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED Other Income Other income increased by $154 thousand or 2.7 percent during the financial year to end at $5.8 million. This was primarily due to an improvement in legal income and bad debt recoveries, which increased by $437 thousand or 51.6 percent and $584 thousand or 49.6 percent, respectively. These increases were offset by negative movements in fee income, which declined by $811 thousand or 24.3 percent, rental income by $55 thousand or 33.0 percent, and dividend income by $100 thousand or 67.2 percent. Efficiency And Expense Management The Credit Union’s strategy during the financial year focused heavily on adding valued member services. This involved investing in expanded services, technological upgrades and enhancing member engagement initiatives. These improvements were aimed at strengthening member satisfaction and long-term loyalty, aligning with the organization’s mission to provide competitive member-focused financial solution. As a result of this strategic pivot operating expenses rose by $6 million or 9.8 percent over the prior year. This uptick in spending reflects the cost associated with service development, infrastructure upgrades and additional staffing and training to support the expanded offerings. However, while the enhancements aimed to drive longterm benefits, the short-term financial impact was evident in the Credit Union’s efficiency ratio, which increased from 87.5% in 2024 to 92.9% in 2025. Total Operating Expenses Total operating expenses for the year were reported at $67.7 million (2024 - $61.6 million), representing an increase of $6.0 million or 9.8 percent compared to the prior year. The increase in staff costs accounted for 56.3 percent of the increase in total operating expenditure. This was followed by other operating costs, which contributed 43.3 percent of the increase in total operating expenses. The breakdown of the key changes in Other operating expenses for 2025, with a comparison to the 2024 financial year, is outlined below: • Increases were recorded in the direct cost of services of $1.7 million or 44.8 percent, publicity and promotion of $1.4 million or 52.6 percent, office stationery and supplies of $245.8 thousand or 32.0 percent, and repairs and maintenance of $419.4 thousand or 6.5 percent. • Compensating reductions of $504.8 thousand or 21.2 percent were recorded in legal and professional fees, while security services, bank charges and social outreach expenses recorded decreases of $312.1 thousand or 14.3 percent, $412.4 thousand or 56.5 percent and $112.6 thousand or 49.7 percent respectively. Net Operating Income Net operating income increased by $2.4 million or 3.4 percent to end the year at $72.9 million. This was primarily attributed in part to a notable decrease in interest expense of $1.7 million or 8.9 percent. Another significant development was the decline in expected credit losses (ECL), which fell by $1 million— or 38.9%—as of March 2025. This improvement was largely driven by a $19.3 million (11.2%) reduction in non-performing loans, coupled with loan portfolios being assessed at discounted market values that exceeded their carrying amounts. Together, these factors contributed to a notable decrease in overall impairment losses, enhancing the Credit Union’s credit risk profile. Assets Asset growth of $50.2 million was recorded for the year ended March 31, 2025 and was above prior year’s growth of $37.6 million. The Credit Union’s assets have grown by $234.4 million or 14.9 percent over the last five years to reach $1.8 billion at March 2025. Net loans and advances to members were $1.128 billion, inclusive of the required allocation for expected credit losses which this year carried an overall ECL allowance of $35.9 million and interest receivable from loans of $10.5 million. This compares to $1.132 billion inclusive of an expected credit loss allowance of $39.6 million and interest receivables of $9.1 million at the end of the 2024 financial year. Net loans therefore, declined by $3.8 million or 0.3 percent over the prior year. Further analysis showed that increases in mortgage loans were the primary driver of loan growth, with net mortgages growing by $20.8 million (2024 - $21.7 million) Loans to members Total Assets 3 Total Assets Management Discussion & Analysis (MD&A) (Continued)
11 SEPARATE FINANCIAL STATEMENTS 2025 or 4.1 percent (2024 - 4.4 percent). However, the appetite for loans outside of mortgages continues to fall below expectations resulting in a decline in consumer loans of $25.4 million (2024- $37.0 million) or 4.2 percent (2024 - 5.7 percent) while business loans contracted by $580.9 thousand (2023 - $552.2 thousand) or 18.3 percent (2024 – 14.8 percent). Asset Quality Non-performing loans or stage 3 loans were $19.3 million or 11.2 percent lower than the prior year due to prudent delinquency management, compared to a decline in Gross Loans by $8.8 million or 0.8 percent. Combined, this contributed to the 1.5 percent decline in the delinquency ratio this financial year. Delinquent loans over 31 days (stages 2 & 3) decreased by $17.3 million or 8.7 