BICCU ANNUAL GENERAL MEEING 2020

BICCU ANNUAL GENERAL MEEING 2020

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VISION STATEMENTTo offer economic empowerment to our members.

MISSION STATEMENTTo be the leading member owned financial services institution,

as we aim to be their primary source and support, offering friendly, quality, cutting edge services dedicated to helping

members achieve economic empowerment.

CORE VALUESCommitted to Service

Demonstrate care and concern for allCreate paths to financial freedom

Dedicated to the health and wealth of our members


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VISION MISSION VALUES


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TABLE OF CONTENTS

Vision & Core Values Inside Front Cover

Tables of Content 3

Standing Orders 4

Meeting Agenda 5

Prayer of St. Francis of Assisi 6

Message from The President of The League 7

Photos of Board of Directors 8

Photos of Supervisory, Credit & Education Committees 9

Photos of Staff 10

Directors’ & Committees’ Terms of Service 11

Minutes of the 30th AGM 12 – 24

Directors’ Report 25 – 29

Treasurer’s Report 30 – 32

Auditor’s Report & Financials 33 – 87

2021 Budget 88 – 89

Supervisory Committee’s Report 90 – 93

Credit Committee’s Report 94 – 97

Education Committee’s Report 98 – 99

Resolutions 100 – 102

2019 AGM Attendees 103 – 104

Highlights & Pictures 105 – 106

Notes 107

logo Back Cover


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• A member is to stand when addressing the Chair

• Speeches are to be clear and relevant to the subject before the meeting.

• A member shall only address the meeting when called upon by the Chairman to do so, after which he shall immediately take his seat.

• No member shall address the meeting except through the Chairman.

• When called upon by the Chairman, a member must first state his name before continuing with his comment and/or question.

• A member may not speak twice on the same subject except: a) The Mover of a Motion- who has the right to reply b) He rises to object or to explain (with permission of the Chair).

• The Mover of a Procedural Motion- such as an adjournment or postponement of the meeting, shall have no right to reply once the motion has been laid on the table.

• No speech is to be made after the “Question” has been put and carried negative.

• A member rising on a point of order is to state the point clearly and concisely. (A “point of order” must have relevance to the “Standing Order”).

• A member should not “call” another member “to order” but may draw the attention of the Chair to a ‘breach of order’.

• A question should not be put to vote if a member desires to speak on it or move an amendment to it- except, that a Procedural Motion “The Previous Question” “proceed to the next Business” or the “Closure”: “That the Question be NOW PUT”, may be moved at any time.

• Only one motion should be before the meeting at one and the same time.

• When a motion is withdrawn, it fails.

• The Chairman has the right to a “casting vote”.

• If there is equality of voting on an amendment, and the Chairman does not exercise his casting vote, the amendment is lost.

• Provision is to be made for protection by the Chairman from vilification (Personal Abuse) • Only members are allowed to speak or ask questions during the meeting.

STANDING ORDERS


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Call to OrderPrayer of St. Francis of AssisiWelcomeGreetings • The Bahamas Co-operative League Limited

Minutes from the 33rd Annual General MeetingMatters ArisingReports • Board of Directors’ Report • Treasurer’s Report • Auditor’s Report • 2021 Budget • Supervisory Committee’s Report • Credit Committee’s Report • Education Committee’s Report

New BusinessResolutionsElections • Board • Supervisory Committee • Credit Committee

Motion for Adjournment

MEETINGAGENDA 2020


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Prayer of St. Francis of Assisi

Lord, make me an instrument of Thy Peace. Where there is hatred, let me sow love

Where there is injury, pardonWhere there is doubt, faith

Where there is despair, hopeWhere there is darkness, light Where there is sadness, joy!

O divine Master, grant that I may not so much seek To be consoled as to console;

To be understood as to understand;To be loved as to love.

For it is in giving that we receive,It is in pardoning that we are pardoned,

And it is in dying that we are born to eternal life

OUR PRAYER


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Message fromMR. HILTON BOWLEGPresidentBahamas Co-operative League Limited (BCLL)

Fellow Cooperators it is indeed my privilege to extend greetings and congratulations to the Members, Volunteers and Staff of the Bahama

Islands Co-operative Credit Union on the hosting of your 34th Annual General Meeting.

2020 has been an extremely difficult year due to the Global Pandemic that has greatly affected the country and the Members of our great Movement in the most profound ways. The deadly virus, Covid-19, continues to wreak havoc on the lives and economies of the World and whilst it is believed that a vaccine will soon be available, it will take years for us to restore the economy of The Bahamas to where it was prior to the pandemic.

Your theme this year: “Weathering the storm while adapting to the new norm” is certainly what we must all do, as we work together to assist Members and continue to build a strong and vibrant Co-operative Credit Union sector. We must offer relevant products and services that meet the needs of members while adhering to the polices, laws and Co-operative Principles that govern our sector.

On behalf of The Bahamas Co-operative League Limited, I commend BICCU for its growth and advancement over the years. We know that the Credit Union will indeed weather this current storm through the dedication of its Members, Board and Staff. I also pledge the continued commitment of The Bahamas Co-operative League Limited as you pursue the advancement of the Credit Union.

Have a successful Annual General Meeting!


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Barry RolleChairman

Hilton BowlegVice Chairman

Mark BullardAssistant Treasurer

Angela Culmer-Hinsey Treasurer

Estella Walkes-PrattSecretary

Janet GuerrieraAssistant Secretary

Gene AlburyDirector

Board Of Directors


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EDUCATION COMMITTEE

CREDIT COMMITTEE

SUPERVISORY COMMITTEE

Rashard Ritchie Rhonda Richardson-Chase

Horatio McKenzie

Finesse Rahming

Marlon Bethel Kenneth Lightbourne

Shevaun Bain

Claudette FarringtonSecretary

David BarryChairman

A. Mary Davis Secretary

Tanishia BrennenChairman

Nashon RolleChairman

Jasmine CollieSecretary

Elston Bain A. Quentin Culmer

PhotoMissing


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Mark BastianCEO

Jamison DavisCollections Manager

Catherine KnowlesLoan Officer I

Robertha MurraryTeller Supervisor

Bryan ButlerLoans Manager

Jayson LewisLoan Officer II

Neko MossAccounts Officer

Michelle KingMembership Services Rep. I

Maya MullingsTeller

Chandalear ForbesMarketing & Membership

Services Manager

Carolyn MossCompliance Officer

Patrice ColebrookMembership

Services Rep. II Alkeisha EdgecombeCollections Officer

Tamara StubbsMessenger/Filing Clerk

Demethera PoitierTeller

Alexandria MossMembership Services Rep. I

Michella BarryMembership Services Rep. I

Alexandria BoweFinancial Controller

Angelique McQueenInternal Auditor

Waydrissa McPhee Accounts Clerk

Delilah BarrHead Teller

Staff


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DIRECTOR ELECTED/APPOINTED 2020 2021 2022

Estella Walkes-Pratt 2017 √Hilton Bowleg 2018 √Barry Rolle 2019 √Mark Bullard 2018 √Janet Guerriea 2019 √Angela Culmer-Hinsey 2017 √Gene Albury 2018 √

MEMBER ELECTED 2020 2021 2022

Marlon Bethel 2019 √David Barry 2017 √Horatio McKenzie 2018 √Kenneth Lightbourne 2019 √Jasmine Jones 2017 √

MEMBER ELECTED/APPOINTED 2020 2021 2022Shevaun Stubbs 2018 √Archelaus Culmer 2019 √A. Mary Davis 2019 √Tanisha Brennen 2018 √Elston Bain 2019 √

BOARD OF DIRECTORS

SUPERVISORY COMMITTEE

CREDIT COMMITTEE

TERMS OF SERVICE


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1. CALL TO ORDERThe 33rd Annual General Meeting (AGM) of the Bahama Islands Co-operative Credit Union Limited (BICCU) was called to order at 6:10 pm on June 28th, 2019 in Crown Ballroom A, of the Atlantis Paradise Island Resort Hotel, by Chairman of the Board of Directors, Mr. Barry Rolle.

2. QUORUMChairman Barry Rolle read into the minutes, Section 22 (2), of the Bahamas Cooperative Credit Union Act, 2015: Quorum - “Where a quorum is not present one hour after the time fixed for the commencement of the meeting of members, the meeting shall proceed, and the members present shall constitute a quorum.”

3. PRAYER OF ST. FRANCIS OF ASSISIEstella Walkes-Pratt, Secretary of the Board of Directors led the AGM in the Prayer of St. Francis of Assisi.

4. STANDING ORDERChairman Rolle invited all to take a moment to review the Standing Orders printed on page four of the AGM Booklet.

5. ACCEPTANCE OF THE AGENDA Motion for the acceptance of the Meeting Agenda was moved by Mr. Jeremiah Hepburn, seconded by Mr. Calnan Weech and was carried unanimously.

6. WELCOMEChairman Rolle welcomed all on behalf of the Board of Directors, Committees, Management and Staff of BICCU to the 33rd AGM under the theme, “Striving to Make a Difference: Because Members Matter”. The Chairman requested a moment of silence for all of those who passed since the last AGM in particular Mrs. Deloris Cooper, wife of Founder Eugene Cooper. The Chairman extended a special welcome on behalf of the membership to Mr. Hilton Bowleg, President of the Bahamas Co-operative League Limited; Ms. Theresa Deleveaux and Ms. Jackie

Whymns of Teachers & Salaried Co-operative Credit Union Limited, Members and Guests.

Chairman Rolle invited Ms. Theresa Deleveaux to the podium to bring greetings on behalf of the Bahamas Co-operative League Limited.

7. GREETINGS

7.1. The Bahamas Co-operative League Ms. Deleveaux, extended congratulations to

the Board, Management, Staff and Members of Bahama Islands Co-operative Credit Union Limited on its 33rd Annual General Meeting, she stated that the theme “Striving to Make a Difference, Because Members Matter” is timely and very fitting because members are also owners of this great institution and the only way to ensure that credit unions remains a viable entity is by the membership doing business with themselves. Ms. Deleveaux stated that banks are trying to copy the co-operative way, they are attempting to lure members with lower interest rates, but unlike with credit unions, members do not share in the profits; she encouraged members to obtain their loans from their credit union as this drives income and helps to generate profit.

Ms. Deleveaux informed the members that they are also part owners of the insurance brokerage company, she encouraged all to utilize the company to insure their cars, homes etc. as a part of the profit will be returned to BICCU.

Additionally, Ms. Deleveaux notified the membership that the credit union through the insurance company offers protection over savings and loans. Further she explained that when a member dies before the age of 60, any savings in

MINUTES OF THE 33rd ANNUAL GENERAL MEETING

BAHAMA ISLANDS CO-OPERATIVE CREDIT UNION LIMITED

THEME: “STRIVING TO MAKE A DIFFERENCE: BECAUSE MEMBERS MATTER”


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the credit union up to $20,000.00 is doubled. Funds saved between 60 and 65 is paid at 75% providing it does not exceed $20,000.00. Additionally, loans once issued before the age of 60, are paid off upon death.

Ms. Deleveaux also highlighted other products offered by the insurance company such as the Burial Program whereby members can purchase a $10,000.00 plan for $7.00 per month; additionally, a very affordable medical coverage is offered.

Ms. Deleveaux informed that The Bahamas Co-operative League Limited, in addition to providing advocacy also provides training for the various credit unions which helps credit unions meet requirements established by The Central Bank of The Bahamas.

Ms. Deleveaux stated The League applauds BICCU on its growth and success to date; further she stated that she is happy to have played a role in the launch and setup of BICCU.

Ms. Deleveaux thanked BICCU for its continued support of the Bahamas Co-operative League Limited and on behalf of The League and the Insurance Company, she extended best wishes for a productive Annual General Meeting.

8. MINUTES OF THE 32nd AGM

A motion to dispense with the reading of the 32nd AGM Minutes was moved by Ms. Rosemary Campbell, seconded by Ms. Tamara Bullard and was carried unanimously.

Corrections:

8.1. Page 25 Item 16.4: Mr. Calnan Weech stated that the Education Committee received a stipend of $1,200.00 per person, per year. Mr. Weech’s comment was noted.

9. MATTERS ARISING

9.1. Item 6.7: Mr. Calnan Weech stated that last year Vice Chairman Bowleg indicated that he would forward the report from the Bahamas Co-operative League Limited to all interested parties, he inquired as to whether this was done as he had

not received the report.

9.1.1 The member was presented with a copy of The League’s AGM Book, he responded that it was not what he was expecting but he would accept it.

9.1.2 Vice Chairman Bowleg advised that the League’s office was open daily, members can visit the office at any time and retrieve any information on the movement once it is related to the credit union.

9.1.3 Page 23 Item 14.13 Mr. Calnan Weech stated that the word should be report, the correction was noted.

The motion to accept the minutes with corrections and the matters arising was moved by Ms. Barbara Williamson and seconded by Ms. Rosemary Campbell, the Motion carried.

10. REPORTS

10.1. ANNUAL GENERAL MEETING BOARD OF DIRECTORS’ REPORT

10.2. The motion to dispense with the reading of the Board of Directors’ Report was moved by Ms. Rosemary Campbell and seconded by Mr. Dave Beckford, Motion carried.

10.3. Chairman Rolle thanked the members for their support over the year, he stated that it is because of the membership that the credit union has succeeded to the level that it has. The Chairman also thanked the Board and Committees but most importantly he thanked the staff and management team led by Mr. Mark Bastian, CEO who has worked diligently to improve the credit union’s performance compared to the year 2017 which he stated was a dismal year.

10.4 The Chairman advised that the credit union made good strides and ended 2018 with a profit of $236,000.00 compared to 2017 when there was a loss of $318,000.00, this was a $600,000.00 turn around. Further he stated that loans grew by $1.7 million in 2018.

10.5 Additionally the Chairman stated that the credit union’s delinquency rate decreased from 11.3% to 5.9% by the end of 2018 which is the second


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lowest of the credit unions. Chairman Rolle stated that the delinquency balance decreased from $2.6 million to $1.5 million while the delinquent accounts decreased from 355 account at the end of 2018 to 237 at the end of 2018. The amount of write-off also decreased from $939,000.00 to $636,000.00. Provisioning decreased from $967,000.00 to $472,000.00.

10.6 Chairman Rolle stated that the Board is pleased by the efforts made in the area of delinquency, he said that there is still a hurdle to cross relating to Baha Mar whose employees are still on the delinquency list due to the fact that the company does not allow salary deductions at this time; however, the Chairman advised that discussions are being had with Baha Mar in an effort to remedy this issue.

10.7 Chairman Rolle advised that the credit union’s membership increased by 835 members in 2018. The Chairman further advised that for the member’s convenience, the credit union installed an ATM and now offers cash eliminating the need to go to another bank to cash your BICCU cheques.

10.8 The Chairman stated that BICCU has made many strides and will continue to grow with the support of the membership. He stated that BICCU should be the members primary provider for financial services because once BICCU grows the members benefit. Once the credit union succeed, the members succeed. Further he advised that the only way the credit union could offer the low rates on loans and high rates on savings is if the credit union has the members’ ultimate support.

10.9 Mr. Calnan Weech congratulated the Board and management for a wonderful year. The member then referred to page 30 and inquired as why the Board had taken steps to curtail the growth of member deposits. Chairman Rolle advised that persons are coming to the credit union chasing the deposit rates, further he advised that the credit union is getting in more money than it is lending; consequently, a temporary moratorium has been placed on new member fixed deposits until loans can be increased.

10.10 Mr. Weech stated that in other words, the credit union wants its members to borrow more. The Chairman stated that the credit union is in the

business of loans.

10.11 Mr. Weech also highlighted the fact that the credit union cannot get deductions from members employed at Baha Mar which makes it difficult to keep these members off the delinquent list. Mr. Weech enquired as to whether National Credit Union was having the same issue. Chairman Rolle responded that they were.

10.12 Mr. Weech advised that persons such as the Pension Board and the Bahamas Hotel Association may be able to assist the credit union with securing deductions from Baha Mar. Mr. Weech stated that the President of the Bahamas Hotel Board is in attendance at the AGM as well as persons on BICCU’s Board who are also on the Pension Board, it is his hope that they can use their influence and get the contacts with Baha Mar to make this happen.

10.13 Chairman Rolle advised that a member of BICCU’s Board has tried to assist; however, it requires a change of the system currently used by Baha Mar.

10.14 Director Albury advised that it is not that Baha Mar would not give BICCU a deduction, the system currently employed by Baha Mar only allows for one deduction. The Director stated that he personally spoke to the person in charge and he will go back again to try to have the matter remedied.

10.15 Mr. Weech recommended that the fact that the credit union now has an ATM and is on a cash basis, it should push not to be treated as a deduction but as another direct deposit into a bank. Further he stated that Atlantis should not be treating what is sent into the credit union as a deduction, it should be that the member is sending his/her money to different banks. Mr. Weech suggested that BICCU seek the backing of the Central Bank to get employers to treat credit unions the same way they treat the banks, deductions should simply be deposits into the credit union. Chairman Rolle stated that BICCU is working on this, working to be the primary financial institution for its members.

10.16 Mr. Weech enquired as to the ATM, he stated that there appears to be a link between BICCU and Fidelity. Chairman Rolle advised that the ATM is


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on Fidelity’s platform, they will be conducting the training and maintaining the system for BICCU. Mr. Weech further enquired as to whether withdrawals can be made from a Fidelity ATM, the Chairman answered in the affirmative.

10.17 Mr. Weech requested clarification on the treatment of qualifying shares. Chairman Rolle advised that the Credit Union attempted to split the shares into qualifying and equity shares. Further, he stated that in order to be a member of the Credit Union qualifying share must be purchased. He stated that in the past, upon leaving the Credit Union these funds were returned to the member; however, the Regulators advised that the qualifying share are nonrefundable. This he stated is with immediate effect.

10.18 Mr. Weech enquired as to whether dividends will still be paid on the shares. The Chairman answered in the affirmative.

10.19 Mr. Weech also enquired as to why the Credit Union does not take pattern after Teachers Credit Union and set up a company and go into the real estate business as the management of properties allows Teachers another revenue stream. Chairman Rolle responded that the Act prohibits the ownership of property unless it is utilized by the credit union. Further the Chairman advised that there are limitations on the type of investments.

10.20 Stephanie Miller enquired as to the ATM, is there a cost for Fidelity to run it? Chairman Rolle responded in the affirmative.

10.21 Barbara Williamson enquired as to whether the share price could be reduced since members shares are nonrefundable. Chairman Rolle stated that this is not permitted by the regulators.

10.22 A motion for the acceptance of the Annual General Meeting Board of Directors’ Report was moved by Mr. Calnan Weech, seconded by Ms. Ruth Neily and was carried unanimously.

11 TREASURER’S REPORT

11.1 The motion to dispense with the reading of the Treasurer’s Report was moved by Ms. Rosemary Campbell, seconded by Ms. Tamara Bullard and

was carried unanimously.

11.2 Mr. Calnan Weech enquired as to whether the auditor will be presenting his report. Assistant Treasurer Bullard answered in the affirmative.