percent, delinquent loans less than 31 days (stage 1) however, increased by $8.5 million or 0.9 percent. Given the cumulative impact of the movements, expected credit losses allowances in relation to loans decreased by $3.7 million or 9.3 percent to move from $39.6 million in 2024 to $35.9 million at March 31, 2025. The delinquency rate for the fiscal period moved from 14.8 percent to 13.3 percent at March 31, 2025. Liabilities The Credit Union’s operations continued to be funded solely by member deposits, which at March 31, 2025, totalled approximately $1.6 billion representing growth of $40.6 million (2024 - $23.9 million) or 2.7 percent (2024 – 1.6 percent). During the fiscal the average monthly deposit cost was $1.5 million as compared to the prior year of $1.6 million. The organization currently maintains a higher-thanmarket rate on its core deposits thus ensuring that its members receive a premium return on their savings compared to similar financial products in the market. This benefit to members was provided while balancing the need to remain competitive and ensuring the continued financial strength and stability for which we are known, both of which were achieved. Total Other Liabilities Total Other liabilities increased by $7.4 million (2024 – $7.5 million) or 17.7 percent (2024- 22.1 percent) to move from $41.7 million in 2024 to $49.1 million at March 31, 2025. Major contributors to this increase were increases in accounts payable and accrued expenses of $4.3 million or 70.1 percent and the amounts due to member estates (Reimbursable Shares) which increased by $5.3 million or 19.2 percent. Decreases were recorded in the fair value adjustment (benefit) relating to staff loans by $541.5 thousand or 20.2 percent, unallocated receipts to members, unprocessed bill and payroll payments arising out of timing differences decreased by $852.6 thousand or 21.7 percent over the prior year and finally, the lease liability by $762.6 thousand or 56.5 percent. Equity Total equity which comprises members’ share capital, retained earnings and statutory and other reserves provides a safety buffer, ensures financial stability and allows for future growth and development. As at March 31, 2025, total members’ equity stood at $197.1 million, up from $194.8 million as at March 31, 2024. The increase of $2.2 million or 1.1 percent was predominantly attributable to the growth in the statutory and other reserves, and enhanced by the growth in retained earnings by $804 thousand or 13.4 percent. Distributions to members during the year were approximately $3.7 million which comprised of a share dividend of $669.9 thousand or 5.0 percent and an interest rebate of $2.0 million or 2.5 percent. Deposits Net Income Loans to members 2 Asset Growth Delinquency Ratio Loans to members 1 Delinquency Ratio
12 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED Way Forward As we look to the future, it is clear that a return to normalcy in the financial services sector in which we operate is not as close as would wish. Persistent inflation and geopolitical uncertainties are creating economic headwinds globally, making it necessary for us to navigate these realities while managing the unique dynamics of our tourism-dependent economies, which are always impacted by such uncertainties, against an increasingly stringent and unforgiving regulatory regime. In such an environment, our steps forward cannot be reactive but must be deliberate and forward-thinking, anticipating those changes that may and will come our way. For the upcoming fiscal year and beyond, we must continue our ongoing initiatives to build a more resilient, agile, and member-centric Credit Union. We will continue to work on rolling out the various aspects of our digital transformation initiative that will initially provide the groundwork for members to access modern online and mobile services. As digital transformation gives way to digital maturity, it is our intention to leverage these same platforms to create even more intelligent and personalised member experiences. We have started and will continue to explore the integration of artificial intelligence and data analytics into our operations as we envision and pursue the creation of a Credit Union that automates routine processes, anticipates members’ financial needs, and offers proactive advice through the channels members find most aligned to their needs, consequently freeing up team members to engage in the complex, high-value conversations that build lasting relationships. In a world where data is our members’ most valuable asset, protecting it is has to be one of our biggest commitments and areas of focus, and we must continue to enhance our security infrastructure and framework; moving from a defensive posture to a proactive stance of cyber resilience. Our focus will be on continuing our current initiatives towards enhanced predictive threat intelligence roll-outs and enhancing our security architecture to get it to a level that is as robust and dynamic as the threats it is designed to counter. This is imperative as your confidence in our ability to safeguard Management Discussion & Analysis (MD&A) (Continued) SAVE TIME ! Apply Online Save time with our hassle-free online loan application. Apply now and enjoy the convenience of a streamlined process from the comfort of your own home. Don’t waste precious time waiting in line or dealing with paperwork. Experience the power of technology and apply online today! their information is critical to our future success. We will also strategically focus on meeting the generational needs of all of our membership demographics to ensure our long-term sustainability. We value the loyalty of our established members who have built this institution and who have supported us over the years. To honour their legacy, we must ensure our continuity and must actively attract and engage younger generations of members. This involves more than just digital channels; it also requires developing creative products that leverage their love of technology, creating relevant financial literacy programs, and communicating in ways that resonate with their generational aspirations. None of this will be possible without investment in our organisational culture and talent. Our people are the engine of our progress, and we are committed to providing them with the tools and environment they need to excel. To successfully execute these initiatives and achieve our plans, we must be an employer of choice, capable of attracting, developing, and retaining the best talent in a highly competitive market. Our intention is to foster a culture that is strongly anchored in the co-operative principles and ethos, where continuous learning, empowerment of our teams to allow them perform to their true potential, and accountability to the highest standards of performance by all becomes the common standard. Our cooperative principles are not relics of the past; they are the very compass that will guide us through to our desired future-state. By blending our foundational ethos of “people helping people” with a bold, forward-looking technologically-underpinned, but people-centric strategy, we are confident that we will continue to navigate any tests that lie ahead, and will emerge stronger, more efficient, and more deeply connected to the members and communities we are privileged to serve.
13 SEPARATE FINANCIAL STATEMENTS 2025
16 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED Board of Directors’ Report Credit Union Performance The period under review was a challenging one for the board and management. This was not only a result of the weighty worldwide economic fluctuations, ongoing economic instability, or the lowered growth rates signalled by both the IMF and the World Bank, but more so because of increased threats that are becoming more routine in the financial services sector such as cybersecurity attacks and incidents, heightened and more aggressive competition from banks and other non-bank lenders, rising regulatory burdens, and the continued and increased need for more expeditious digital transformation and enhanced talent management across the credit union. In a year that saw our usual level of surplus materially impacted by several abnormal and one-off matters, we acknowledge that we were adversely affected by: • Fraud losses arising out of a sophisticated BIN attack that resulted in the compromise of some of our Overview Throughout the past fiscal year our Credit Union, in line with its pivotal position within the Barbadian community, has continued to seek to bring about positive outcomes for both our members and dedicated employees. The core cooperative principles have remained the driving force behind all our endeavours, and have continued to shape our engagement with the community as will be showcased throughout this report. This period has been exceptionally dynamic with lots of unexpected and at time negatively impacting twists and turns, against which we take pride in the milestones we have reached. Building communities is one of our key principles. To do so, we strive to offer products with competitive or market leading rates that are delivered with the friendly expertise of staff who are happy to serve our approximately 120,000 members across the island. We extend our sincere gratitude for your ongoing support and reiterate our commitment to making a positive impact in our community as we look forward to the year ahead. “ We are proud of what we have accomplished from an operational, member service and community perspective. members’ Mastercard debit card • Increased expenses arising out of corporate redesign staff related costs • Lower than budgeted interest income from consumer loans • Loss of interest income driven by write-offs due to the fact that some of our core borrowing members had reduced jobs opportunities making it impossible at times to fulfil their financial obligations to the organisation. A review of the financial results of the year under review would show a lower than desired surplus, but normalising the organisation’s performance to account for the abnormal fraud and redesign costs that occurred during the year would show a recorded surplus from normal operations being 10% better than prior year. This is shown in the below table.