11.3 Assistant Treasurer Bullard enquired as to whether there were any questions. There were none. The Assistant Treasurer stated that he wished to highlight three important points on the financial statement.

11.4 The Assistant Treasurer also stated that the success of 2018 should be celebrated. Last year, 2017, the credit union had a loss of $419,000.00, this year we had a profit of $236,000.00, a profit of 177%.

11.5 The Assistant Treasurer stated that it was important to highlight the number of deposits compared to the number of loans. Loans increased by 8.2% or $1,889,411. Deposits increased by 16.3% or $5,563,827.00. Further he stated that the two accounts are very related, the credit union had an increase of over $5 million in deposits but only $1.8 million in loans.

11.6 The Assistant Treasurer stated that deposits are growing more than loans, he added that the credit union grows via loans, so it is important to grow loans.

12 AUDITORS REPORT

12.1 Mr. James Gomez, Partner, Baker Tilly Gomez asked for permission to forgo the reading of the auditor’s report and to focus on the qualification in the financial statement and highlight the fact that it has been modified and to underscore to the membership why.

12.1.1 The motion to dispense with the reading of the Auditor’s Report was moved by Mr. Calnan Weech, seconded by Mr. Dave Beckford and was carried unanimously.

12.2 Mr. James Gomez advised that the audited report was dated May 6, 2019. Further, he advised that the report was modified for two reasons. The International Financial Reporting Standard 9 outlined on page 41 is the first base for the qualified opinion. It speaks to the accounting


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standards which require credit unions to reclassify its financial instruments into new categories and to provide for the impairment of certain financial instruments based upon expected losses instead of experienced losses.

12.3 Mr. Gomez stated that currently, and as it has been in the past, the credit union’s financial statements in terms of provisioning was based on what was experienced, the loss had already occurred and provisioning was based on the PEARLS standard and was on a percentage bases and what had already happened. The Auditor advised that the new standard, impairment on loan provisioning takes place on the date the loan is booked and is determined based on internal policies which must be consistent with standard to make provisioning on the loan at that time, this he stated should flow into the profit and loss.

12.4 Mr. Gomez stated that the fact that the credit union has been in existence for a long time means that once implemented, the credit union will take a significant hit to its bottom line. Further he stated that it will be necessary to assess each loan which will take some time; he advised that this is why the credit union got a qualified report.

12.5 The Auditor stated that the Central Bank has allowed for all credit unions to forgo the adoption of the standard; however, effective January 1, 2020 the credit union will have to be compliant.

12.6 Mr. Gomez advised that there would have to be an extensive exercise to assess every loan account to determine the likelihood of default.

12.7 The Auditor stated that there are other provisions in this standard, he advised that if the credit union held treasury bonds or government paper, every instrument must have an element of default as countries do default on their debt. Further, he stated that the Bahamas Institute of Chartered Accountants (BICA) has established a rate of default which will be used across the board for sovereign debt in respect of Government bonds. The Accountant further stated that provisioning will be straight across the board and will affect the bottom line.

12.8 Mr. Gomez stated that IFRS 9 is an aggressive policy, the benefit will not be seen until the policy

is fully implemented and the assessment is done as time passes.

12.9 Mr. Calnan Weech clarified that where the credit union has Bahamas Government registered Stock it will be necessary to implement an interest income loss provision. The Auditor answered in the affirmative. Further he stated that BICA firms got together and established a policy across the board for financial statements so that everyone who hold Government paper, credit unions, banks etc. will handle the provisioning the same.

12.10 Mr. Weech enquired as to whether this will be posted at some point because if a member pays his/her loan consistently for 5 to 10 years, the credit union will have to consider that the member may default on the loan so the credit union will have to put a percentage default on the loan that will have to be deducted from the net income. He asked if BICA will put a standard on this. Mr. Gomez answered in the negative stating that BICA only established the uniform policy for sovereign debt, Government paper. The Auditor explained that institutional paper varies from industry to industry so what is in a credit union may not be the same as what is in a bank. He stated that the individual will have to be examined on a person by person basis.

12.11 The Auditor advised that page 41 contains the statement referring to Central Bank’s deferment of the adoption of the standard until January 1, 2019, he stated that initially he said 2020; however, what he actually meant was that by January 1, 2020 IFRS9 must be in effect. Further Mr. Gomez clarified that the financial statements currently being reviewed is the 2018 statement, he stated that the financial statement for 2019 must show the full adoption of the standard.

12.12 Mr. Gomez stated that the full adoption of the standard will take a considerable amount of time, additionally, he stated that it is taxing, hence the credit unions were not ready. Further he stated that financial institutions have been working on the implementation of the standard for the last two years to be ready for full adoption in 2018.

12.13 The Auditor stated that the second reason for the qualification is that the credit union has classified members qualifying shares which are available for withdrawal, as equity and the statement of


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financial position and the dividends paid on these shares as an appropriation of retained earnings. This he said, should not happen as those shares are payable on demand as such they should be classified as liabilities and the dividends paid on these shares be classified as an expense. Further, he stated that if a member walks in the Credit Union and requests to close his/her account and withdraw his/her qualifying shares from the Credit Union there is nothing that prohibits the member from getting the funds.

12.14 Mr. Gomez stated that if member shares were classified in accordance with IFRS, liabilities will increase, and members equity will also increase by $1.4 million and profit would have decreased by $99,000.00 The Auditor stated that next year the numbers will be shown according to the standard in the first year and will have some impact on the Credit Union’s financial statement. He stated that members may be alarmed in the first year but in the subsequent years the impact will not be as significant as the Credit Union would be provisioning for the loan at the time the loan is booked.

12.15 The Auditor stated that the report on the Legal and Regulatory Requirements is found on page 43. Further, the Auditors confirmed that the Credit Union has kept its accounting and records in accordance with the Bahamas Co-operative Credit Union Act, 2015, its Regulations and Bye-Laws.

12.16 The auditor stated that too often the AGM forego the reading of the Treasurer’s Report, he stated that this is an important report as it is the lifeline of the organization so sometimes the AGM should take time to listen to the Treasurer’s Report.

12.17 Mr. Calnan Weech stated that it is accepted that if an audit is presented and there is an error, the entire audit should be dismissed. Mr. Weech advised that he found two errors, the first one was a small error on page 56, Cash in Hand which stated that the facility was secured by a hypothecation over $50,000.00 fixed asset in note 52 (b) (2), however, he stated that the reference should be 52 (b) (3), Scotia, Scotia, it should be consistent.

12.18 Additionally, Mr. Weech highlighted an error on page 57 Other Deposits, he stated that ordinarily the balance at the beginning of the year, deposits

and or withdrawals plus interest earned at the end of the year equals the balance at the end of the year. Mr. Weech stated that the balance at the end of 2017 was not carried over to the start of 2018, this he advised resulted in a difference of $1,300.00 and a balance of $976,363.00. Mr. Weech further stated that this number is also listed on the Balance Statement where the same number is brought across resulting in a total of $963.00 instead of $964.00.

12.19 Mr. James Gomez responded that in terms of financial statements the audit must be materially correct, he stated that Mr. Weech’s first point does not speak to materiality.

12.20 As for Mr. Weech’s second point the auditor stated that sometimes in printing, because the financial statement consists of a combination of excel and word documents, some things fall out of whack during the merge, so the number did not come over. Further Mr. Gomez confirmed that the number on the face of the financial statement, financial position #444 is correct.

12.21 Mr. Weech enquired as to whether the mistake will be corrected.

Motion to accept the Auditor’s Report with adjustments moved by Ms. Barbara Williamson; seconded by Mr. Ivan Miller and was passed unanimously.

13. 2020 Budget Report

Mr. Calnan Weech enquired as to the $2 million deposit with Fidelity. Chairman Rolle stated that Fidelity had the best rates.

A motion to accept the 2020 Budget was moved by Ms. Tamara Bullard seconded by Mr. Dave Beckford, and was unanimously carried.

14. SUPERVISORY, CREDIT & EDUCATION COMMITTEES REPORTS

14.1 SUPERVISORY COMMITTEE REPORT A motion to dispense with the reading of the

Supervisory Committee’s Report was moved by Ms. Rosemary Campbell, seconded by Ms. Tamara Bullard and was carried unanimously.


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14.1.1 Mr. Calnan Weech thanked the Supervisory Committee for a very good report. Mr. Weech referenced page 86, Bank Reconciliation, he enquired as to whether this is still a concern, he read the Committee’s comments, “The Committee continues to experience challenges with respect to the monthly reconciliation in a timely manner.”

14.1.2 Chairperson J. Almitra Jones stated that this was due to human resources challenges after the departure of the previously hired Accountant. In 2018 the Credit Union hired consultants who left early, two other persons who were hired left early. Ms. Jones stated that with the hire of an accountant and a junior accountant, they are still trying to come up to speed with the reconciliations.

14.1.3 Mr. Weech queried the Member Suspense Accounts Receivable Policy; he asked the Chairperson to highlight why was it is important for bank reconciliations to be done in a timely manner as it is the place where nefarious things could happen. Mr. Weech enquired as to the Suspense Accounts Receivable Policy, what is it and why is it an issue.

14.1.4 Chairperson J. Almitra Jones responded that the Suspense Accounts Receivable is an account that is used temporarily or permanently to carry a doubtful or if there is a discrepancy, the funds go into this account until the transaction has been identified. The Chairperson explained that the account should have a zero balance, at the very least it should be reconciled on a regular basis to ensure that nothing unethical or nefarious happens in the account. Ms. Jones further explained that the Board is equally as concerned as the Committee regarding this account and efforts are being made to reconcile this account. Additionally, the Chairman stated that an audit is scheduled for July when transactions will be reviewed, this she said will provide an independent assurance of the validity of the transactions in the Suspense Account.

14.1.5 Mr. Calnan Weech stated that the Board, Treasurer’s and Audit Report outlined the amount of work that has to be done. Further, he stated that the members should understand that this will result in higher regulatory cost for the credit unions, he suggested that credit unions should work together. Mr. Weech stated that World Council

of Credit Unions will be coming to The Bahamas, he stated that this is a wonderful opportunity to lobby government about how credit unions are treated. Further Mr. Weech suggested that the World Council President should meet with the Prime Minister or Deputy Prime Minister along with the League in an effort to bring down costs and to get a fair hearing with the Central Bank of The Bahamas.

14.1.6 Mr. Calnan Weech urged credit unions to do more things together so that expenses and prices are not so high otherwise with what the credit union is facing next year will be a huge loss for 2019, Chairperson Jones, agreed stating that there is strength in numbers.

Motion for the acceptance of the Supervisory Committee’s Report moved by Ms. Barbara Williamson, seconded by Ms. Ruth Neily, unanimously carried.

14.2 CREDIT COMMITTEE REPORT A motion to dispense with the reading of the Credit

Committee Report was moved by Ms. Barbara Williamson, seconded by Ms. Tamara Bullard and was carried unanimously.

14.2.1 As Mrs. Maxine Pratt Chairperson was not present in the room, the presentation of the report was delayed.

14.3 EDUCATION COMMITTEE REPORT A motion to dispense with the reading of the

Education Committee Report was moved by Ms. Barbara Williamson, second by Mr. Ivan Miller and was carried unanimously.

14.3.1 There were no questions or comments. Motion for the acceptance of the Education

Committee’s Report, moved by Mr. Rudy Dean, seconded by Mr. Ivan Miller, carried unanimously.

15. NEW BUSINESS

15.1 There was no New Business.

16. RESOLUTIONS

Secretary Walkes-Pratt presented the resolutions as follows:


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16.1 RESOLUTION #1

RESOLUTION FOR THE PAYMENT OF DIVIDENDS

WHEREAS the audited financial statements of the Bahama Islands Co-operative Credit Union Limited (BICCU) for the year ending December 31, 2018 were presented and accepted by this Annual General Meeting;

BE IT RESOLVED that this Annual General Meeting approved the payment of a Four percent (4 %) dividend to shareholders on their Qualifying Shares held for the year 2018;

BE IT FURTHER RESOLVED that calculation and

distribution of these dividends be credited to the individual member accounts not later than July 31, 2019

16.1.1 The Secretary invited all in favour of the Resolutions to sit, and all against the resolutions to stand. Resolution carried, unanimously.

16.2 RESOLUTION #2 RESOLUTION FOR THE APPOINTMENT OF

AUDITORS

WHEREAS The Bahamas Co-operative Union Act, 2015 requires that the Directors cause the accounts of the Credit Union to be audited at the end of each financial year by an auditor appointed by the Board.

BE IT RESOLVED that the Board of Directors of

the Bahama Islands Co-operative Credit Union Limited (BICCU) be allowed to choose an auditing firm to conduct the audit for the fiscal year 2019.


16.3 RESOLUTION #3

RESOLUTION FOR REMUNERATION TO MEMBERS OF THE BOARD OF DIRECTORS

WHEREAS The Bahamas Co-operative Union Act of 2015 requires formal approval of all remuneration paid to Directors of the Bahama Islands Co-operative Credit Union Limited in accordance with –

Section 58 (1)

No director and or no member of a committee is entitled to be paid any remuneration in connection with his duties as a director or a committee member of a co-operative credit union or for his attendance at meetings unless the remuneration –

a) Is fixed in the bye-laws; and

b) Is ratified annually by the members, by resolution at the annual general meeting.

BE IT RESOLVED THAT Directors of the Bahama Islands Co-operative Credit Union Limited shall receive a stipend of Five Hundred Bahamian Dollars (B$500.00) per month.


16.4 RESOLUTION #4 REMUNERATION TO SUPERVISORY

COMMITTEE MEMBERS OF THE BAHAMA ISLANDS CO-OPERATIVE CREDIT UNION LIMITED

WHEREAS The Bahamas Co-operative Union Act of 2015 requires formal approval of all remuneration paid to Members of the Supervisory Committee of the Bahama Islands Co-operative Credit Union Limited in accordance with –

Section 58 (1)




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BE IT RESOLVED THAT the members of the Supervisory Committee of the Bahama Islands Co-operative Credit Union Limited shall be paid a stipend of Two Hundred Bahamian Dollars (B$200.00) per month.


16.5 RESOLUTION #5 REMUNERATION TO CREDIT COMMITTEE

MEMBERS OF THE BAHAMA ISLANDS CO-OPERATIVE CREDIT UNION LIMITED

WHEREAS The Bahamas Co-operative Union Act of 2015 requires formal approval of all remuneration paid to Members of the Credit Committee of the Bahama Islands Co-operative Credit Union Limited in accordance with –

Section 58 (1)




BE IT RESOLVED THAT the members of the Credit Committee of the Bahama Islands Co-operative Credit Union Limited shall be paid a stipend of Two Hundred Bahamian Dollars (B$150.00) per month.

16.5.1 Mr. Calnan Weech highlighted the fact that the words in the resolution stated a stipend of Two Hundred Dollars, however the dollar amount stated B$150.00 per month.

16.5.2 Secretary Walkes-Pratt thanked the member and advised that the amount should be One Hundred

Fifty Dollars.

16.5.3 The Secretary invited all in favour of the Resolutions with corrections to sit, and all against the resolutions to stand. Resolution carried, unanimously.

16.6 RESOLUTION #6

REMUNERATION TO EDUCATION COMMITTEE MEMBERS OF THE BAHAMA ISLANDS CO-OPERATIVE CREDIT UNION LIMITED

WHEREAS The Bahamas Co-operative Union Act of 2015 requires formal approval of all remuneration paid to Members of the Education Committee of the Bahama Islands Co-operative Credit Union Limited in accordance with –

Section 58 (1)




BE IT RESOLVED THAT the members of the Education Committee of the Bahama Islands Co-operative Credit Union Limited shall be paid a stipend of One Hundred Bahamian Dollars (B$100.00) per month.


16.7 RESOLUTION #7

QUALIFYING SHARES WHEREAS the Bahamas Co-operative Credit

Union Act, 2015 defines qualifying shares as non-withdrawable


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BE IT RESOLVED that per the directive from the Central Bank of The Bahamas, BICCU wishes to reverse the share split (Qualifying shares $50.00 and Equity Shares $150.00) approved by the Membership at the 32nd Annual General Meeting held June 29, 2018, and with immediate effect cease the practice of allowing the withdrawal of Qualifying Shares.


16.8 RESOLUTION #8

CONSTITUTION OF ELECTED COMMITTEES

BE IT RESOLVED that the Elected Committees cannot have more than one serving Committee Member employed in the same department at the same employer.


16.9 RESOLUTION #9

NOMINATIONS FROM THE FLOOR

WHEREAS the Draft Uniform Bye-Laws for Co-operative Credit Unions operating in The Bahamas under The Bahamas Co-operative Credit Unions Act, 2015 states that no member may be elected to the Board, the Credit committee and the Supervisory committee unless he or she has satisfied the fit and proper requirements.

BE IT RESOLVED that for the effective management and proper administration of the Credit Union, effective immediately, no member will be nominated to hold an elected office unless an application was duly submitted and approved by the Nomination Committee.


16.10 RESOLUTION #10

MAXIMUM LIABILITY

WHEREAS the Bahamas Co-operative Credit Union Act, 2015 states that a co-operative credit union shall not borrow funds in excess of ten percent of its total assets.

BE IT RESOLVED that the Maximum Liability that

the Directors can bind the Credit Union for is ten percent of the Credit Union’s total assets.



TRAINING BUDGET

WHEREAS the Draft Uniform Bye-Laws for Co-operative Credit Unions operating in The Bahamas under The Bahamas Co-operative Credit Unions Act, 2015 states that the Annual training and conference budget of board members shall not exceed one third (1/3) of the credit union’s total staff training budget.

BE IT RESOLVED that the Annual training and conference budget of BICCU’s Board of Directors shall not exceed one third (1/3) of the credit union’s total staff training budget


RESOLUTIONS SUBMITTED BY THE NOMINATION COMMITTEE


BOARD TERM LIMITS

WHEREAS societal and economic changes require Boards to continually assess their skill sets to ensure the Board remains competent.

AND WHEREAS the Bahama Islands Co-operative Credit Union wishes to encourage fresh viewpoints in the boardroom and the broadest


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with responsibility for the prudent management of millions of dollars in assets;

AND WHEREAS this responsibility requires that

Board members have a minimum level of financial literacy;

BE IT RESOLVED that new Board members be required to attend and complete an approved assigned course in financial management;

BE IT FURTHER RESOLVED that a copy of the

certificate of completion be placed on the board member’s files.

16.14.1 The Motion to accept the Resolution was moved by Ms. Rose Campbell, seconded by Ms. Barbara Williamson. Resolution carried, unanimously.

17. ELECTIONS

Chairman Rolle invited Mr. Carlton Russell, Chairman of the Nomination Committee to the podium. Mr. Russell congratulated the Board, led by Chairman Rolle and the CEO, Mark Bastian for a fine job, year over year, 2017 over 2018, a 177% turnaround which equates to over $600,000.00.