17 SEPARATE FINANCIAL STATEMENTS 2025 Metric (‘000) Current Year Previous Year % Change Net Surplus 5,177 8,820 -41.3% Abnormal Items Redesign Costs 3,207 - - BIN attack fraud 1,294 - - Net Surplus adjusted for abnormal items 9,678 8,820 9.7% The Treasurer’s Report and the audited financial statements will provide more detailed narrative of our financial performance, measures and metrics. Subsidiary Performance Capita Financial Services Inc. (CFSI) During the reporting period, CFSI’s key focused priorities were centred around the development of its five-year strategy plan, the introduction of a new suite of deposit products that are key to providing diversification of its funding sources, and reviewing and exploring ways to reduce delinquency and recover the current stock of nonperforming loans. Additionally, major emphasis was placed on the completion of a review of the company’s brand identity and the development of a more focused marketing strategy to target specific customer segments. While CFSI’s revenue and profitability positions continued to be impacted by increased market competition as other financial institutions offered lower interest rates on loans and higher yielding investments products, its 2024-25 net income position recorded a healthy 21.5% year on year growth finishing at just under $1 million. Operationally, work completed on fully reviewing the nonperforming loan book, resulted in significant write-back to provisions and a more defined recoveries process that will lay the foundation for fiscal year 2025/2026. Overall the company continues to maintain strong capital and favourable liquidity build-up, both of which are critical to our long-term goals. We look forward to sharing further successes with you in the coming years. Income Statement • Total interest income - $15.04 million • Total interest expense - $6.71 million • Total other income - $8.79million • Total expenses - $14.96 million • Net profit after taxes - $988.9 thousand Statement of Financial Position • Net loans and advances - $250.47 million • Total assets - $328.23 million • Total deposits - $255.68 million Allied Co-operators Inc. (ACI) During the reporting period, engagement of the smaller Credit Unions for services with ACI were considerably reduced and as a result, the Directors of ACI made the decision to reach out to the umbrella body with the view to developing ACI as a full credit union service organisation(CUSO). We are awaiting feedback from the wider sector with regard to how best a CUSO such as ACI would work to help those smaller credit unions manage areas of governance, compliance, data privacy and regulatory changes going forward. The Credit Union’s Board of Directors is of the firm belief that ACI operating as a CUSO is a benefit for smaller Credit Unions given the current regulatory environment, but is also prepared to make a decision pertaining to ACI that is in the best interest of the Barbados Public Workers’ Group of Companies should this become a protracted matter. Legacy Foundation Legacy Foundation continues to serve as a key channel for BPWCCUL’s commitment to social development, reflecting the Credit Union’s enduring philosophy of “people helping people.” Through strategic investments in projects that promote Wellness, Empowerment, and Learning, the Foundation supports initiatives that bring lasting value to communities across Barbados. During the fiscal year April 1, 2024, to March 31, 2025, the Foundation received applications for grant funding in various areas of interest. After careful
18 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED review and alignment with our funding priorities, three (3) community-based projects were successfully implemented. These projects reflect the Foundation’s holistic approach to community development— supporting youth, seniors, and vulnerable populations alike. Here’s a quick look at the impact we’ve made: • BARP Business Centre: In partnership with the Barbados Association of Retired Persons, we established a dedicated centre to empower our older adults. This space provides access to technology, skills training, and personalized support, helping seniors confidently navigate the digital world and stay active and engaged. • Sheltered Workshop – Psychiatric Hospital: This project created a supportive work environment for individuals recovering from mental health challenges. By offering vocational training and therapeutic activities, it helps promote reintegration into society, reduces stigma, and encourages long-term independence and social inclusion. • New Growth Aquaponics & Farming Project – Grantley Adams Memorial School: This innovative school-based agricultural project introduces students to aquaponics and sustainable farming. It’s a hands-on learning experience that not only boosts STEM (Science, Technology, Engineering and Maths) education and environmental stewardship but also provides fresh produce to the school and local community. Together, these three projects represent a significant investment of Barbados $207,400 in our communities. As we look ahead, Legacy Foundation remains dedicated to finding new opportunities to advance our philanthropic mandate and expand our partnerships. It is truly inspiring to see the tangible difference we are making, and we will continue to monitor the progress of these funded initiatives to ensure their long-term success and continued positive impact. Thanks you for your support and our shared commitment to building stronger communities. Updates to 2024 Key Matters of Significance The below table provides an update to the Key Matters of Significance raised by the Supervisory Committee at the last Annual General Meeting. Page Section Supervisory Committee Report Extract Status 40 3.1 Fraud Risk Management • Updating the Fraud and Whistle-blower policies • Education of staff and members • Implementation of a fraud risk awareness training • Monitoring of adherence to all policies Partially compliant 41 3.2.1 Corporate Governance Structure • ensure alignment with the demands of a DNB-SIFI and the 2023 FSC Corporate Governance Guidelines. Fully Compliant 41 3,2,2 Changes to the Board of Directors and Senior Management • once a member is no longer an elected official of the BOD of the BPWCCUL, that member should not continue to have a seat on any other BPWCCUL Group BOD unless approved by the current BPWCCUL BOD Fully Compliant 42 3.2.3 Directorships on Multiple Entities • Ensure that the number of interlocking directorships that exists across the BPW Group is limited to three (3) Fully Compliant 45 3.2.4 Corporate Governance – Implementation of Members’ resolutions and motions passed at the December 2022 and January 2023 AGM • Circulation of the Member approved resolutions in print media and having them brought up for approval at a Special General Meeting; and • Provision of a step by step guide to Members to explain the process for putting forward a resolution. Partially compliant Board of Directors’ Report (Continued)
19 SEPARATE FINANCIAL STATEMENTS 2025 Organisational Strengthening Member Centered Outlook During the year under review, we remained focused on streamlining our processes to enhance service delivery across all branches and reinforce our commitment to service excellence. A key initiative in this effort was the successful completion of service excellence training by our frontline team, rolled out under a “Set To Achieve Remarkable Service” (STARS) Program, thoughtfully and purposefully orchestrated by our in-house Human Resources Department. This training targeted critical areas such as development of staff’s personal skills to deal with members to an advanced level while enhancing member satisfaction, reducing wait times, improving turnaround times, and strengthening our brand image— key components in building a resilient and responsive service culture. To further support convenience and accessibility to our members, the Credit Union resumed pre-COVID operating hours at our satellite branches allowing members greater flexibility and ease to conduct their business with us. We also continued to invest in the future of our organization by fostering engagement with the youth demographic through our Thrift Club program. This initiative plays a vital role in building early brand identity and long-term member relationships. We are pleased to report continued year-over-year growth in program uptake, reflecting its increasing relevance and appeal. A comprehensive review of our Credit Risk Management Policy was also completed during the year. This strategic enhancement strengthens our financial position, reduces exposure to credit risk, and ensures compliance with evolving regulatory standards. In addition, it equips us to better respond to the competitive landscape and expand our suite of financial products to meet diverse member needs. Ultimately, service is not a one-time initiative—it is an enduring commitment woven into every aspect of our operations. As we move forward, we will continue to invest in our people, refine our processes, and adopt technologies that support exceptional service delivery. These ongoing efforts are essential to sustaining operational excellence, deepening brand loyalty, and fostering long-term member engagement. Talent Management & Capacity Building Over the past year, the organisation has placed a strong emphasis on strengthening our team to support member growth, improve service delivery, and align with our long-term strategic goals. This has been a core part of our broader organisational redesign, which aims to build a high-performing, member-focused culture. Strategic investments have been made in our people as our efforts have focused on building teams aligned with our values, while creating a supportive and engaging workplace environment. The following summarises key initiatives undertaken to strengthen our human capital and organisational capabilities. Key Developments Team Development and Capability Building We have implemented training programs including STARS (Set to Achieve Remarkable Service) Customer Service Training for all staff and specialized Sales Training for Relationship Officers. Training has been embedded into daily operations through coaching, performance check-ins, and real-time feedback, fostering a culture of continuous improvement and accountability. Recruitment and Workforce Alignment Our recruitment strategy has focused on filling critical skill gaps in front-facing roles, with realigned processes to strengthen our member-focused approach. Job Evaluation The job evaluation exercise continues as the final component of our corporate redesign. Significant progress has been made in discussions with the Employees’ Bargaining Unit with a commitment to reaching a timely and favourable conclusion for all parties. Rewards & Recognition The THRIVE Rewards & Recognition Program, launched in July 2024, has been implemented to show our appreciation for our 300+ employees. This program strategically supports the organisational values, by rewarding extraordinary effort and meaningful results. Industrial & Employee Relations As a result of the hiring of an Industrial Relations Manager during the period we have enhanced workplace harmony through: • Improved Grievance management training for all managers and supervisors • Direct staff engagement across all locations to address challenges and build trust • Revitalization of the Health & Safety Committee with expanded branch representation • Implementation of comprehensive safety training including fire safety, first aid, and anti-robbery measures These initiatives collectively strengthen our organisational foundation, enhance employee engagement, and position us to deliver even better service to our members as we move forward Digital Transformation We are pleased to share the progress we have made in our digital transformation journey over the past year, aimed at creating a more agile, secure, and member-