Nomination Committee Chairman Carlton Russell invited Directors Barry Rolle and Janet Guerriea to demit their seats. Further he explained that the election process will require that the room be counted three (3) times, once before each vote. There will be one line to place the ballot in the box and members are asked to place the ballot in the box with the hand that has the wrist band. Additionally, he advised that members were only allowed to place one (1) ballot in the ballot box, no member would be allowed to place another member’s ballot in the box.

17.1 BOARD OF DIRECTORS: Mr. Russell advised that there were two vacancies

introduced the nominees for the Board of Directors as follows:

1. Janet Guerriea 2. Barry Rolle 3. Rosemary Campbell

17.1.1 There were no nominations from the floor. The nominees were given two minutes to address the members.

possible participation of members.

BE IT RESOLVED that directors be limited to three consecutive terms in office, and eligible for re-election to the Board after a minimum one-year absence from the board of directors.

16.12.1 The Motion to accept the Resolution was moved by Ms. Hope Curry, seconded by Ms. Claudette Farrington. Resolution carried unanimously.


AMENDMENT TO THE NOMINATION REQUIREMENTS

WHEREAS the Bahama Islands Co-operative Credit Union wishes to ensure that candidates for elected offices have demonstrated an interest in the credit union’s governance practices.

AND WHEREAS the current requirement of attendance at a minimum of two consecutive Annual General Meetings to qualify for nomination may be too restrictive.

BE IT RESOLVED that Bye-Law section 45, sub-

section (1) be amended as follows: Any member seeking a nomination to any elected

Committee must attend no less than two of the past three Annual General Meetings to qualify for nomination.

16.13.1 Member Rose Campbell requested

clarification of the resolution. Secretary Walkes-Pratt explained that the member was required to attend at least two of the last three AGM meetings.

16.13.2 The Motion to accept the Resolution was moved by Ms. Barbara Williamson, seconded by Ms. Rose Campbell. Resolution carried, unanimously.


FINANCIAL LITERACY

WHEREAS the Bahama Islands Co-operative Credit Union is a financial services organization


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Votes:

Nominees Votes Received Elected

Janet Guerriea 80 √

Barry Rolle 133 √

Rosemary Campbell 60

Congratulations were extended to Ms. Janet Guerriea and Mr. Barry Rolle.

17.2 SUPERVISORY COMMITTEE Members were advised there were (2) vacancies

for the Supervisory Committee, nominees are as follows:

1. Elston Bain 2. Marlon Bethel 3. Astranique Bowe 4. Rosemary Campbell 5. Fidentia Dorsett 6. Kenneth Lightbourne

17.2.1 There were no nominations from the floor. The nominees were given two minutes to address the members.

Votes:


Elston Bain 49

Marlon Bethel 51 √

Astranique Bowe 3

Rosemary Campbell 45

Fidentia Dorsett 46

Kenneth Lightbourne 85 √

17.2.2 Congratulations were extended to Marlon Bethel and Kenneth Lightbourne on their election to the Supervisory Committee.

17.3 CREDIT COMMITTEE Members were advised that there were three (3)

vacancies on the Credit Committee. The Chairman explained that the two individuals with the highest number of votes will serve for the three (3) year rotation and the individual with the lowest number of votes will serve for one (1) year to complete the

vacancy left by the resignation of Omar Rolle. The nominees were as follows:

1. Elston Bain 2. A. Mary Davis 3. Rudolph Dean 4. Charles Lightbourne 5. Edison Morley

17.3.1 Nominations from the floor:

1. Archelaus Culmer

Nominated by Ms. Shantell Morris-Lockhart, 2nd Kenneth Lightbourne

17.3.2 The nominees were given two minutes to address the members.

Votes:


Elston Bain 77 √

A. Mary Davis 82 √

Rudolph Dean 24

Charles Lightbourne 12

Edwin Morley 46

Archealus Culmer 74 √

17.4 Congratulations were extended to Elston Bain, Archealus Culmer and A. Mary Davis on their election to the Supervisory Committee.

17.4.1 Motion for the ballots to be destroyed was moved by Mr. Nashon Rolle and second by Mr. Dave Beckford. Motion carried unanimously.

18. NOMINATION COMMITTEE

Chairman Rolle stated that in accordance with Section 13 45 (1) (A) of BICCU’s Bye-Laws, at each annual general meeting the membership shall appoint a nomination committee for the following year.

The motion that the Nomination Committee remain the same was moved by Mr. Nashon Rolle, seconded by Mr. Dave Beckford. The AGM unanimously accepted the Nominees.


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19. MOTION FOR ADJOURNMENT

The Motion for the adjournment of the 33rd Annual General Meeting of BICCU was moved by Mr. Nashon Rolle, second by Mr. Dave Beckford

The meeting ended at 9:30 pm.

We hereby certify that the foregoing is a true copy of the minutes and deliberations of the Board of Directors of the Bahama Islands Co-operative Credit Union Limited, held Friday June 28th, 2019.

______________________ _________________________Barry Rolle Estella Walkes-PrattChairman Secretary


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BOARD OF DIRECTORS REPORTTHE BAHAMIAN ECONOMY

In 2019 the Bahamas expected a strengthening of its economy as growth in real gross domestic product (GDP) was projected at 2.1 percent. The growth rate decelerated to .9 percent when compared to the 1.6 percent GDP growth of 2018. The modest growth rate was due to the increased activity in the tourism industry but adversely affected by the passage of Hurricane Dorian in September 2019. The Bahamas recorded 7.2 million visitors to the country during 2019, which was the highest ever recorded visitor arrivals for a year. The destruction caused by Hurricane Dorian slowed the country’s economic growth, especially in Grand Bahama and Abaco, the nation’s second and third largest island economies.

At the beginning of 2020, the country saw a gradual recovery as tourism to the other islands not affected by Hurricane Dorian saw an uptick relative to the fourth quarter 2019. For the most part, a mild economic contraction was still being projected for 2020, but some growth was expected once the infrastructure and tourism capacity was rebuilt. This gradual recovery from the severe damage caused by Hurricane Dorian was being felt when the global outbreak of COVID-19 happened. The outbreak has devastated our tourism-dependent economy.

It is always important to present the status of the Bahamian economy, as it is heavily influenced by the performance of the tourism sector. BICCU’s membership is still mostly hospitality industry centric and its success is also heavily influenced by that sector. As we deliver our report to you, we will try to let you know what we have done in 2019 and 2020 as it relates to our operation and the services provided as well as the impact of the pandemic on the credit union. We continue to work with management to ensure that BICCU delivers quality products and services and remain viable during these tough times.

OPERATIONS

OverviewBICCU continues experiencing a challenge with increasing its loan portfolio and with eliminating non-performing loans from its operation. Competition in the lending business is fierce, with the continued growth in different types of lending agencies. The pandemic has now brought on a different challenge in that many of our members are either furloughed or have become unemployed because of the COVID-19 outbreak. We the members of the Board, along with the management of BICCU have reviewed and taken steps to address all the concerns relating to our operation.

The Board recognizes that our operation has come under increased scrutiny due to the fact that our membership is heavily concentrated in the hospitality sector, which has been hit hard due to pandemic. We received guidance from the Central Bank of the Bahamas as our Regulator, and we have accepted those guidance points to ensure that we are protecting the assets of the credit union.

We have also made decisions that are in line with the worldwide credit union motto of “people helping people”. Accordingly, we have initiated ways to help people during difficult situations.

LoansFor the year ended December 31st, 2019, the Credit Union granted two thousand two hundred and ninety-nine (2,299) loans totaling twelve million four hundred and sixty-nine thousand nine hundred dollars ($12,469,900). The loans payoff/payments for the year totaled ten million seven hundred and twenty-one thousand seven hundred and eighty-five dollars ($10,721,785). For the year ending December 31st, 2019, the loan portfolio had a net increase of


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one million seven hundred and forty-eight thousand one hundred and fifteen dollars ($1,748,115). Our total loans portfolio as of December 31st, 2018, totaled $24,802,381 compared to December 31st, 2019 total of $26,550,496 which is an increase of 7.05 percent. The 7.05 percent growth in the loan portfolio in 2019 was excellent and it meant that gross loans kept pace with the growth in member deposits of 6 percent over the same period.

The Board took several steps to aid members who needed loans. After the passing of Hurricane Dorian, the Board allowed lower rates on loans for members who wanted to assist their families in Grand Bahama and or Abaco. The same privilege was also extended to members in Nassau that experienced flooding damage. As it was done in the latter part of 2018, the Board also reduced the interest rate on several consumer related loans by one (1) percent and by two (2) percent for new mortgage and car loans at the end of 2019. Although the original loan rates were reinstated in 2020, we continued monitoring to aid in the strengthening of the portfolio. During the 2019 Christmas season, the Board and management created a $1,000 loan promotion. This $1,000 loan was available to all members with current loans that were in good standing and there was a relaxation of terms such as exposure and debt service ratio for all members participating. Additionally, at the beginning of the COVID-19 pandemic, BICCU made available to all loan members that were in good standing with the credit union prior to being furloughed from work, a cash give- away equivalent to one month’s loan payment. With the approval of the Central Bank, loan payments have also been deferred through the end of year for furloughed workers. Non-Performing LoansThe Board continues to ensure that management gives special attention to the reduction of delinquent or non-performing loan accounts. We have also placed an emphasis on the recovery of charged off loans. We did not see the results that we would have liked to see regarding a reduction in provisioning and in accounts written off but there was a slight increase in recoveries. Provisioning for loan impairment increase from $471,657 at December 2018 to $1,057,625 at the end of December 2019. Delinquent accounts written off also increased from $635,653 at December 2018 to $882,680 at the end of December 2019, while recoveries of written off accounts increased to $200,427 for 2019 compared to $138,674 during 2018.


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As mentioned last AGM, the credit union needed to adapt to IFRS 9, which we said, would increase the level of loan impairment provisioning. An additional $557,290 was the effect of applying IFRS 9 to our allowance for doubtful loans. The impact for 2020 is expected to be even more significant, as we have crossed into uncharted territory with the deferrals of loan payments for furloughed workers. The Central Bank has provided some guidance on how to treat these loans at the end of the year.

Membership During the year 2019, BICCU gain six hundred and eighty-one (681) members, net. This was a 9.6 percent increase in our membership for the year.

From the end of the year December 2016, BICCU has experienced a 22 percent net increase in its membership. By the end of 2020, BICCU is expected to cross or be close to 8,000 members. We have seen continued interest in new members joining the credit union, even thru the pandemic.

ServicesLast AGM we reported about the issues that we were experiencing relating to the installation of the Automated Teller Machine (ATM). Post installation, the ATM continued to be a problem for the members and the credit union as the machine constantly would be inoperable. After many discussions and troubleshooting with Fidelity Bank and Bahamas Business Solutions a decision was made to replace the installed ATM. At the beginning of the Summer of this year Bahamas Business Solutions installed a new ATM without cost to BICCU. Although the new machine goes down intermittently, it is by no way as problematic as before and the members can withdraw funds without coming into the credit union.

The credit union is launching its mobile banking app to keep up to date with technology. This is a move to upgrade the current “internet teller” home banking system. We will gradually phase out the internet teller. The new mobile banking app present our members with the capability to use a home computer, laptop, or a mobile phone to view balances and transactions and to receive an e-statement of your holdings. We will eventually allow members to transfer funds between accounts and possibly give you the opportunity to start an application for loans before coming into the credit union.


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The credit union is actively intent on upgrading the way we process loans and has partnered with an entity to bring on stream a new loan origination system. The introduction of this system should allow for faster approval of loans. The system will consider a person’s credit score, which is made up of many different factors to determine whether a person qualifies for a loan. Once the application is entered in the system, the individual with approval rights will be to determine that the applicant has met the requirements and an approval decision can be rendered. This system will work hand in hand with the core system as approved loans will also automatically be updated to the members’ account. This system will also be able to give updated information to the newly formed Bahamas Credit Bureau. StaffFor the most part, BICCU staff remained stable during 2019 through 2020. The senior leadership in the credit union remained unchanged. There were some changes that took place at a few junior positions, but nothing that interrupted the flow of work.

The credit union hired a contractual worker to assist with recovery of written off delinquent accounts. That individual was successful in bringing in more than twenty-five (25) thousand dollars a month during his tenure with the credit union. Unfortunately, the COVID-19 pandemic resulted in BICCU having to let that individual go, as not many persons were unable to pay on their delinquent accounts. Additionally, the credit union hired a contractual person to render assistance on the outstanding reconciling items on the bank account. The reconciliation of the main bank account has been problematic since the 2017 and 2018 upheaval of Accounts Department staff. We are of the opinion that the contractual individual has aided in bringing some resolution to this issue.

CENTRAL BANK SUPERVISION & REGULATORY MATTERS

The Central Bank of The Bahamas in their role as Regulator has maintained an active oversight of the credit union’s activities. At the end of June 2020, they commenced an On-site examination of BICCU. The Examination’s objectives were to review and assess the credit union’s: 1) Board structure and its oversight of the diversified functions reporting to them, 2) oversight and internal control processes, 3) money laundering, terrorist, and proliferation financing risk management program and 4) credit risk program. The examination was later extended to include COVID-19 contingency planning and the 2020 Auditor’s report. The examination pointed out that there is a need to have a comprehensive review of BICCU’s policies and procedures in order to approach things from a risk-based perspective and to align the operations with the bye-laws and credit union 2015 Regulations. The Board fully understands this approach, as several senior managers embarked on risk-based training earlier in the year. We expect to see some implementation of the risk-based approach and an alignment of our policies and procedures with the bye-laws and Regulations in 2021.

The credit union has been placed in a vulnerable position because of COVID-19. The fact that our membership base is highly concentrated on the hospitality sector and the majority of hotels and related business have been closed during the pandemic means that BICCU’s operation has been affected negatively. The Central Bank is aware of our situation and have expressed concern about the long-term impact should hotels not re-open. As a result, BICCU has reported monthly to them on the status of the deferred loans. As it stands, more than sixty percent of the loan portfolio has been allowed to defer monthly loan payments through the end of year. The deferred payments only relate to furloughed employees. If it is known that an individual member has been terminated their loan reverts to the active delinquent status if no payments are being received.

The Central Bank also paid attention to the 2019 Audit where BICCU received a Qualified Opinion based on unidentified items on the main bank account reconciliation. The Board has placed an emphasis on rectifying this issue that dates to 2017 and 2018 when there were staffing issues in the Accounts department. The Central Bank has mandated that the matter be resolved before December 2020. As noted earlier, a contractual consultant with familiarity of the system has assisted in trying to resolve this issue. We are confident that management will satisfactorily address this situation so that it will not be a recurring issue on the 2020 Audit of BICCU’s records.


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The Central Bank of the Bahamas has sanctioned CRIF Information Services Bahamas Limited to operate the credit bureau. The process of getting ready for them has already began. We are working with a service provider to automatically make the data available for transfer as required. It is believed that this system will become operational in 2021.

The credit union as with all Supervised Financial Institutions (SFIs) are constantly providing information on its operation to the Central Bank of the Bahamas. The Annual Risk Assessment and Hurricane Preparedness documents are time consuming to prepare, but aid in helping management address weaknesses in the operation.

BICCU’s PROPERTIES

The Saunders Beach property continues to receive many enquiries and several offers, but no offers have been received that has met the satisfaction of the Board. The Village Road property is still being leased to a government agency and remains available for sale should a legitimate offer be made.

BICCU is not in the real estate business, but the Board will make decisions for the betterment of the credit union and our members.

TRAINING

Board of DirectorsJuly 2019 World Credit Union Conference (Nassau)February 2020 Anti-Money Laundering & Counter Financing Terrorism (Nassau)July 2020 Virtual Credit Union Leadership Convention

Supervisory, Education & Credit CommitteesFebruary 2020 Anti-Money Laundering & Counter Financing Terrorism (Nassau) StaffJune 2019 C.U. Jamboree & Staff Empowerment (Nassau) July 2019 World Credit Union Conference (Nassau)November 2019 Enterprise Risk & Information Security Workshop (Nassau)January 2020 Enterprise Risk Management Strategy & Certification (Nassau)February 2020 Anti-Money Laundering & Counter Financing Terrorism (Nassau)March 2020 Police Safety Training (Nassau) June 2020 Payment Card Industry Training (Nassau)July 2020 Credit & Collections Course (Nassau)September 2020 HomeCU Mobile App Virtual TrainingNovember 2020 BICA Accountants Week (Nassau)

Thank You

The Board takes this opportunity to thank the membership for the opportunity to serve and for their continued confidence and support.

__________________________ ______________________________Barry Rolle Estella Walkes-PrattChairman Secretary


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Bahama Islands Co-operative Credit Union Limited

TREASURER’S REPORT2019

BALANCE SHEET

The Treasurer of the Bahama Islands Co-operative Credit Union (BICCU) reports that 2019 has been another year where our credit union has experienced a growth in assets. Our total assets have passed the $50 million milestone and stood at $50,299,708 at the end of December 2019. That represented a 4% growth over December 2018 total assets figure of $48,183,826. From December 2015 to the end of December 2019, BICCU has seen a growth of 56% in its total assets.

There was marginal growth in both the member deposits and the loan portfolio over the year. The Board recognized that member loans were not growing as fast as member deposits were growing and therefore reduced rates on member deposits and placed a moratorium on deposits from new members.

At the end of December 2019, the total member deposits in the Credit Union were $42,081,204. When compared to the balance as of December 2018 of $39,690,731, it represented a growth of 6%.

2019


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Our net loans portfolio grew at a rate of 4% when comparing December 2019 to December 2018. The Board and management continued with the efforts to increase the loan portfolio, through loan & mortgage promotions where rates were lowered with the intent of writing more loans. Although there were some positive results, the loan growth rate is still being outpaced by the member deposit growth rate.


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INCOME STATEMENT

BICCU recorded a profit of $418,197 for the year ending December 31st, 2019. This was an increase of $181,461 or approximately 77% when comparing it to the previous year. The Board and management continue placing an emphasis on profitability to ensure sustainability.

The increased profit was recorded even though the credit union had net loan losses reported in the profit and loss of $857,198 in 2019 as compared to $332,983 in 2018. The 2019 loan impairment provisioning expense of $1,057,625 which included the effect of the application of IFRS 9 amount of $557,290 was more than the 2018 figure of $471,657. On the other hand, recoveries on written off loans increased by $61,753 when comparing the $200,427 recorded in 2019 against $136,674 recorded in 2018.

Interest Income increased over the prior year by $256,171 partly because of placing the emphasis on adding more loans on the books. Interest Expense decreased by an amount of $106,573. This is mostly attributable to placing the moratorium on new member fixed deposits and reducing the interest rates on member deposits.

We will continue to monitor our non-interest income and operating expense lines to ensure that they are kept in line with our expectations.

The way forward….

The Board understands the need for BICCU to remain a viable entity, so we will continue to push for adding quality loans to the books, making sound investment decisions, controlling delinquencies and maintaining control of our operating expenses.

We continue “striving to make a difference because members matter”.