20 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED Board of Directors’ Report (Continued) focused experience for all. As noted in last year’s report having partnered with Cornerstone Advisors, recognised experts in the North American credit union sector, we performed a detailed assessment of our technological needs and created a phased roadmap to address critical gaps and position the organisation for long-term success. One of our key achievements this year in moving along that transformation roadmap is a project to launch a new, modern online and mobile banking platform, designed to provide a seamless and secure experience. With advanced features such as multi-factor authentication, biometric access, and the ability to view all accounts— including joint accounts—in a single interface, members will be able to enjoy enhanced convenience and security during the course of April 2025 when these services launch. Building on this momentum, we are also preparing to introduce online loan applications and a streamlined online member application process, enabling members to complete these tasks entirely online. To further enhance security as we transition to more online delivery of services, we are implementing “3D Secure” technology to protect online card transactions by verifying cardholder identity; completion is currently scheduled to be by the end of 2025. At the subsidiary level, a website redesign project for Capita Financial Services Inc. is progressing well, with completion scheduled for the third quarter. Successful conclusion of this project will deliver a modern, intuitive platform with improved functionality and member experience. To ensure oversight and continued progress on all of our technology related projects, Management will conclude the establishment of a Transformation Council, tasked with overseeing the execution of our digital strategy, by August 2025. These initiatives collectively demonstrate our ongoing commitment to delivering value to our members and to creating a more efficient and resilient future for our Credit Union. Cybersecurity & Cyber Incident Mitigation In 2024, we continued to take steps to ensure the integrity of your information and to ensure our systems are robust against evolving threats. We strengthened our email security by implementing advanced filtering and real-time monitoring of attachments, enabling swift responses to suspicious activities. Additionally, we migrated our email services to Microsoft 365, complemented by a cloud security platform, enhancing protection against cyber threats. We initiated the first phase of our network redesign to improve security and resilience, and to stay ahead of potential threats we deployed advanced threat detection systems capable of identifying adversarial behaviour even without malware presence. Preparedness for potential disruptions was a priority, with rigorous testing of our Disaster Recovery site ensuring minimal downtime. We also maintained and replaced computer hardware, including core banking servers, to ensure high system availability and physical resilience was enhanced through the replacement of our UPS devices and the introduction of a secure backup solution. Whistleblowing We are pleased to announce the launch of our whistleblowing framework, a secure and anonymous platform for reporting concerns developed in partnership with Navex Global, a leader in whistleblowing solutions. The framework includes confidential reporting channels such as a multilingual contact centre, webbased reporting, and anonymous submissions and is fully compliant with the Whistle-blower Protection Act, 2021-29. The implementation and roll-out of our whistleblowing initiative reinforces our commitment to combating corruption and unethical practices and strengthens corporate governance by encouraging transparency, accountability, and ethical behaviour across our organization. Strategically, the framework is intended to enhance stakeholder trust by ensuring concerns are addressed promptly and fairly while mitigating risks through early detection of misconduct. Community and Member Engagement We firmly believe that our success is deeply rooted in the well-being and growth of the communities we serve and in this regard the Credit Union continued to play a pivotal role in enhancing its social impact and community footprint, through a combination of strategic educational support, stakeholder engagement, outreach initiatives, and relationship-building efforts. During the year we strengthened our ties with members, partners, and the wider community in the following areas, doing so while upholding the values and cooperative principles to which we subscribe. Empowering Through Education Education remained a cornerstone of our efforts. We hosted multiple member sessions including “Maximize Your Decision-Making Power” equipping members with practical financial knowledge on estate planning and power of attorney services. Our hosted familiarisation webinars have been a valuable resource, helping both new and long-standing members maximise the benefits of their credit union membership. Additionally, we awarded $150,155 in educational grants to support tertiary studies, reflecting our commitment to lifelong learning.