__________________________ ______________________Angela Culmer-Hinsey Mark BullardTreasurer Assistant Treasurer


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BICCU ANNUAL GENERAL MEEING2020

33


FINANCIAL STATEMENTS

31 DECEMBER 2019


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Contents Page

Report of the Auditors 1-3

Appendix to the Auditors’ Report 4

Statement of Financial Position 5

Statement of Profit or Loss and Other Comprehensive Income 6

Statement of Changes in Equity 7

Statement of Cash Flows 8

Notes to the Financial Statements 9 – 53

35

38

39

40

41

42

43


35


36


37


38

4

APPENDIX TO THE AUDITORS’ REPORT

Detailed Description of Our ResponsibilitiesAs part of an audit in accordance with ISAs, we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

· Identify and assess the risk of material misstatement of the financial statements,whether due to fraud or error, design and perform audit procedures responsiveto those risks, and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error, as fraud mayinvolve collusion, forgery, intentional omissions, misrepresentations, or theoverride of internal control.

· Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances, but not forthe purpose of expressing an opinion on the effectiveness of the Credit Union’sinternal control.

· Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

· Conclude on the appropriateness of management’s use of the going concern basisof accounting and, based on the audit evidence obtained, whether a materialuncertainty exists related to events or conditions that may cast significant doubton the Credit Union’s ability to continue as a going concern. If we conclude thata material uncertainty exists, we are required to draw attention in our auditor’sreport to the related disclosures in the financial statements or, if suchdisclosures are inadequate, to modify our opinion. Our conclusions are based onthe audit evidence obtained up to the date of our auditor’s report. However,future events or conditions may cause the Credit Union to cease to continue as agoing concern.

· Evaluate the overall presentation, structure and content of the financialstatements, including the disclosures, and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

We communicate with those charged with governance regarding, among other matters,the planned scope and timing of the audit and significant audit findings, including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence, and to communicate withthem all relationships and other matters that may reasonably be thought to bear on ourindependence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determinethose matters that were of most significance in the audit of the financial statements ofthe current period and are therefore the key audit matters. We describe these mattersin our auditor’s report unless law or regulation precludes public disclosure about thematter or when, in extremely rare circumstances, we determine that a matter shouldnot be communicated in our report because the adverse consequences of doing so wouldreasonably be expected to outweigh the public interest benefits of such communication.


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The notes on pages 43 to 87 form an integral part of these financial statements.


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6


STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2019

Note 2019 2018$ $

FINANCE INCOMELoan interest income 16 2,864,486 2,668,554

Investment interest income 16 308,769 248,530

3,173,255 2,917,084FINANCE COST Deposit interest expense 16 1,078,160 1,172,961

Borrowings 16 101,157 112,929

1,179,317 1,285,890NET FINANCE INCOME BEFORE PROVISION FOR LOAN LOSSES 1,993,938 1,631,194 Provision for loan losses 9 (857,198) (332,983)

NET FINANCE INCOME 1,136,740 1,298,211Non-interest income 17 1,448,079 1,089,968

2,584,819 2,388,179OPERATING EXPENSES Personnel 18 924,682 759,495

Organisational 19 231,367 231,213 General business 20 219,261 329,654

Occupancy 21 331,082 361,322 Members’ security 22 330,209 339,336

Computer expense 23 91,374 80,805 Marketing 24 38,647 49,618

2,166,622 2,151,443

NET INCOME FOR THE YEAR 418,197 236,736

OTHER COMPREHENSIVE INCOME/(LOSS)Fair value gain/(loss) on investments 2,180 (16,830)

TOTAL COMPREHENSIVE INCOME $420,377 $219,906====== ======


7BAHAMA ISLANDS CO-OPERATIVE CREDIT UNION LIMITED

STATEMENT OF CHANGES IN EQUITY


Qualifying Statutory Fair value Donated Retained shares reserve fund reserve capital earnings Total $ $ $ $ $ $

1 January 2018 1,250,800 3,020,218 110,480 -- 832,159 5,213,657

Comprehensive income Net income for the year -- -- -- -- 236,736 236,736 Other comprehensive loss -- -- (16,830) -- -- (16,830) -- -- (16,830) -- 236,736 219,906Transactions with owners Net shares issued during the year 167,000 -- -- -- -- 167,000 Dividends on qualifying shares -- -- -- -- (99,056) (99,056) 167,000 -- -- -- (99,056) 67,944Transfer between reserves Statutory reserve -- 240,929 -- -- (240,929) --31 December 2018 1,417,800 3,261,147 93,650 -- 728,910 5,501,507Effect of IFRS 9 adoption (Note 9) -- -- -- -- (557,290) (557,290)31 December 2018, as restated 1,417,800 3,261,147 93,650 -- 171,620 4,944,217

Comprehensive income Net income for the year -- -- -- -- 418,197 418,197 Other comprehensive income -- -- 2,180 -- -- 2,180 -- -- 2,180 -- 418,197 420,377Transactions with owners Net shares issued during the year 136,000 -- -- 7,400 -- 143,400 Dividends on qualifying shares -- -- -- -- (56,128) (56,128) 136,000 -- -- 7,400 (56,128) 87,272Transfer between reservesStatutory reserve -- 104,528 -- -- (104,528) --

31 December 2019 $1,553,800 $3,365,675 $95,830 $7,400 $429,161 $5,451,866 ======= ======= ===== ==== ====== =======




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7BAHAMA ISLANDS CO-OPERATIVE CREDIT UNION LIMITED

STATEMENT OF CHANGES IN EQUITY


Qualifying Statutory Fair value Donated Retained shares reserve fund reserve capital earnings Total $ $ $ $ $ $

1 January 2018 1,250,800 3,020,218 110,480 -- 832,159 5,213,657

Comprehensive income Net income for the year -- -- -- -- 236,736 236,736 Other comprehensive loss -- -- (16,830) -- -- (16,830) -- -- (16,830) -- 236,736 219,906Transactions with owners Net shares issued during the year 167,000 -- -- -- -- 167,000 Dividends on qualifying shares -- -- -- -- (99,056) (99,056) 167,000 -- -- -- (99,056) 67,944Transfer between reserves Statutory reserve -- 240,929 -- -- (240,929) --31 December 2018 1,417,800 3,261,147 93,650 -- 728,910 5,501,507Effect of IFRS 9 adoption (Note 9) -- -- -- -- (557,290) (557,290)31 December 2018, as restated 1,417,800 3,261,147 93,650 -- 171,620 4,944,217

Comprehensive income Net income for the year -- -- -- -- 418,197 418,197 Other comprehensive income -- -- 2,180 -- -- 2,180 -- -- 2,180 -- 418,197 420,377Transactions with owners Net shares issued during the year 136,000 -- -- 7,400 -- 143,400 Dividends on qualifying shares -- -- -- -- (56,128) (56,128) 136,000 -- -- 7,400 (56,128) 87,272Transfer between reservesStatutory reserve -- 104,528 -- -- (104,528) --

31 December 2019 $1,553,800 $3,365,675 $95,830 $7,400 $429,161 $5,451,866 ======= ======= ===== ==== ====== =======




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STATEMENT OF CASH FLOWS


2019 2018$ $

CASH FLOWS FROM OPERATING ACTIVITIESNet income for the year 418,197 236,736Adjustment for items not involving the movement of cash:

Interest income (3,147,772) (2,917,084)Interest expense 1,179,317 1,285,890

Depreciation 156,009 190,263Gain on disposal of property and equipment -- (800)

Provision for loan losses 1,057,625 471,657Operating loss before working capital changes (336,624) (733,338)

Increase in loans receivable (2,627,977) (2,361,068)Increase in other receivables and prepayments (110,905) (338,728)

Increase in members’ shares and other deposits 2,390,473 5,563,827Increase in accounts payable and accrued expenses 69,132 214,876

Interest received 3,147,772 2,844,914Interest paid (1,179,317) (1,213,720)

Net cash provided by operating activities 1,352,554 3,976,763

CASH FLOWS FROM INVESTING ACTIVITIESIncrease in deposits with banks and other institutions (97,237) (2,053,975)

Increase in deposits with League (843,948) (1,244,511)Proceeds from disposal of financial investments -- 250,000

Acquisition of financial investments -- (500,000)Acquisition of shares in the League (1,700) (800)

Purchase of investment property -- (39,771)Purchase of property and equipment (85,948) (84,577)

Proceeds from disposal of property and equipment -- 800Net cash used by investing activities (1,028,833) (3,672,834)

CASH FLOWS FROM FINANCING ACTIVITIESBorrowings paid (294,082) (336,790)Redemption of members’ shares -- (39,400)Issuance of members’ shares 143,400 206,400

Dividends paid on members’ shares (56,128) (99,056)Net cash used by financing activities (206,810) (268,846)

Net increase in cash and cash equivalents 116,911 35,083Cash and cash equivalents at beginning of the year 2,809,708 2,774,625

Cash and cash equivalents at end of the year $2,926,619 $2,809,708======= =======

The notes on pages 9 to 53 form an integral part of these financial statements.The notes on pages 43 to 87 form an integral part of these financial statements.


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NOTES TO THE FINANCIAL STATEMENTS


1. INCORPORATION AND ACTIVITIES

Bahama Islands Co-operative Credit Union Limited (Formerly Bahama Islands Resorts andCasinos Cooperative Credit Union Limited) (“BICCU”) (the “Credit Union”) was registeredon 28 May 1986 under the provisions of the Commonwealth of The Bahamas Co-operativeSocieties Act, 2005 (the “Act”), and subsequently became a registered member of TheBahamas Co-operative League Limited (the “League”). The Credit Union changed its nameon August 20, 2014.

Membership, which includes persons not less than 16 years of age, consist of all personsemployed in The Bahamas, all past and present employees of the Credit Union who weremembers of the Credit Union at the time of their separation, and all former members of theQueens College Co-operative Credit Union Limited. The spouses, children, parents andsiblings of all of the aforementioned members are also eligible to become members of theCredit Union.

The principal objectives of the Credit Union are as follows:

a) To promote the economic interests of its members in accordance with co-operative principles;

b) To promote thrift among its members by affording them an opportunity toaccumulate their savings; and

c) To create a source of credit to members for provident and productive purposes.

The Credit Union’s registered office is located at Rosetta & Patton Streets, Nassau, TheBahamas.

2. BASIS OF PREPARATION

These financial statements are prepared on a going concern basis and in accordance withInternational Financial Reporting Standards (IFRS). The financial statements have also beenprepared under the historical cost convention as modified by the revaluation of financialassets at FVOCI.

The preparation of the financial statements in conformity with IFRS requires management tomake estimates and assumptions that affect the reported amounts of assets and liabilities andthe disclosure of contingent assets and liabilities at the date of the financial statements andreported amounts of revenue and expenses during the year. Actual results can differ fromthose estimates.


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3. ACCOUNTING POLICIES

Cash and cash equivalents

Cash and cash equivalents are comprised of cash in banks and short-term highly liquidinvestments that are readily convertible into known amounts of cash and are subject to aninsignificant risk of change in value.

Fixed deposits

Fixed deposits represent deposit at banks with original maturities of more than 90 days.These deposits are recognised in the statement of financial position at amortised cost usingthe effective interest method.

Investment properties

Investment properties consist of properties that are held to earn rentals and/or for capitalappreciation and are not occupied by the Credit Union. Investment properties are measuredinitially and subsequently at cost, including transaction costs. The carrying amount includesthe cost of replacing part of an existing investment property at the time that cost is incurredif the recognition criteria are met, and excludes the costs of day-to-day servicing of aninvestment property.

Depreciation is recognised in the statement of profit or loss and other comprehensiveincome on the straight-line basis at rates estimated to write-off the relevant assets over theirexpected useful lives. Land is not depreciated, and buildings is depreciated at 4% perannum.

Property and equipment

Property and equipment are stated at cost less accumulated depreciation. Costs includeexpenditures that are directly related to the acquisition of the asset. Depreciation is recordedon the straight-line basis over the following estimated useful lives of the respective assets:

Buildings 25 yearsFurniture and equipment 3 to 10 yearsComputer hardware and software 3 to 10 yearsAutomated Teller Machine 7 yearsAutomobiles 5 years

Expenses incurred after the fixed assets have been put into operation, such as repairs andmaintenance, are normally charged to income in the period when the costs are incurred.


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3. ACCOUNTING POLICIES (cont)

Property and equipment (cont)

In a situation where it can be clearly demonstrated that the expenditures have resulted in anincrease in the future economic benefits expected to be obtained from the use of an item offixed assets beyond its originally assessed standard of performance, the expenditures arecapitalised as an addition to the cost of fixed assets.

When assets are retired or otherwise disposed of, the costs and related accumulateddepreciation and amortisation are removed from the accounts and any resulting gain or lossis credited or charged to operations.

Financial assets and financial liabilities

Recognition and initial measurement

All financial assets and financial liabilities are recognised on the trade date, which is thedate on which the Credit Union becomes a party to the contractual provisions of theinstrument.

A financial asset or financial liability is measured initially at fair value plus, for an itemnot at FVTPL, transaction costs that are directly attributable to its acquisition or issue.

Financial assets - classification and subsequent measurement

On initial recognition, a financial asset is classified as measured at: amortised cost, fairvalue through other comprehensive income (FVOCI) or fair value through profit or loss(FVTPL).

A financial asset is measured at amortised cost if it meets both of the followingconditions and is not designated as at FVTPL:

– it is held within a business model whose objective is to hold assets to collectcontractual cash flows; and

– its contractual terms give rise on specified dates to cash flows that are SolelyPayments of Principal and Interest (“SPPI”)

The Credit Union’s financial assets measured at amortised cost include cash and cashequivalents, deposits with banks and other institutions, deposits with the League, otherreceivables and prepayments and loans receivable. The Credit Union’s investments inBahamas Government Registered Stock are measured at amortised cost. These financialassets are held to collect contractual cash flows.


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Financial assets and financial liabilities (cont)

Financial assets classification and subsequent measurement (cont)

A debt instrument is measured at FVOCI only if it meets both of the following conditionsand is not designated as at FVTPL:

– the asset is held within a business model whose objective is achieved by bothcollecting contractual cash flows and selling financial assets; and

– the contractual terms of the financial asset give rise on specified dates to cashflows that are SPPI.

On initial recognition of an equity investment that is not held for trading, the CreditUnion may irrevocably elect to present subsequent changes in fair value through OCI.This election is made on an investment-by-investment basis.

The Credit Union’s financial assets measured at FVOCI include investments inmarketable securities which are held to earn interest and gains on sale. Investments inequities were irrevocably designated to be measured at FVOCI.

The Credit Union does not have financial assets measured at FVTPL during the year.

Financial liabilities – classification and subsequent measurement

Financial liabilities are classified as measured at amortised cost or FVTPL.

A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is aderivative or it is designated as such on initial recognition. Financial liabilities at FVTPLare measured at fair value and net gains and losses, including any interest expense arerecognised in profit or loss.

Other financial liabilities are subsequently measured at amortised cost using the effectiveinterest method. Interest expense and foreign exchange gains and losses are recognised inprofit or loss. Any gain or loss on derecognition is also recognised in profit or loss.

Financial liabilities at FVTPL:

- The Credit Union does not have financial liabilities measured at FVTPL.

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Financial liabilities – classification and subsequent measurement (cont)

Financial liabilities at amortised cost:

- The Credit Union’s financial liabilities include accounts payable and accruedexpenses, member’s shares and other deposits and borrowings which aremeasured subsequently at amortised cost using the effective interest rate method.Discounting, however, is omitted where the effect of discounting is immaterial.

Impairment of assets

The Credit Union recognises loss allowances for Expected Credit Losses (“ECLs”) onfinancial assets measured at amortised cost.

The Company measures loss allowances at an amount equal to lifetime ECLs, except for thefollowing, which are measured at 12-month ECLs:

– financial assets that are determined to have low credit risk at the reporting date; and– other financial assets for which credit risk (i.e. the risk of default occurring over the

expected life of the asset) has not increased significantly since initial recognition.

Lifetime ECLs are the ECLs that result from all possible default events over the expectedlife of a financial instrument.

12-month ECLs are the portion of ECLs that result from default events that are possiblewithin the 12 months after the reporting date (or a shorter period if the expected life of theinstrument is less than 12 months).

At each reporting date, the Credit Union assesses whether financial assets carried atamortised cost are credit-impaired. A financial asset is ‘credit-impaired’ when one or moreevents that have a detrimental impact on the estimated future cash flows of the financialasset have occurred.

Loss allowances for financial assets measured at amortised cost are deducted from the grosscarrying amount of the assets.


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Financial liabilities – classification and subsequent measurement (cont)

Financial liabilities at amortised cost:

- The Credit Union’s financial liabilities include accounts payable and accruedexpenses, member’s shares and other deposits and borrowings which aremeasured subsequently at amortised cost using the effective interest rate method.Discounting, however, is omitted where the effect of discounting is immaterial.

Impairment of assets

The Credit Union recognises loss allowances for Expected Credit Losses (“ECLs”) onfinancial assets measured at amortised cost.

The Company measures loss allowances at an amount equal to lifetime ECLs, except for thefollowing, which are measured at 12-month ECLs:

– financial assets that are determined to have low credit risk at the reporting date; and– other financial assets for which credit risk (i.e. the risk of default occurring over the

expected life of the asset) has not increased significantly since initial recognition.

Lifetime ECLs are the ECLs that result from all possible default events over the expectedlife of a financial instrument.

12-month ECLs are the portion of ECLs that result from default events that are possiblewithin the 12 months after the reporting date (or a shorter period if the expected life of theinstrument is less than 12 months).

At each reporting date, the Credit Union assesses whether financial assets carried atamortised cost are credit-impaired. A financial asset is ‘credit-impaired’ when one or moreevents that have a detrimental impact on the estimated future cash flows of the financialasset have occurred.

Loss allowances for financial assets measured at amortised cost are deducted from the grosscarrying amount of the assets.


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Derecognition

The Credit Union derecognises a financial asset when the contractual rights to the cashflows from the asset expire, or it transfers the rights to receive the contractual cash flows in atransaction in which substantially all of the risks and rewards of ownership of the financialasset are transferred or in which the Credit Union neither transfers nor retains substantiallyall of the risks and rewards of ownership and does not retain control of the financial asset.

Members’ equity

Qualifying shares are the minimum shares required to become a member of the CreditUnion as described in the Credit Union’s Bye-Laws. Each member of the Credit Union isrequired to own a minimum of 40 shares with a value of $5 each. These shares entitled eachmember to 1 vote at the Annual General Meeting.

As approved in June 2019 by the members of the Credit Union, the practice of allowing thewithdrawal of Qualifying shares was ceased.

IFRIC 2 – Members’ Shares in Co-operative Entities and Similar Instruments requires thatthe voluntary shares be classified as liabilities and that the dividends paid on these shares beclassified as an expense, where there is no unconditional right of the Credit Union to refuseredemption, whether through legislation or through the Credit Union’s own rules. Inprevious years, members of the Credit Union with no outstanding obligations due to theCredit Union can withdraw their qualifying shares upon request.