21 SEPARATE FINANCIAL STATEMENTS 2025 Celebrating Excellence In September, we proudly celebrated 47 young achievers at our Annual Thrift Club Academic Awards Ceremony, distributing $55,800 across categories ranging from Common Entrance to Government Scholarships. Award Category Awardees Amount Common Entrance Examinations 20 $20,000 Common Entrance Examinations (Special Awards) - $- Caribbean Secondary Education Certificate (CSEC) Examinations 12 $14,400 Caribbean Advanced Proficiency Examinations (CAPE) 10 $15,000 Government Exhibition 4 $4,200 Government Scholarship 1 $2,200 TOTAL 47 $55,800 Furthering our commitment to education, we granted two Ralph Boyce Scholarships, valued at $7,500 each, to promising university students. Community Outreach and Contributions The credit union played an active role in the community, participating in events such as Barbados Gospelfest, the National Senior Games, and the World Heart Day Luncheon. Through our sponsorships and donations program, we invested $245,785 into causes that support youth, education, health, and culture. Our social outreach efforts also provided $156,241 in direct assistance to members facing challenges, showcasing our dedication to uplifting those in need. Nurturing the Next Generation During the period changes were member-approved for by-laws 2(2) & 21 and 13-1 which has resulted in the removal of the age restriction previously required for Credit Union membership, and the introduction of a separate qualifying share for members under 16 years of age. Our Thrift Club continued to inspire and engage youth through initiatives like our summer camp and Christmas party, while our School Savers Programme expanded to four primary schools, fostering financial literacy at an early age. The Thrift Club Advisory Committee played a key role in advocating for youth services and empowering young members. Selection of a new Committee is slated for August/September 2025. There will be seven seats available to any young Credit Union member 14 to 18 years old. Committee members serve for two (2) years with the opportunity for reappointment. Strengthening Member Connections This year, we hosted our first Meet-the-Board session, creating an open and transparent dialogue between members and our leadership. We also celebrated our heritage during International Credit Union Day and various Member appreciation days across our branch network. As we look to the future, we’re focused on expanding diaspora engagement through e-newsletters, launching a national financial literacy competition, and deepening our youth programs. At BPWCCUL, community is at the heart of everything we do. Your participation and trust drive our efforts to build stronger, more resilient communities. Together, we are not just making a difference - we are shaping a brighter future for all. Regulatory Environment Review During the fiscal period, the financial landscape continued to evolve with the Financial Services Commission’s (FSC) issuance of four key regulations, which required its registrants to either enhance or revamp their operational and reporting frameworks. These regulations; the Material Changes Disclosure, Fitness and Propriety, Domestic Non-Bank Systemically Important Financial Institutions, and Technology and Cyber Risk Management Guidelines, aimed to strengthen established practices. In addition, focus on anti-money laundering/combatting financing of terrorism/combatting proliferation financing (AML/CFT/CPF) continued to be a critical aspect. The commitment by all stakeholders involved in maintaining a robust AML/CFT/CPF system within the island resulted favorably, with Barbados being removed from the Financial Action Task Force’s (FATF) Grey List in February 2024.
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