Statutory reserve fund is set up in accordance with the provisions of the Act. The proceedsof this reserve are to be deposited with the League.

Dividends on qualifying shares are recognised in equity in the period in which they aredeclared by the Credit Union’s Directors. Further, the payment of dividends is subject to theapproval of members at the Annual General Meeting.

Revenue and expenses recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow tothe Credit Union and the revenue can be reliably measured. Revenue is recognised whenearned and expenses are recognised when incurred on an accrual basis.


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Revenue and expenses recognition (cont)

Interest income and expense

Interest income and expense are recognised in the statement of profit or loss and othercomprehensive income using the effective interest rate method. The effective interest rate isthe rate that discounts the estimated future cash payments and receipts through the expectedlife of the financial asset or liability (or, where appropriate, a shorter period) to the carryingamount of the financial asset or liability. The effective interest rate is established on initialrecognition of the financial asset and liability and is not revised subsequently.

The Credit Union ceases to accrue interest on loans past due for 90 days or more.

Fees and other income

Fees and other income are recognised on the accrual basis. Loan origination fees arerecognised over the life of the loan, as an adjustment to the effective yield on the loans.Performance linked fees or fee components are recognised when the performance criteriaare fulfilled.

Operating expenses

Operating expenses are recognised on the accrual basis in the statement of profit or loss andother comprehensive income.

Leases

The Credit Union as Lessor

Rental income from operating leases is recognised on a straight-line basis over the term ofthe relevant lease period and services provided as agreed in the rent agreement.

Defined contribution plan

A defined contribution plan is a post-employment benefit plan under which the CreditUnion pays fixed contributions into a separate entity and has no legal or constructiveobligation to pay further amounts. Obligations for contributions to the defined contributionplan are recognised as an expense in the statement of profit or loss and other comprehensiveincome in the periods during which services are rendered by employees.


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Defined contribution plan (cont)

The employee contributes 5% to 6% of their salary each month to the Pension Plan which ismatched by the Credit Union. The employees’ participation in the plan is voluntary.

The Credit Union’s contributions vest as follows:

Years of service Vested %Less than 1 year 0%1 year but less than 2 years 20%2 years but less than 3 years 40%3 years but less than 4 years 60%4 years but less than 5 years 80%5 years or more 100%

4. NEW AND AMENDED STANDARDS

The Credit Union has adopted the following new and revised Standards and Interpretationsissued by the International Accounting Standards Board (“IASB”) and the InternationalFinancial Reporting Interpretations Committee (“IFRIC”) of the IASB that are relevant tothe Credit Union’s operations and effective for the current accounting period.

IFRS 9 (issued November 2009 and amended October 2010 and July 2014)

This standard amends the requirements for classification and measurement of financialassets. The available-for-sale and held-to-maturity categories of financial assets in IAS 39have been eliminated.

Under IFRS 9, there are three categories of financial assets:· Amortised cost· Fair value through profit or loss· Fair value through other comprehensive income

IFRS 9 also requires that gains or losses on financial liabilities measured at fair value berecognised in profit or loss, except that the effects of changes in the fair value of a financialliability that is designated at fair value through profit or loss (using the fair value option) thatrelate to changes in the reporting entity’s own credit risk are normally recognised in othercomprehensive income.


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4. NEW AND AMENDED STANDARDS (cont)

IFRS 9 (cont)

The changes are to be applied prospectively from the date of adoption. The effective date ofthe amendments is 1 January 2018 however, the Central Bank of the Bahamas has approvedthe deferral of the adoption of IFRS 9 to all credit unions until 1 January 2019.

The Credit Union applied the expected credit loss model when calculating impairmentlosses on its financial assets measured at amortised costs. This resulted in increasedimpairment provisions and greater judgement due to the need to factor in forward lookinginformation when estimating the appropriate amount of provisions. As per transitionalprovision of IFRS 9, the comparative periods have not been restated and the effect of theadditional provision on initial application was presented as an adjustment to the beginningretained earnings.

IFRS 16 Leases

IFRS 16 supersedes IAS 17 Leases, IFRIC 4 Determining whether an Arrangement containsa Lease, SIC-15 Operating Leases – Incentives and SIC-27 Evaluating the Substance ofTransactions Involving the Legal Form of a Lease. IFRS 16 contains a single lesseeaccounting model, which eliminates the distinction between operating and finance leasesfrom the perspective of the lessee. All contracts that meet the definition of a lease, other thanshort term leases and leases of low value items for which a lessee has the option not to applythe measurement and presentation requirements of IFRS 16, will be recorded in thestatement of financial position with a “right of use” asset and a corresponding liability. Theasset is subsequently accounted for as property, plant and equipment or investment propertyand the liability is amortized using the interest rate inherent in the lease. For many entitiesthe effect of bringing all leases on the statement of financial position will be very significantand will require careful planning, including for commercial effects.

In the income statement, the application of IFRS 16 will result in a depreciation charge(within operating expenses) and an interest expense.

The accounting requirements from the perspective of the lessor remains largely in line withprevious IAS 17 requirements.

IFRS 16 has an effective date of 1 January 2019, with early application permitted only ifIFRS 15 has also been adopted.


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IFRS 16 Leases (cont)

The adoption of the requirements of IFRS 16 does not have an impact in the financialstatements since the accounting requirements from the perspective of the lessor remainslargely in line with previous IAS 17 requirements.

The following new/amended accounting standards and interpretations have been issued, butare not mandatory for financial years ended 31 December 2019. They have not been adoptedin preparing the financial statements and are expected to affect the entity in the period ofinitial application. In all cases the entity intends to apply these standards from applicationdate as indicated below.

Amendments to IFRS 3 - Definition of a business

The amendments clarify that while businesses usually have outputs, outputs are notrequired for an integrated set of activities and assets to qualify as a business. To beconsidered a business an acquired set of activities and assets must include, at a minimum,an input and a substantive process that together significantly contribute to the ability tocreate outputs.

Additional guidance is provided that helps to determine whether a substantive process hasbeen acquired.

The amendments introduce an optional concentration test that permits a simplifiedassessment of whether an acquired set of activities and assets is not a business. Under theoptional concentration test, the acquired set of activities and assets is not a business ifsubstantially all of the fair value of the gross assets acquired is concentrated in a singleidentifiable asset or group of similar assets.

The amendments are applied prospectively to all business combinations and assetacquisitions for which the acquisition date is on or after the first annual reporting periodbeginning on or after 1 January 2020, with early application permitted.

The Credit Union does not expect any significant impact on the financial statements uponthe future adoption of these amendments.


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Amendments to IAS 1 and IAS 8 - Definition of material

The amendments are intended to make the definition of material in IAS 1 easier tounderstand and are not intended to alter the underlying concept of materiality in IFRSStandards. The concept of ‘obscuring’ material information with immaterial informationhas been included as part of the new definition.

The threshold for materiality influencing users has been changed from ‘could influence’to ‘could reasonably be expected to influence’.

The definition of material in IAS 8 has been replaced by a reference to the definition ofmaterial in IAS 1. In addition, the IASB amended other Standards and the ConceptualFramework that contain a definition of material or refer to the term ‘material’ to ensureconsistency.

The amendments are applied prospectively for annual periods beginning on or after 1January 2020, with earlier application permitted.

The Credit Union does not expect any significant impact on the financial statements uponthe future adoption of these amendments.

5. CASH AND CASH EQUIVALENTS AND OTHER DEPOSITS

a. Cash on hand and in banksRate 2019 Rate 2018

$ $Scotiabank (Bahamas) Limited

Operating account 1,522,674 870,892Call deposit 50,000 50,000Payroll account 12,175 12,674

Fidelity Bank (Bahamas) LimitedBusiness savings 1.25% 425,188 1.25% 1,111,610Business checking 159,222 61,057

RBC Royal Bank (Bahamas) Limited 245,944 702,475 2,415,203 2,808,708Cash on hand and in ATM 511,416 1,000

$2,926,619 $2,809,708 ======= =======


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5. CASH AND CASH EQUIVALENTS AND OTHER DEPOSITS (cont)

The Credit Union maintains a credit line of $50,000 with Scotiabank (Bahamas) Limited.This facility bears interest at Nassau Prime plus 2.5% (effective interest rate of 7.25%)

The facility is secured by the hypothecation of $50,000 of the fixed deposit in Note 5(b).

b. Deposits with banks and other institutions

Rate 2019 Rate 2018 $ $

BAF Financial & Insurance 3.25- 5% 1,761,878 3.25-5% 1,714,724Fidelity Bank (Bahamas) – term deposit 2.50% 2,050,000 2.50% 2,000,000Scotiabank (Bahamas) – term deposit 0.08% 51,664 0.08% 51,581

3,863,542 3,766,305Pledged as security (50,000) (50,000)

$3,813,542 $3,716,305======= =======

BAF Financial & Insurance is an annuity contract with no maturity date but will incur apenalty if surrendered within 3 years. Interest accrues at 5% for the first year and at aminimum guaranteed interest rate of Prime minus 2.2% thereafter.

Fidelity Bank (Bahamas) term deposits has original maturity of three (3) years and matureson 26 September 2021.

Scotiabank (Bahamas) term deposit has an original maturity of one (1) year and matures on14 March 2020 (2018: 14 March 2019), of which $50,000 was pledged as security in Note5(a).


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6. DEPOSITS WITH THE LEAGUE

Rate 2019 Rate 2018$ $

Statutory reserve deposits Balance, beginning 1.44% 4,967,161 1.44% 4,386,405

Additional deposits 350,000 500,000Interest earned 72,971 80,756Balance, ending 5,390,132 4,967,161

Liquidity reserve depositsBalance, beginning 1.44% 4,007,192 1.44% 3,442,675Additional deposits 350,000 500,000

Interest earned 59,151 64,517Balance, ending 4,416,343 4,007,192

Other deposits Balance, beginning 1.00% 100,624 1.00% --

Additional deposits 10,955 100,379Interest earned 871 245Balance, ending 112,450 100,624

$9,918,925 $9,074,977======= =======

Statutory reservesSection 89 (1) of the Bye-Laws requires that annual amounts be transferred from retainedearnings to the statutory reserves, before the payment of dividends. The proceeds of thisreserve are held at the League.

The surplus in the statutory deposits with the League are as follows:

2019 2018$ $

Statutory reserve deposits 5,390,132 4,967,161Requirement (10% of total assets) 5,029,970 4,818,383

$360,162 $148,778====== ======

Statutory reserve deposits shall remain with the League and shall only be withdrawn forpurposes stated in the Act. The actual transfer from the retained earnings to the statutoryreserve of $3,365,675 (2018: $3,261,147) is $2,024,457 (2018: $1,706,014) less than thestatutory reserve deposit with the League of $5,390,132 (2018: $4,967,161).


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6. DEPOSITS WITH THE LEAGUE (cont)

Liquidity reservesSection 65(2)(4) of the Act requires the Credit Union to ensure that not less than 10% of itsmembers deposits are kept in a liquidity reserve deposit and that corresponding amount bedeposited and administered by the League. The surplus in the liquidity reserves are asfollows:

2019 2018$ $

Liquidity reserve deposits 4,416,343 4,007,192Requirement (10% of members’ deposit) 4,208,120 3,969,073

$208,223 $38,119 ====== =====

7. OTHER RECEIVABLES AND PREPAYMENTS2019 2018

$ $Members’ payroll deductions receivable 1,271,116 1,385,034Other receivables 230,132 127,783Outstanding reconciling items 436,731 287,284Prepaid expenses 76,574 45,725Accrued investments income 64,423 64,591Debt collection fees receivable 51,764 51,764ATM installation deposits -- 44,419Refundable security deposits -- 13,235

$2,130,740 $2,019,835======= =======

8. FINANCIAL INVESTMENTS

Financial investments comprised of the following:

2019 2018$ $

Marketable securities 396,165 392,285Bahamas Government Registered Stocks 1,240,000 1,240,000

$1,636,165 $1,632,285======= =======


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8. FINANCIAL INVESTMENTS (cont)

Marketable securitiesThe Credit Union’s investments in securities are ranked into Levels 1 to 3, based on thedegree to which the fair value is observable:

Level 1 - Fair value measures are those derived from quoted prices (unadjusted) in activemarkets for identical assets or liabilities.

Level 2 - Fair value measurements are those derived from inputs other than quoted pricesincluded within Level 1 that are observable for the asset or liability, either directly (i.e., asprices) or indirectly (i.e., derived from prices).

Level 3 - Fair value measurements are those derived from valuation techniques that includeinputs for the asset or liability that are not based on observable market data (unobservableinputs).

Fair Value LevelLevel 1 Level 2 Level 3 Total

$ $ $ $2019Marketable securities $360,755 $-- $35,410 $396,165

====== == ===== ======2018Marketable securities $358,575 $-- $33,710 $392,285

====== == ===== ======

Marketable securities are comprised of the following:Number of Market

shares Cost Value$ $

2019Freeport Oil Holdings Company Ltd. 4,000 120 42,480Commonwealth Bank Limited 13,500 90 60,750Fidelity Bank (Bahamas) Limited 500 150 7,525Cable Bahamas Limited (6.75%) 125 125,000 125,000Cable Bahamas Limited (6.25%) 125 125,000 125,000The Bahamas Co-operative League Limited 708 35,410 35,410

$285,770 $396,165====== ======


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8. FINANCIAL INVESTMENTS (cont)

Number of MarketShares Cost Value

$ $2018Freeport Oil Holdings Company Ltd. 4,000 120 41,400Commonwealth Bank Limited 13,500 90 60,750Fidelity Bank (Bahamas) Limited 500 150 6,425Cable Bahamas Limited (6.75%) 125 125,000 125,000Cable Bahamas Limited (6.25%) 125 125,000 125,000The Bahamas Co-operative League Limited 674 33,710 33,710

$284,070 $392,285====== ======

Bahamas Government Registered StocksBahamas Government Registered Stock (BGRS) earned interest during the year at 4.25% to5.00% (2018: 4.25% to 5.00%), and mature as noted below:

Year of maturity 2019 2018$ $

2020 250,000 250,000 2022 100,000 100,0002023 40,000 40,000

2026 350,000 350,0002028 250,000 250,000

2038 250,000 250,000

$1,240,000 $1,240,000 ======= =======


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9. LOANS RECEIVABLE2019 2018

$ $Performing 24,939,499 23,350,170Non-performing 1,610,997 1,452,211

26,550,496 24,802,381Accrued interest 138,749 141,567Less: Allowance for doubtful loans (1,008,683) (276,448)

$25,680,562 $24,667,500======== ========

Summary of changes in the loans receivable:2019 2018

$ $Balance, beginning 24,802,381 23,075,836Loans disbursed during the year 12,469,900 11,992,816Loans paid during the year (10,721,785) (10,266,271)

26,550,496 24,802,381Accrued interest 138,749 141,567

26,689,245 24,943,948Allowance for doubtful loans (1,008,683) (276,448)

Total net loans to members $25,680,562 $24,667,500 ======== ========

Summary of classification of loans receivable is as follows:2019 2018

$ $Consumer 18,814,878 18,075,770Construction and real estate 6,565,831 5,593,718Motor vehicle 1,149,121 1,106,908Business 20,666 25,985

Total net loans to members $26,550,496 $24,802,381======== ========


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9. LOANS RECEIVABLE (cont)

Summary of changes in allowance for doubtful loans:2019 2018

$ $Balance, beginning 276,448 440,444Effect of application of IFRS 9 557,290 --Restated balance 833,738 440,444Increase in provision during the year 1,057,625 471,657Loans written off during the year (882,680) (635,653)

Balance, ending $1,008,683 $276,448======= ======

Provision for the year 1,057,625 471,657Recoveries of bad debts (200,427) (138,674)

Loan losses reported in profit or loss $857,198 $332,983 ====== ======

Loans to members are partially collateralised by the members’ deposits.

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The following is an aged analysis of all loans receivable that were past due as of the date ofthe statement of financial position:

Days inarrears

Number of accounts

Loan balance

Value of security Exposure

Loan loss provision

Provision rate %

$ $ $ $2019Current loans 24,939,499 16,819,122 8,120,377 352,114 4.34%Within 1 month 3 6,651 742 5,909 923 15.62%2 to 3 months 68 333,048 75,683 257,365 91,212 35.44%4 to 6 months 55 219,132 21,800 197,332 102,808 52.10%7 to 12 months 133 633,770 42,730 591,040 461,626 78.10%Over 1 year 10 418,396 418,396 -- -- 100.00%

$26,550,496 $17,378,473 $9,172,023 $1,008,683 ======== ======== ======= =======

Days inarrears

Number of accounts

Delinquent loans


Loan loss provision

Provision rate %

$ $ $ $2018Within 1 month -- -- -- -- -- 0.00%2 to 3 months 27 102,770 25,165 77,605 27,162 35.00%4 to 6 months 65 256,650 22,258 234,392 82,037 35.00%7 to 12 months 133 569,440 91,585 477,855 167,249 35.00%Over 1 year 12 523,351 523,351 -- -- 100.00%

$1,452,211 $662,359 $789,852 $276,448 ======= ====== ====== ======


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The following is an aged analysis of all loans receivable that were past due as of the date ofthe statement of financial position:

Days inarrears

Number of accounts

Loan balance


Loan loss provision

Provision rate %

$ $ $ $2019Current loans 24,939,499 16,819,122 8,120,377 352,114 4.34%Within 1 month 3 6,651 742 5,909 923 15.62%2 to 3 months 68 333,048 75,683 257,365 91,212 35.44%4 to 6 months 55 219,132 21,800 197,332 102,808 52.10%7 to 12 months 133 633,770 42,730 591,040 461,626 78.10%Over 1 year 10 418,396 418,396 -- -- 100.00%

$26,550,496 $17,378,473 $9,172,023 $1,008,683 ======== ======== ======= =======

Days inarrears

Number of accounts

Delinquent loans


Loan loss provision

Provision rate %

$ $ $ $2018Within 1 month -- -- -- -- -- 0.00%2 to 3 months 27 102,770 25,165 77,605 27,162 35.00%4 to 6 months 65 256,650 22,258 234,392 82,037 35.00%7 to 12 months 133 569,440 91,585 477,855 167,249 35.00%Over 1 year 12 523,351 523,351 -- -- 100.00%

$1,452,211 $662,359 $789,852 $276,448 ======= ====== ====== ======


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10. INVESTMENT PROPERTIES

2019Lands Building Total

$ $ $CostBalance, 31 December 2018

and 2019 1,290,480 683,567 1,974,047

Accumulated depreciationBalance, 31 December 2018 -- 517,525 517,525Additions -- 33,687 33,687Balance, 31 December 2019 -- 551,212 551,212

Net book value $1,290,480 $132,355 $1,422,835 ======= ====== =======

2018Lands Building Total

$ $ $CostBalance, 31 December 2017 1,290,480 643,796 1,934,276Additions -- 39,771 39,771Balance, 31 December 2018 1,290,480 683,567 1,974,047

Accumulated depreciationBalance, 31 December 2017 -- 483,985 483,985Additions -- 33,540 33,540Balance, 31 December 2018 -- 517,525 517,525

Net book value $1,290,480 $166,042 $1,456,522 ======= ====== =======

The Credit Union owns 6.29 acres of land situated on West Bay Street, in the vicinity ofSaunders Beach located in the Western District of New Providence and a buildingpreviously occupied as an office space in Village Road, Eastern District of New Providence.These are recorded at cost in accordance with IAS 40. The cost represents the purchase priceof the land and building, and all other costs incurred in closing its acquisition.

The fair value of the land is estimated at $3,400,000 based on an appraisal of the propertydone by Bahamas Realty on 13 March 2017. The fair value of the building is estimated at$1,525,000 based on an appraisal by Wilshire W. Bethel on 20 May 2019.

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11. FIXED ASSETS

2019

The Credit Union reclassified the land which was previously presented as part of building amounting to $525,665.

Land Buildings

Furniture and equipment

Computer hardwareand software

AutomatedTeller Machine Automobile Total

$ $ $ $ $ $ $COST1 January 2019 -- 2,706,791 242,542 130,834 -- 29,595 3,109,762Additions -- 18,960 7,779 6,783 52,426 -- 85,948Disposals -- -- (10,167) -- -- -- (10,167)Reclassification 525,665 (525,665) -- -- -- -- --

31 December 2019 525,665 2,200,086 240,154 137,617 52,426 29,595 3,185,543

DEPRECIATION1 January 2019 -- 137,283 125,079 80,841 -- 9,865 353,068Charge for the year -- 65,336 26,110 21,212 3,745 5,919 122,322Disposals -- -- (10,167) -- -- -- (10,167)

31 December 2019 -- 202,619 141,022 102,053 3,745 15,784 465,223

NET BOOK VALUE31 December 2019 $525,665 $1,997,467 $99,132 $35,564 $48,681 $13,811 $2,720,320 ====== ======= ===== ===== ===== ===== =======31 December 2018 $-- $2,569,508 $117,463 $49,993 $-- $19,730 $2,756,694 == ======= ====== ===== == ===== =======


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11. FIXED ASSETS

2019

The Credit Union reclassified the land which was previously presented as part of building amounting to $525,665.

Land Buildings




$ $ $ $ $ $ $COST1 January 2019 -- 2,706,791 242,542 130,834 -- 29,595 3,109,762Additions -- 18,960 7,779 6,783 52,426 -- 85,948Disposals -- -- (10,167) -- -- -- (10,167)Reclassification 525,665 (525,665) -- -- -- -- --

31 December 2019 525,665 2,200,086 240,154 137,617 52,426 29,595 3,185,543

DEPRECIATION1 January 2019 -- 137,283 125,079 80,841 -- 9,865 353,068Charge for the year -- 65,336 26,110 21,212 3,745 5,919 122,322Disposals -- -- (10,167) -- -- -- (10,167)

31 December 2019 -- 202,619 141,022 102,053 3,745 15,784 465,223

NET BOOK VALUE31 December 2019 $525,665 $1,997,467 $99,132 $35,564 $48,681 $13,811 $2,720,320 ====== ======= ===== ===== ===== ===== =======31 December 2018 $-- $2,569,508 $117,463 $49,993 $-- $19,730 $2,756,694 == ======= ====== ===== == ===== =======


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11. FIXED ASSETS (cont)

2018

Land Buildings




$ $ $ $ $ $ $COST1 January 2018 -- 2,690,669 178,480 126,441 -- 48,225 3,043,815Additions -- 16,122 64,062 4,393 -- -- 84,577Disposals -- -- -- -- -- (18,630) (18,630)Reclassification -- -- -- -- -- -- --

31 December 2018 -- 2,706,791 242,542 130,834 -- 29,595 3,109,762

DEPRECIATION1 January 2018 -- 26,784 106,412 59,203 -- 22,576 214,975Charge for the year -- 110,499 18,667 21,638 -- 5,919 156,723Disposals -- -- -- -- -- (18,630) (18,630)

31 December 2018 -- 137,283 125,079 80,841 -- 9,865 353,068

NET BOOK VALUE31 December 2018 $-- $2,569,508 $117,463 $49,993 $-- $19,730 $2,756,694 == ======= ====== ===== == ===== =======31 December 2017 $-- $2,663,885 $72,068 $67,238 $-- $25,649 $2,828,840 == ======= ===== ===== == ===== =======


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12. ACCOUNTS PAYABLE AND ACCRUED EXPENSES

2019 2018$ $

Accrued interest payable 875,952 897,829Unapplied receipts 136,568 52,126Accrued expenses 71,151 118,729Stale dated cheques 52,900 10Accounts payable 43,223 42,051Tenants deposit 15,000 15,000Other payables 3,575 3,492

$1,198,369 $1,129,237======= =======

13. MEMBERS’ DEPOSITSRates 2019 2018

$ $Regular deposits 3.00% 21,584,575 19,886,996Other deposits Certificate of deposits 3.25% - 6.00% 7,161,784 7,770,053

Retirement savings 3.30% - 6.00% 7,130,581 7,008,648 Educational savings 3.35% - 6.00% 1,603,785 1,528,087

Christmas club accounts 3.00% 2,403,176 1,587,209 Kids accounts 3.00% 725,339 701,860

Kall Accounts 702,292 165,477 Dormant accounts 104,273 106,827

Debit card accounts 96,170 119,085 Vacation club deposits 82,190 58,385

Master card accounts 69,543 77,369 Group insurance 56,971 54,251

School fee deposits 52,577 64,335 Bill paying accounts 36,897 28,099

Queen’s College account 17,574 21,033 Business accounts 11,923 15,663Non-member deposits 3.30% - 6.00% 241,554 497,354

$42,081,204 $39,690,731======== ========


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13. MEMBERS’ DEPOSITS (cont)

Shares may be transferred to another member or anyone eligible for membership with theconsent of the Board of Directors. Shares may be withdrawn in whole or in part by themember; however, the Board of Directors reserves the right at any time to require a memberto give notice not exceeding 6 months, provided that no member may withdraw anyshareholdings below the amount of his total liability to the Credit Union without approval ofthe Board of Directors.

14. BORROWINGS

Borrowings are comprised of the following:

2019 2018$ $

Balance, beginning 1,862,351 2,199,141Repayments (294,082) (336,790)

$1,568,269 $1,862,351======= =======

These are broken down as follows:

Current portion 327,603 326,326Long-term portion 1,240,666 1,536,025

$1,568,269 $1,862,351======= =======

The Credit Union entered into a loan agreement with Teachers and Salaried Workers Co-operative Credit Union Limited to borrow $2,450,000 on 7 February 2017 for a period of 7years. Principal and interest are to be repaid in 85 monthly instalments of $35,306.60,payable at the end of each month. The facility will mature on 30 January 2024.

The purpose of the loan was to acquire new office facilities, which the Credit Unionrelocated in 2017.

The facility is secured by a first demand legal mortgage over land and building, which islocated in the Palmdale Subdivision, Corner of Rosetta & Patton Streets, Eastern District,New Providence.

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15. QUALIFYING SHARES AND OTHER RESERVE

a. Qualifying shares

The movements in qualifying shares during the year are comprised of the following:

2019 2018$ $

Balance, beginning 1,417,800 1,250,800Issued during the year 143,400 206,400Withdrawals and transfers (7,400) (39,400)

$1,553,800 $1,417,800 ======= =======

Shares in the Credit Union entitle each member 1 vote at the Annual General Meeting(AGM). At 31 December 2019, the Credit Union had 7,769 members (2018: 7,089members).

In a resolution passed in 2019 AGM, the members approved that the qualifying shares areno longer redeemable. Shares of members withdrawing from the Credit Union are retainedin the Members’ Equity as donated capital.

b. Statutory reserve fund


2019 2018$ $

Balance, beginning 3,261,147 3,020,218Transfers from retained earnings 104,528 240,929

$3,365,675 $3,261,147 ======= =======


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15. QUALIFYING SHARES AND OTHER RESERVE

a. Qualifying shares


2019 2018$ $

Balance, beginning 1,417,800 1,250,800Issued during the year 143,400 206,400Withdrawals and transfers (7,400) (39,400)

$1,553,800 $1,417,800 ======= =======

Shares in the Credit Union entitle each member 1 vote at the Annual General Meeting(AGM). At 31 December 2019, the Credit Union had 7,769 members (2018: 7,089members).

In a resolution passed in 2019 AGM, the members approved that the qualifying shares areno longer redeemable. Shares of members withdrawing from the Credit Union are retainedin the Members’ Equity as donated capital.

b. Statutory reserve fund


2019 2018$ $

Balance, beginning 3,261,147 3,020,218Transfers from retained earnings 104,528 240,929

$3,365,675 $3,261,147 ======= =======


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15. QUALIFYING SHARES AND OTHER RESERVE (cont)

The deficiency in this requirement is as follows:

2019 2018$ $

Statutory reserve ending balance 3,365,675 3,216,147Requirement (10% of total assets) 5,029,971 4,818,383

$(1,664,296) $(1,557,236) ======= =======

The requirement to hold 10% of the Credit Union’s assets in a statutory reserve account in astatutory reserve account in member’s equity has not been met. The compliance to therequirement is only at 7% (2018: 7%).

The Act further requires that the Credit Union keep its statutory reserves, retained earningsand equity shares at no stage less than 10.00% of its total assets except during the phase inperiod as permitted by the regulations. The funds may be withdrawn by the Credit Union tomeet emergency cash requirements in accordance with the policies established for theoperation of the fund. The total of the statutory reserves, retained earnings and qualifyingshares of $5,348,636 (2018: $5,407,857) exceeds the minimum 10.00% total assetsrequirement by $318,665 (2018: $589,474).

c. Fair value reserve

The movements in fair value reserve comprise:

2019 2018$ $

Balance, beginning 93,650 110,480Fair value gain/(losses) 2,180 (16,830)

$95,830 $93,650 ===== =====

This represents the accumulated unrealised gains/losses arising on the revaluation of equityshares traded on the Bahamas International Stock Exchange (BISX).


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15. QUALIFYING SHARES AND OTHER RESERVE (cont)

d. Retained earnings2019 2018

$ $Balance, beginning 728,910 832,159Effect of IFRS 9 adoption (557,290) --Profit/(loss) for the year 418,197 236,736Transfer to statutory reserve (104,528) (240,929)Dividends to members (56,128) (99,056)

$429,161 $728,910 ====== ======e. Dividends on qualifying shares

Dividends on qualifying shares is an appropriation of retained earnings. During the yearended 31 December 2019, the Directors proposed a dividend of 4% (2018: 4%) be paid tothe members. This will be voted on by the members at the Annual General Meeting.Dividends declared and paid during the year totaled $56,128 (2018: $99,056).

16. NET FINANCE INCOME BEFORE PROVISION FOR LOAN LOSSES

Net finance income before provision for loan losses comprises:2019 2018

$ $Net interest on members operationsInterest earned on loan to members 2,864,486 2,668,554Interest expense on members’ deposit (1,078,160) (1,172,961)

1,786,326 1,495,593Investment interest incomeStatutory reserve deposits at the League 72,970 80,756BAF Financial & Insurance (Bahamas) Ltd. 47,759 53,974Bahamas Government Registered Stock 53,893 35,681Liquidity reserve deposits with the League 59,151 64,517Other deposits at the League 25,483 245Fixed deposits at the Bank 49,513 13,357

308,769 248,530

Interest expense on borrowings (101,157) (112,929)

$1,993,938 $1,631,194======= =======


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17. NON-INTEREST INCOME2019 2018

$ $Service charges 1,193,419 808,008Rental income 90,000 75,000Insurance dividends 49,462 --Entrance fees 40,198 50,196Bill payment fees 37,429 18,397Dividends on equity investment 19,280 19,828Other income 18,291 113,472Credit card membership fees -- 4,267Gain on disposal of property, plant and

equipment -- 800

$1,448,079 $1,089,968======= =======

18. PERSONNEL2019 2018

$ $Salaries 719,843 603,299Medical and pension (Pension Note) 114,473 102,403National insurance 32,623 30,634Employee training and development 13,463 17,138Other benefits 44,280 6,021

$924,682 $759,495 ====== ======

19. ORGANISATIONAL2019 2018

$ $Annual league dues 119,145 105,088Board and committee meetings 73,301 80,021Annual general meeting 35,151 26,213WOCCU and CCCU conventions 3,770 13,971Officers’ and directors’ travel -- 5,920

$231,367 $231,213 ====== ======


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20. GENERAL BUSINESS2019 2018

$ $Value Added Tax (VAT) 34,443 33,200Professional and legal fees 33,714 105,125Depreciation – furniture and fixtures 26,110 15,691Stationery and supplies 26,092 51,579Debit card expenses 23,937 4,346Telephone 20,208 27,291Bank charges 18,253 50,556Other general expense 10,038 17,346Equipment maintenance 7,457 10,057Depreciation – motor vehicle 5,919 5,919Insurance – office liabilities 4,772 4,710Depreciation - ATM 3,745 --Motor vehicle maintenance 3,745 3,015Insurance – motor vehicle 828 819

$219,261 $329,654 ====== ======

21. OCCUPANCY2019 2018

$ $Security 68,159 52,088Depreciation – fixed asset building 65,336 110,499General maintenance 62,068 69,249Utilities 47,282 54,714Insurance – building 40,905 35,543Depreciation – investment property building 33,687 33,540Property tax 13,645 5,689

$331,082 $361,322 ====== ======


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22. MEMBERS’ SECURITY2019 2018

$ $Loans and savings insurance premium 330,209 335,165Bond insurance -- 4,171

$330,209 $339,336====== ======

23. COMPUTER COSTS2019 2018

$ $Maintenance and supplies 70,161 59,168Computer hardware – depreciation 15,241 16,202Computer software – depreciation 5,972 5,435

$91,374 $80,805===== =====

24. MARKETING2019 2018

$ $Advertising and promotions 27,209 45,693Donations and gifts 11,438 3,925

$38,647 $49,618===== =====

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25. RELATED PARTY BALANCES AND TRANSACTIONS

Directors, committee members and staff member are classified as related parties andmaintained the following balances and transactions with the Credit Union:

2019 2018$ $

Directors and committee members:Loans including interest 798,039 783,733

Interest income 50,705 55,810Shares and savings 643,454 686,574

Interest expense 45,468 12,829

Staff members:Loans including interest 268,071 175,336

Interest 12,626 10,220Shares and savings 358,821 289,731Interest expense 9,398 2,243

Family members:Loans including interest 235,995 318,333Interest income 21,444 36,988Shares and savings 626,333 723,229


Loans are generally granted in accordance with normal lending policies applicable to othermembers, (i.e. rates, terms, conditions, qualifying criteria, security, etc.) with the exceptionof loans to those staff members who are to receive preferential rates in their employmentpackage and are included in loans receivable on the statement of financial position.

Shares and savings accounts are maintained under the same terms and conditions asaccounts of other members (i.e. rate, terms, conditions, qualifying criteria, security, etc.) andare included in members’ deposits and qualifying shares on the statement of financialposition.


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25. RELATED PARTY BALANCES AND TRANSACTIONS

Directors, committee members and staff member are classified as related parties andmaintained the following balances and transactions with the Credit Union:

2019 2018$ $

Directors and committee members:Loans including interest 798,039 783,733

Interest income 50,705 55,810Shares and savings 643,454 686,574


Staff members:Loans including interest 268,071 175,336

Interest 12,626 10,220Shares and savings 358,821 289,731Interest expense 9,398 2,243

Family members:Loans including interest 235,995 318,333Interest income 21,444 36,988Shares and savings 626,333 723,229


Loans are generally granted in accordance with normal lending policies applicable to othermembers, (i.e. rates, terms, conditions, qualifying criteria, security, etc.) with the exceptionof loans to those staff members who are to receive preferential rates in their employmentpackage and are included in loans receivable on the statement of financial position.

Shares and savings accounts are maintained under the same terms and conditions asaccounts of other members (i.e. rate, terms, conditions, qualifying criteria, security, etc.) andare included in members’ deposits and qualifying shares on the statement of financialposition.


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25. RELATED PARTY BALANCES AND TRANSACTIONS (cont)

Key management remuneration and board and committee expenses are as follows:

2019 2018$ $

Key management remuneration: Salaries and wages 363,150 343,466Statutory and other costs 68,037 53,309

Board and committee expenses:Committee training 4,044 13,971Allowance 67,150 72,255Other 5,877 11,252

26. PENSION PLAN

The Credit Union has a defined contribution retirement plan (“the Plan”) administered by afinancial institution, as trustee, covering the Credit Union’s regular employees. Theemployee’s participation in the plan is voluntary. The Credit Union contributes an amountequivalent to 5% to 6% (2018: 5% to 6%) of the employees’ annual salaries to the Plan.Total pension cost charged to operations amounted to $29,266 (2018: $25,136).

27. COMMITMENTS AND CONTINGENCIES

Litigation

The Credit Union is involved in several actions arising from the normal course of business.Management believes that the resolution of these matters will not have a material impact onthe Credit Union’s financial position.

Credit card operations

The Credit Union is a party to an agreement between the League and Scotiabank (Bahamas)Limited (“Scotiabank”) with respect to the Credit Union’s issuance of credit cards to itsmembers. As part of this agreement, the Credit Union indemnifies Scotiabank against creditlosses by settling balances that become more than 90 days delinquent. The League is theintermediary where agreements and correspondence are done through them. The totalbalance outstanding on credit cards at the reporting date was $338,680 (2018: $443,465). Asat 31 December 2019, there were delinquent credit cards with aggregate balance of $90,408(2018: $110,189).


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27. COMMITMENTS AND CONTINGENCIES (cont)

Dormant Accounts

Per the Bahamas Co-operative Credit Unions Act, 2015, where a deposit account is declareddormant, the Board shall transfer the account, interest and other sums due or standing to themember’s account to the Credit Union’s statutory reserve fund. After the period of fiveyears in the special reserve fund, the Board may transfer the dormant deposit account to theCentral Bank of the Bahamas (“Central Bank”) which shall maintain a separate accountingrecord of all such accounts. The Credit Union has not yet transferred any dormant depositaccount balance to the Central Bank since the first transfer for the dormant account to thereserves was made in 2018 and the statutory period in the fund is not complete. At the 31December 2019 year-end, the Credit Union is holding dormant account balances amountingto $104,273 (2018: $106,827).

28. FINANCIAL RISK MANAGEMENT

By its nature, the Credit Union’s activities are principally related to the use of financialinstruments. This will involve analysis, evaluation and management of some degree of riskor combination of risks. The Credit Union’s aims are, therefore, to achieve an appropriatebalance between risks and return and minimise potential adverse effects on the CreditUnion’s financial performance.

The Board of Directors (the “Board”) is ultimately responsible for the establishment andoversight of the Credit Union’s risk management framework. The Credit Union’s riskmanagement policies are designed to identify and analyse the risk faced by the CreditUnion, to set appropriate risk limits and controls, and to monitor risks and adherence tolimits by means of regularly generated reports. Risk management procedures are closelyintegrated into all key business processes. The Credit Union regularly reviews its riskmanagement policies, procedures and systems to reflect recommendations and best practice,as well as changes in markets and products.


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28. FINANCIAL RISK MANAGEMENT (cont)

The Board, through the following committees, is responsible for monitoring compliancewith the Credit Union’s risk management policies and procedures:

· Supervisory Committee

The Supervisory Committee oversees how management monitors compliancewith the Credit Union’s risk management policies and procedures and reviewsthe adequacy of the risk management framework in relation to the risks faced bythe Credit Union. This Committee undertakes both regular and ad hoc reviews ofrisk management controls and procedures, the result of which are reported to theBoard.

· Credit Committee

The Credit Committee oversees the approval and disbursements of credit facilities tomembers. It is also primarily responsible for monitoring the quality of loan portfolio.

The Credit Union accepts deposits from members at agreed rates of interest and seeks toearn above average interest margins by investing these funds in high quality assets, as wellas lending for longer periods at higher rates while maintaining sufficient liquidity to meet allclaims that might fall due.

These activities expose the Credit Union to a variety of financial risks, the most importantrisks are:

· Credit Risk· Liquidity Risk· Market Risk (including currency risk, interest rate risk and other price risk)

Credit risk

Credit risk is the risk that borrowers or other counterparties will cause a financial loss for theCredit Union by failing to discharge their contractual obligations when they become due,and that any collateral provided does not cover the Credit Union’s claims. Credit risk is themost important risk for the Credit Union’s business. As a consequence of the Credit Union’smandate and resulting financial structure, credit risk arises principally from lendingactivities and are concentrated in loans to members.


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Credit risk (cont)

For loans, credit decisions are primarily made by the Board of Directors, with somedelegation of credit approval authority to the Credit Committee and the Credit Union’sManager. There is a documented credit policy in place, which forms the basis for lendingoperations. The policy aims at maintaining a high quality loan portfolio, as well asenhancing the Credit Union’s mission and strategy. The policy sets the basic criteria foracceptable risk and identifies risk areas that require special attention.

Additionally, the Credit Union is exposed to credit risk in its treasury activities, arising fromfinancial assets that the Credit Union uses for investing its liquidity and managing currencyand interest rate risks, as well as other market risks.

The Credit Union manages the levels of credit risk they undertake by placing limits on theamount of risk accepted in relation to any one borrower, or group of borrowers. Such risksare monitored on a revolving basis and subject to an annual or more frequent review.Exposure to credit risk is managed through regular analysis of the ability of the borrowersand potential borrowers to meet interest and capital repayment obligations and by changingthese lending limits where appropriate. Exposure to credit risk is also managed in part byobtaining collateral and personal guarantees.

The principal collateral types for loans are:· Shares or deposits held at the Credit Union (except qualifying shares); and· Charges over assets such as automobiles and premises.

Management monitors the fair value of collateral held during its review of the adequacy ofthe provision for credit losses.

Borrowers of the Credit Union are segmented into two internal classes, performing andnonperforming.

The maximum exposure to credit risk before collateral held or other credit enhancements onloans totaled $26,550,496 (2018: $24,802,381).

For all other financial assets on the statement of financial position, the maximum exposureto credit risk is based on the net carrying amounts as reported in the statement of financialposition.


78

44





Liquidity risk

Liquidity risk, also referred to as funding risk, is the risk that the Credit Union willencounter difficulty in raising funds to meet its obligations and commitments associatedwith its financial liabilities when they fall due, and to replace funds when they arewithdrawn. The consequence may be the failure to meet obligations to repay depositors andfulfill commitments to lend.

The Credit Union is exposed to daily calls on its available cash resources from generalsavings deposits, maturing loans draw-downs, guarantees, withdrawal of shares andoperating commitments. The Credit Union does not maintain cash resources to meet all ofthese needs, as experience shows that a minimum level of reinvestment of maturing fundscan be predicted with a high level of certainty.

The liquidity management process is monitored by the Manager and includes:

· Monitoring future cash flows and liquidity on a daily basis. This incorporates anassessment of the Credit Union’s source of funds which includes, cash and bankbalances, items in the course of collection and investment maturities in order todetermine their ability to meet its commitments;

· Maintaining a portfolio of highly marketable and diverse assets that can easily beliquidated as protection against any unforeseen interruptions to cash flow;

· Maintaining committed lines of credit with its Bankers and the League;· Monitoring statement of financial position liquidity ratios against internal and

regulatory requirements. The most important of these is to maintain limits on theratio of net liquid assets to liabilities; and

· Matching and mismatching of the maturities and interest rates of financial assetsand financial liabilities. An unmatched position potentially enhances profitability,but can increase risk.

The table in the next page summarises the Credit Union’s exposure to liquidity risk based onrelevant contractual repayment obligations.


79

45





2019 Within 3 Months

3 Months to 1 Year

Over 1 to 5 Years Over 5 Years Total

$ $ $ $ $Financial Assets:Cash and cash equivalents 2,926,619 -- -- -- 2,926,619Deposits with banks and other institutions -- 51,664 3,811,878 -- 3,863,542Deposits with the League 9,918,925 -- -- -- 9,918,925Other receivables and prepayments 1,974,143 156,597 -- -- 2,130,740Financial investments -- 646,165 140,000 850,000 1,636,165Loans receivable 177,273 571,373 18,697,893 6,234,023 25,680,562

14,996,960 1,425,799 22,649,771 7,084,023 46,156,553

Financial Liabilities:Accounts payable and accrued expenses 1,198,369 -- -- -- 1,198,369Members’ shares and other deposits 26,388,037 7,332,825 8,360,342 -- 42,081,204Borrowings 84,418 260,316 1,223,535 -- 1,568,269

27,670,824 7,593,141 9,583,877 -- 44,847,842

Liquidity Gap $(12,673,864) $(6,167,342) $13,065,894 $7,084,023 $1,308,711 ======== ======= ======== ======= =======


80

46






3 Months to 1 Year

Over 1 to 5 Years Over 5 Years Total

$ $ $ $ $Financial Assets:Cash and cash equivalents 2,809,708 -- -- -- 2,809,708Deposits with banks and other institutions -- 51,581 3,714,724 -- 3,766,305Deposits with the League 9,074,977 -- -- -- 9,074,977Other receivables and prepayments 1,898,104 121,731 -- -- 2,019,835Financial investments -- 392,285 390,000 850,000 1,632,285Loans receivable 150,468 467,914 18,472,754 5,576,364 24,667,500

13,933,257 1,033,511 22,577,478 6,426,364 43,970,610

Financial Liabilities:Accounts payable and accrued expenses 1,129,237 -- -- -- 1,129,237Members’ shares and other deposits 23,185,888 7,989,945 8,514,898 -- 39,690,731Borrowings 77,580 232,739 1,518,340 33,692 1,862,351

24,392,705 8,222,684 10,033,238 33,692 42,682,319

Liquidity Gap $(10,459,448) $(7,189,173) $12,544,240 $6,392,672 $1,288,291 ======== ======= ======== ======= =======


81

47





Market risk

The Credit Union takes on exposure to market risk, which is the risk that the fair value orfuture cash flows of a financial instrument will fluctuate because of the changes in marketprices. Market risk arise from open position in foreign currencies (currency risk), interestrates (interest rate risk), and equity products (other price risk), all of which are exposed togeneral and specific market movements and changes in the level of volatility of market ratesor prices such as interest rates, credit spreads, foreign exchange rates and equity prices.

Currency risk

Currency risk or foreign exchange risk is the risk that the fair value or future cash flows of afinancial instrument will fluctuate because of changes in foreign exchange rates. The CreditUnion has minimum exposure to currency risk, as all its assets and liabilities are stated in theBahamian dollars, which is the Credit Union’s functional and presentational currency.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrumentwill fluctuate because of changes in market interest rates, and arises mainly from interestbearing deposits, loans receivable, debt securities, bank overdraft and members’ and non-members’ deposits.

Floating rate instruments expose the Credit Union to cash flow interest rate risk, whereasfixed interest rate instruments expose the Credit Union to fair value interest rate risk. TheCredit Union takes on exposure to the effects of fluctuations in the prevailing levels ofmarket interest rates on both its fair value and cash flow risks. Interest margins may increaseas a result of such changes but may reduce losses in the event that unexpected movementsarise.

The Credit Union’s interest rate risk policy requires it to manage interest rate risk bymaintaining an appropriate mix of fixed and variable rate instruments as determined by theLeague. The policy also requires it to manage the maturities of interest bearing financialassets and interest bearing financial liabilities. The Board sets limits on the level ofmismatch of interest rate re-pricing that may be undertaken.

The table in the next page summarises the Credit Union’s exposure to interest rate risk. Theyinclude the Credit Union’s financial instruments at carrying amounts, categorised by theearlier of contractual re-pricing or maturity dates.


82

48





Repricing date of interest sensitive instruments


3 to 12 Months

1 to 5 years

Over 5 Years

Non-interest rate sensitive TOTAL

$ $ $ $ $ $Financial Assets:Cash and cash equivalents 425,188 -- -- -- 2,501,431 2,926,619Deposits with banks and other institutions -- 51,664 3,811,878 -- -- 3,863,542Deposits with League -- -- -- 9,918,925 -- 9,918,925Loans receivable, net 177,273 571,373 17,550,461 6,234,023 1,147,432 25,680,562Other receivables and prepayments -- -- -- -- 2,130,740 2,130,740Financial investments -- 250,000 140,000 850,000 396,165 1,636,165

602,461 873,037 21,502,339 17,002,948 6,175,768 46,156,553

Financial Liabilities:Accounts payable and accrued expenses -- -- -- -- 1,198,369 1,198,369Members’ shares and other deposits 25,981,076 7,332,825 8,360,342 -- 406,961 42,081,204Borrowings 84,418 260,316 1,223,535 -- -- 1,568,269

26,065,494 7,593,141 9,583,877 -- 1,605,330 44,847,842

Net Repricing Gap $(25,463,033) $(6,720,104) $11,918,462 $17,002,948 $4,570,438 $1,308,711 ======== ======= ======== ======== ======= =======


83

49





Repricing date of interest sensitive instruments


7 to 12 months

1 to 2 years

Over 2 years

Non-interest rate sensitive TOTAL

$ $ $ $ $ $Financial Assets:Cash and cash equivalents 1,111,610 -- -- -- 1,698,098 2,809,708Deposits with banks and other institution -- 51,581 2,000,000 1,714,724 -- 3,766,305Deposits with League -- -- -- 9,074,977 -- 9,074,977Loans to members, net 9,916 371,342 17,410,705 5,384,529 1,491,008 24,667,500Other receivables and prepayments -- -- -- -- 2,019,835 2,019,835Financial investments -- -- 350,000 890,000 392,285 1,632,285

1,121,526 422,923 19,760,705 17,064,230 5,601,226 43,970,610

Financial Liabilities:Accounts payable and accrued expenses -- -- -- -- 1,129,237 1,129,237Members’ shares and other deposits 22,802,044 7,989,945 8,514,899 -- 383,843 39,690,731Borrowings 77,580 232,739 1,518,340 33,692 -- 1,862,351

22,879,624 8,222,684 10,033,239 33,692 1,513,080 42,682,319

Net Repricing Gap $(21,758,098) $(7,799,761) $9,727,466 $17,030,538 $4,088,146 $1,288,291 ======= ======= ======= ======== ======= =======


84

50




29. CAPITAL RISK MANAGEMENT

The Credit Union’s objectives when managing capital are as follows:

· To comply with the capital requirements set by the regulator of the Co-operativesSocieties;

· To safeguard the Credit Union’s ability to continue as a going concern so that it cancontinue to provide returns for its members and benefits for other stakeholders; and

· To maintain a strong capital base to support the development of its business.

The Credit Union’s Board reviews the capital structure on a quarterly basis. As part of thereview, the Board considers the provision of the Bahamas Co-operative Credit Unions Act,2015, Section 65, which states that:

Every society shall ensure that –

a. Not less than 10% of its members’ deposits are kept in a liquidity reserve fund; andb. Statutory reserves, retained earnings and equity shares are at no stage less than 10%

of its total assets, except during the phase in period as permitted by regulations.

The table below summarises the computation of the Credit Union’s regulatory capital andthe ratios for the years ended December 31:

2019 2018$ $

Liquidity reserve fund Liquidity reserves deposits 4,416,343 4,007,192Members deposit 42,081,204 39,690,731

Actual ratio 10.49% 10.10% Required ratio 10.00% 10.00%Excess over regulation 0.49% 0.10%

Statutory reserve, retained earnings and equity shares Regulatory reserves 5,348,636 5,407,857Total assets 50,299,708 48,183,826

Actual ratio 10.63% 11.22% Required ratio 10.00% 10.00%Excess over regulation 0.63% 1.22%

51




30. SUBSEQUENT EVENTS

The 2019 Novel Coronavirus infection (‘coronavirus’) or ‘COVID-19’ outbreak poses aserious public health threat. It has interrupted the movement of people and goodsthroughout the world, and many levels of government are instituting restrictions onindividuals and businesses. The resulting impact on financial reporting will be significant.

The World Health Organisation (WHO) announced the coronavirus as a global healthemergency, which prompted the governments worldwide to put actions in place to slowthe spread of COVID-19 including social distancing, curfews and total lockdowns ofbusinesses. As such, the outbreak represents a significant subsequent event with regardsto the 31 December 2019 financial statements.

The Central Bank of the Bahamas has arranged with domestic banks and credit unions toprovide a 3-month deferral against repayments on credit facilities for businesses andhouseholds that are negatively impacted by the domestic economic shutdown. These loanswill not be considered at default and the Credit Union will still accrue interest, however, thiswill extend loan repayment terms which will have a future impact on the Credit Union’sdelinquency.

It was noted in a local press release recently that there would be a staggered reopening ofhotels in the Bahamas commencing July 2020 throughout the rest of the year.

The slowdown in economic activity will also impact the Credit Union’s membership asbusinesses close and persons being temporarily laid-off from work.

Expected impact on significant financial statement areas follow:

Financial Statement area Description of Impact

Cash and deposits with banksincluding fixed deposits andrelated interest income.

Fixed Deposits - No significant impact as these would notdecrease based on liquidity of Credit Union and holdinginstitution have not communicated any decrease in currentinterest rates.

Cash with Bank – No significant impact; however, there is adecrease in member deposits (i.e. salary deductions to bereceived) specifically from our member’s in the hotel industry.


85

51




30. SUBSEQUENT EVENTS

The 2019 Novel Coronavirus infection (‘coronavirus’) or ‘COVID-19’ outbreak poses aserious public health threat. It has interrupted the movement of people and goodsthroughout the world, and many levels of government are instituting restrictions onindividuals and businesses. The resulting impact on financial reporting will be significant.

The World Health Organisation (WHO) announced the coronavirus as a global healthemergency, which prompted the governments worldwide to put actions in place to slowthe spread of COVID-19 including social distancing, curfews and total lockdowns ofbusinesses. As such, the outbreak represents a significant subsequent event with regardsto the 31 December 2019 financial statements.

The Central Bank of the Bahamas has arranged with domestic banks and credit unions toprovide a 3-month deferral against repayments on credit facilities for businesses andhouseholds that are negatively impacted by the domestic economic shutdown. These loanswill not be considered at default and the Credit Union will still accrue interest, however, thiswill extend loan repayment terms which will have a future impact on the Credit Union’sdelinquency.

It was noted in a local press release recently that there would be a staggered reopening ofhotels in the Bahamas commencing July 2020 throughout the rest of the year.

The slowdown in economic activity will also impact the Credit Union’s membership asbusinesses close and persons being temporarily laid-off from work.

Expected impact on significant financial statement areas follow:


Cash and deposits with banksincluding fixed deposits andrelated interest income.

Fixed Deposits - No significant impact as these would notdecrease based on liquidity of Credit Union and holdinginstitution have not communicated any decrease in currentinterest rates.

Cash with Bank – No significant impact; however, there is adecrease in member deposits (i.e. salary deductions to bereceived) specifically from our member’s in the hotel industry.


86

52




30. SUBSEQUENT EVENTS (cont)


Deposits with League andrelated interest income.

No significant impact based on nature of accounts as thesewould not decrease and holding institution have notcommunicated any decrease in current interest rates.

Marketable securities includingeffect on fair value

Significant impact based on economic climate; immaterialfinancial impact based on Credit Union’s stock holdings.

Bahamas Government RegisterStock and BGS including effectson its fair value and relatedinterest income

No significant impact based on issuer’s lack of communicationregarding impairment and no viable impairment indicators.

Loans receivable includingeffect on principal and interestcollection, loan issuance andloan policy

Decrease due to the economic climate and the increasedscrutiny regarding lending. An increase in loan delinquency isalso expected.

Members deposit Decrease due to decrease of salary deductions coming in.

Borrowings No significant impact as mortgage payments will continuebased on contract.

Staff cost No significant impact.

Contingent on the duration of the COVID-19 crisis and continued negative impact oneconomic activity, the Credit Union may experience further negative results. The exactimpact on our activities in the remainder of 2020 and thereafter cannot be predicted.


87

53




30. SUBSEQUENT EVENTS (cont)

Notwithstanding these unfavorable conditions subsequent to year-end, management hasconcluded that the Credit Union is expected to continue as a going concern.

31. COMPARATIVE FIGURES

Presentation of certain comparative balances has been re-stated in order to conform with thecurrent year’s presentation.


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89

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90

Supervisory Committee REPORT TO THE AGMMEMBERS OF THE COMMITTEECHAIRMAN: David Barry IISECRETARY: Horatio McKenzieOTHER MEMBERS: Kenneth Lightbourne Marlon Bethel J. Almitra Collie (Former secretary; Resigned September 2020)

INTRODUCTIONThe Supervisory Committee (“the Committee”) would like to thank the membership for the privilege and honor to present its report for the 2020 Annual General Meeting of the Bahama Islands Co-operative Credit Union Limited (“BICCU”).

Our prayers go out to all of those affected by Covid-19, and especially to those who have lost loved ones or who are physically fighting the virus. We stand with you.

We would also like to take this time to thank our former Secretary and former Chairperson Jasmine Collie for her dedicated service over a 5 year period on this Committee. Jasmine was instrumental in setting a high standard as well as being a strong voice on this Committee. We wish her all the best as she moves on to focus on her personal endeavors.

Your Committee remained committed and accountable to our core duties as provided by the Bahamas Cooperative Credit Unions Act, 2015 (“the Act’), which are as follows:

• Examine the books of the Bahama Islands Co-operative Credit Union Confirm the cash instruments, property and securities of BICCU

• Confirm the deposits of the members and • Perform such other duties under the Act and the bye-laws.

OBJECTIVESIn order to achieve our core duties as mandated by the Act, the Bye-laws and the Regulations, the Committee carried out various audits/reviews to ensure that Management, the Board and Staff were acting in compliance with the Credit Union’s standard operating policies and procedures; acting in the best interest of the organization and by extension its members.Our audit/reviews included but were not limited to the following:

• Discussions with Management and BICCU’s Board of Directors • Review and testing of documents necessary to perform the audits/reviews 1 • Petty cash reviews • Review of Delinquency Reports • Review of Statement of Assets • Review of Minutes of the Board of Directors

2020


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• Review of Financial Statements • Review of Loan Files • Review of Dormant Account Report • Review of Personnel Files • Review of existing policies and procedures of BICCU • Review of Central Bank’s Report • Review of the External Auditor’s Management Letter (for the year ended December 2019).

MANAGEMENTThe Committee and our Internal Auditor remained in contact with Management as needed, in order to address policy, and operational matters arising from our reviews. Our communication was fruitful in clarifying and resolving concerns that came about.

Throughout the period 2019 to 2020, the Committee met regularly with mostly all of our meetings attended by all Committee Members. The Secretary and Chairperson kept Minutes of each Meeting and have ensured that, our signed Minutes have been forwarded to the Board of Directors (“BOD”). Finally, the Committee had joint Meetings with the Board of Directors and discussed observations and recommendations discovered from the Committee’s reviews.

INTERNAL AUDITORThe duties of the Internal Auditor are to provide independent assurance that an organization’s risk management, governance and internal control processes are operating effectively. Accordingly, our Internal Auditor submitted an Internal Audit Plan, outlining the strategic plan for audits for 2019 / 2020 and 2020 / 2021 which was approved by the Committee.

Our Internal Auditor carried out the Audit plan as prescribed, in addition to completing all audits and attestations required by The Central Bank of the Bahamas.

In addition, throughout the year all opportunities that were uncovered that allowed BICCU to minimize risks were addressed. Several examples were as follows:

• The Committee requested for a Policy for Overdrawn Accounts which was tracked on the Action Plan • A Void Cheque Policy was requested, tracked on the Action Plan and reviewed by The Committee • Detailed record of the Fixed Asset Transfer Report was reviewed by the Committee • ATM Policy was requested and reviewed by the Committee are to provide independent assurance that an

organization’s risk management, governance and internal control processes are operating effectively.

COMMITTEE RECOMMENDATIONSIn cooperation with the Internal Audit Plan and the Management Letter recommendations the Committee had created an actionable list of recommendations to assist with strengthening BICCU and limiting risk.We are pleased to confirm that management has either produced existing policies and/or created/updated policies to our satisfaction. The Committee reviewed all requested policies and is satisfied that they meet best practices. The Committee can confirm that progress in making BICCU a stronger operation is headed in the right direction.A list of several of the policies reviewed by the Committee was:

• Review of the New Loan Policy • Review of the Collections Policy • Review of the Suspense Account Policy • Review of the Bank Reconciliation Policy • Review of the Cash Flow Policy


92

TRAININGIn February 2020, the Committee together with the BOD and the staff of BICCU attended a mandatory Anti-Money Laundering and Countering Terrorist Financing Training facilitated by Stephanie Missick-Jones of the Bahamas Co-operative League Limited (“the League”). Money laundering is the process by which criminals attempt to conceal the true origin and ownership of the profits (or proceeds) of their criminal acts. This session once again reinforced our knowledge on how to detect and prevent money laundering at our organization.

Training is ongoing and will continue to be a key to success for the organization. The Committee believes that the CEO and the Board will continue to ensure that the staff attends training sessions relevant to the core business.

DELINQUENCY REPORTSThe Committee reviewed Delinquency Reports throughout the period. We note that in 2018 the Delinquency rate was at 5.9% ($1.4million) and 2019 ended with a rate of 6.7% ($1.6million). Whilst this is slightly higher than the PEARLS standard we can confirm that the CEO and Board has ramped up efforts in the collections department by hiring an aggressive recovery officer which will have a positive impact on collections moving forward.

PETTY CASHPetty cash reviews were conducted periodically without notice throughout the year by the Internal Auditor and all reviews/audits were found to be satisfactory.

BANK RECONCILIATIONSBank Reconciliations was a point of discussion when the Committee met with the Board of Directors during a joint meeting. This was an area of concern for the Committee as initially the Bank Reconciliations were not up to date.

Since then the Bank Reconciliation has been brought up to date. However the challenge arose that there were a number of outstanding unidentified items listed on the reconciliation on the main bank account that resulted in BICCU receiving a qualified audit.

The Committee by way of the Internal Auditor is in communication with the accounts department. The accounts department has shown that they are aggressively working on clearing these items and are giving regular updates on the progress. The Committee will continue to monitor to make sure that the unidentified items are cleared.

LOANSDuring the period, the Committee examined loan files that were selected randomly to be examined for compliance. The loans reviewed were in compliance according to current policy and standards. Management also presented a revised loan policy that the Committee had the opportunity to review.

The Committee will continue to review and monitor the loan portfolio as outlined in the Act.

DORMANT ACCOUNTSThe Committee has continued to review Dormant/ Inactive Member Accounts. The Committee is pleased to confirm that all necessary procedures are being adhered to and that all funds as mandated by the Dormant Account Policy have been transferred to The Bahamas Cooperative League Limited. The Committee is also pleased to report that BICCU is one of only two Credit Unions that have completed this mandate.

MANAGEMENT LETTER FOR PERIOD DECEMBER 2019The Committee reviewed the Management Letter for 2019 and can report that the CEO is aggressively addressing these items. The Committee will continue to keep this item under its purview.


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CONCLUSIONYour Committee remains committed to our obligations according to the Act and to the financial success of this organization. We take this opportunity to thank you, the members for your vote of confidence. We look forward to continuing our plan for success for the 2020/2021 period.

______________________ _________________________David Barry II Chairman Horatio McKenzie Secretary

______________________ _________________________Marlon Bethel Member Kenneth Lightbourne Member


94

REPORT OF THE CREDIT COMMITTEE TO THE 34th AGMSection 73 (1) (a) of the Co-operative Societies Act, 2015 states that every Co-operative Credit Union shall have a Credit Committee which consist of no less than three (3) members and no more than five (5) members, who were elected by the membership at the Annual General Meeting. BICCU’s Credit Committee consisted of five (5) members and one (1) Board Approved Director who provides guidance for the Committee. They are as follows:

Tanisha Brennen – ChairmanA. Mary Davis - SecretaryElston Bain Shevaun Stubbs A. Quentin CulmerHilton Bowleg – Board Director

MANDATESection 78 of the Bahamas Co-operative Credit Union Act, 2015, mandated the Credit Committee to meet at least once every month, keep minutes of its meeting and submit a report to the Board stating:

The number of loan application receivedThe number and category of loans granted The security obtained for such loansThe number of applications denied; and The number of delinquent loans; and Submit an annual report on the matters referred to in (i) to (vi) to the annual general meeting of the co-operative credit union.

The Committee confirms that it has fulfilled the mandate as outlined above.

DUTIESPer Section 71 of the BICCU’s byelaws the credit committee shall considers all applications for loans, make recommendations to the Board in respect of improved policies, procedures, practices and performance; it shall also, subject to the authorization of the Board, approve loans to members upon such terms and conditions as specified by the Board in the Loan Policy and Procedures Manual.

The Board however, in keeping with Section 72 (1) of BICCU’s Byelaws and best practices, by resolution, delegated the approval of all loans within approved and documented parameters to the CEO, Loans Manager and the Loan Officers. Loans outside the parameters require Board Approval. The Credit Committee remained responsible for ensuring that all loans conform to the Act and BICCU’s policies, namely the Loan and Collections Policy. This being the case the Credit Committee reviewed all loans for compliance to the Act and Loan Policy.

In June 2019, the Board, recognizing that the number of loan applications had increased significantly making it

2020


95

more difficult for Committee Members to review one hundred percent (100%) of the loan applications unanimously agreed to allow the Committee to review fifty percent (50%) of the loan files which would be randomly chosen.

REVIEW OF FILESDuring the June 2019 to June 2020, the credit union received 2,003 loan applications, of these the Credit Committee reviewed 1,074 loan files. The number and category of loans granted and reviewed by the Committee is as follows:

CATEGORY OF LOANS VIEWEDMiscellaneous 258Travel/Vacation 183Home Improvement/repair 106Medical/Dental 51Education 190Auto 2Preowned Auto 81Legal 3Wedding 10Funeral 15Hurricane 11Auto Repair 20Business Venture 17Down Payment on Home 1Generator 1Furniture/Appliance 13Restructure 5Car Insurance 2Christmas 101Consolidation 4TOTAL 1074

SECURITY FOR LOANSThe committee noted that the greatest percentage of loans were for miscellaneous bills, travel/vacation, and home improvement/repair. Of the 1074 loans reviewed, 5 were cash secured. The two (2) car loans were secured by the collateral. The majority of the loans; however, were secured by the salary deduction and the member’s savings which increases with each loan payment.

NUMBER OF APPLICATIONS DENIEDThe Committee confirms that they were made aware of 32 declined loans. The majority of the loans were declined as a result of the total debt service ratio being too high. In some cases, loans submitted for Board approval were denied. While the Act nor the Policy provides for the Board to give a reason for their denial, applications are only submitted for Board approval if the loan falls outside the parameters outlined in the loan policy.

RECOMMENDATIONS BY THE COMMITTEEIn reviewing the loans, the Committee noted that the deductions, voluntary, involuntary or irrevocable were old, in


96

some cases more than five (5) years. While the Committee understands that involuntary or irrevocable deductions should not be cancelled until the credit union issues a notice to cancel the deductions; some unscrupulous person can replace the irrevocable deduction with a voluntary one.

Additionally, as seen in the files, as time passes and persons secure additional financing from the credit union, the amount of the deduction changes so there can be numerous increases to the deduction which makes it difficult for the persons reviewing the files to keep a track of the total deductions.

The Committee suggested to the Board, and the Board approved the suggestion that when members are adding to their loans, prior to the approval, the Loans Department should request a letter confirming that the voluntary, involuntary or irrevocable salary deductions are still in place and the amount of the deduction.

DELINQUENCYThe Committee confirms the delinquency for the period as follows:

Month Number of Accounts Delinquency in DollarsJune 2019 496 3,005,792.05July 2019 447 2,567,562.44August 2019 489 2,841,229.33September 2019 509 3,176,661.39October 2019 493 2,840,920.32November 2019 488 2,556,346.00December 2019 269 1,610,996.87January 2020 300 1,844,772.82February 2020 331 2,221,087.95March 2020 358 2,457,326.34April 2020 851 8,378,007.40May 2020 267 1,630,773.72June 2020 338 2,507,897.79

As of December 2019 BICCU’s delinquency percentage stood at 6.07%, which is slightly above the PEARLS standard which is ≤ 5%. To this end, the Committee is happy to report that the Credit Union has hired a Recovery Officer. The Committee confirms that recovery year over year is as follows:

Year Recovery Amount2020 (Jan to June) $126,229.57 2019 $159,981.56 2018 $138,674.00

TRAININGIn an effort to ensure that the Committee had the required competency for the position, the members received extensive training relating to their duties and responsibilities from the Compliance Officer. Additionally, the members participated in the annual Anti-Money Laundering and Counter Terrorism Financing training facilitated by Mrs. Stephanie Missick-Jones, League Manager.

As BICCU grows the number and complexity of loans change, to this end the Committee has requested and the Board


97

has approved training relating to credit/loans especially as it relates to mortgages so that a thorough review can be conducted.

An initial training was scheduled for the April 2020; however, this was cancelled due to Covid-19. The facilitator, Mrs. Stephanie Missick-Jones, has agreed to conduct the training via Zoom; if warranted, in the first quarter of 2021.

SPECIAL THANKSThe Credit Committee takes this opportunity to thank the Board of Directors, CEO Bastian, Compliance Officer Moss and Vice Chairman Bowleg for their continued guidance throughout the year. The Committee also extends a sincere thank you to you the members for allowing us the opportunity to serve you. We solicit your continued support.

We pray that God continues to bless you all.

______________________ _________________________Tanisha Brennen, Chairman A. Mary Davis, Secretary

______________________ _________________________Elston Bain Shevaun Stubbs

______________________A. Quentin Culmer


98

EDUCATION COMMITTEE REPORT TO THE AGM(JULY 2019 – JUNE 2020)

In keeping with Section 48 (4) of the Bahamas Co-operative Societies Act, 2015, BICCU’s Board of Directors appointed an Education Committee which is responsible for planning, promoting, and hosting educational programs and training for BICCU’s members. The Education Committee is comprised of the following members:

• Nashon Rolle, Chairperson • Claudette Farrington, Secretary • Finesse Rahming • Rashard Ritchie • Rhonda Richardson-Chase

The Committee is assisted by Janet Guerriea, Board-appointed Director who provides guidance to the Committee, Carolyn Moss, Compliance Officer who assists with coordinating the planned activities and meetings and Chandalear Forbes, Marketing and Membership Services Manager who markets the Committee’s activities via mass e-mail blasts and displays in the credit union.

During the term, the Committee thanked Lolita Forde for her years of dedicated service to the Education Committee and by extension the Credit Union. Also, during the year, the Committee welcomed three new members increasing the Committee to five (5) members.

Finesse Rahming joined the Committee with 6 years Business experience and more than 10 years’ experience in the field of Education. Mrs. Rahming received many honours in education and is the C. C. Sweeting Senior High school Teacher of the Year 2019-2021 and the North-eastern District Finalist for the National Teacher of the Year 2019-2021.

Rhonda Richardson-Chase holds a master’s degree in Human Resources and has amassed more than 12 years’ experience in the human resources/ information systems in the hospitality industry, 13 years’ experience in banking and compliance, and 5 years Administrative experience.

Rashard Ritchie is trained in Public Administration, and has traveled extensively representing The Bahamas at many high-level meetings such as The Commonwealth Youth Council, London, United Kingdom, The Commonwealth Youth Forum and the Commonwealth Heads of Government Meeting (CHOGM) 2018 London, United Kingdom. Additionally, he is a member of the National Youth Advisory Council and the National Advisory Council on Crime. The Education Committee eagerly looked forward to a very productive year, their goal was to host three informative seminars, as follows:


99

• The Bahamas Credit Bureau, How Your Credit Score Can Impact Your Financial Future. • The Importance of The National Health Insurance; and • Preparing for the Annual Business Meeting Seminar (follow up to last year’s presentation).

SEMINARSThe Committee hosted its first seminar on November 9th, 2019 on the premises of the credit union at 9:00 a.m., the topic was “The Bahamas Credit Bureau, How Your Credit Score Can Impact Your Financial Future”, the guest speaker was Karen Rolle, Deputy Inspector, Bank Supervision Department, Central Bank of The Bahamas. The seminar was well received, about 70 - 75 persons were in attendance. The Committee has had requests for a follow-up seminar in the new year.

The Second seminar, “The Importance of the National Health Insurance” was tentatively scheduled for Wednesday 25th March, 2020 from 6:00 p.m. to 8:30 p.m. in a meeting room at the National Sport Stadium. It was anticipated that about seventy (70) persons would be in attendance and that light refreshments would be served following the event. Due to Covid19 this seminar and the follow-up to last year’s seminar, “Preparing for the Annual Business Meeting” Seminar was cancelled.

KIDDS ClubAs standard, the Committee hosted the KIDDS Club Christmas Party on Saturday December 14th, 2019. The kids enjoyed games such as hoopla, sack race and egg-n-spoon. The parents were thrilled with the popular Bingo game. There was lots of eats, music, and prizes. This year Committee decided not to wrap the gifts, instead the members were allowed to select the gift of their choice.

The Committee would like to thank its Coordinators, Mses. Guerriea, Moss and Forbes, the CEO and staff of BICCU for their assistance with the various events. Special thanks to the Board and you our members, for allowing us the opportunity to serve such a prestigious credit union.

May God continue to bless us all.

__________________ ____________________Nashon Rolle Claudette Farrington

__________________ ____________________Finesse Rahming Rhonda Richardson-Chase

_________________Rashard Ritchie


100

RESOLUTIONSResolution #1RESOLUTION FOR THE APPOINTMENT OF AUDITORS

WHEREAS The Bahamas Co-operative Union Act, 2015 requires that the Directors cause the accounts of the Credit Union to be audited at the end of each financial year by an auditor appointed by the Board.

BE IT RESOLVED that the Board of Directors of the Bahama Islands Co-operative Credit Union Limited (BICCU) be allowed to choose an auditing firm to conduct the audit for the fiscal year 2021.

Resolution #2RESOLUTION FOR REMUNERATION TO MEMBERS OF THE BOARD OF DIRECTORS

WHEREAS The Bahamas Co-operative Union Act, 2015 requires formal approval of all remuneration paid to Directors of the Bahama Islands Co-operative Credit Union Limited in accordance with –

Section 58 (1)




BE IT RESOLVED THAT Directors of the Bahama Islands Co-operative Credit Union Limited shall receive a stipend of Five Hundred Bahamian Dollars (B$500.00) per month.

Resolution #3REMUNERATION TO SUPERVISORY COMMITTEE MEMBERS OF THE BAHAMA ISLANDS COOPERATIVE CREDIT UNION LIMITED

WHEREAS The Bahamas Co-operative Union Act, 2015 requires formal approval of all remuneration paid to Members of the Supervisory Committee of the Bahama Islands Co-operative Credit Union Limited in accordance with –

Section 58 (1)



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BE IT RESOLVED THAT the members of the Supervisory Committee of the Bahama Islands Co-operative Credit Union Limited shall be paid a stipend of Two Hundred Bahamian Dollars (B$200.00) per month.

Resolution #4REMUNERATION TO CREDIT COMMITTEE MEMBERS OF THE BAHAMA ISLANDS COOPERATIVE CREDIT UNION LIMITED

WHEREAS The Bahamas Co-operative Union Act, 2015 requires formal approval of all remuneration paid to Members of the Credit Committee of the Bahama Islands Co-operative Credit Union Limited in accordance with –

Section 58 (1)




BE IT RESOLVED THAT the members of the Credit Committee of the Bahama Islands Co-operative Credit Union Limited shall be paid a stipend of One Hundred Fifty Bahamian Dollars (B$150.00) per month.

Resolution #5REMUNERATION TO EDUCATION COMMITTEE MEMBERS OF THE BAHAMA ISLANDS COOPERATIVE CREDIT UNION LIMITED

WHEREAS The Bahamas Co-operative Union Act, 2015 requires formal approval of all remuneration paid to Members of the Education Committee of the Bahama Islands Co-operative Credit Union Limited in accordance with –

Section 58 (1)




BE IT RESOLVED THAT the members of the Education Committee of the Bahama Islands Co-operative Credit Union Limited shall be paid a stipend of One Hundred Bahamian Dollars (B$100.00) per month.

Resolution #6LOAN LIMITS


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WHEREAS the Bahamas Co-operative Credit Union Act, 2015 states that the bye-laws shall provide for limits on the amounts of loans to any member or on any type of loans which may be granted.

BE IT RESOLVED that the limit on a Mortgage can be no more than 1% of the Credit Union’s total assets as calculated per the last audited financial statement.

BE IT FURTHER RESOLVED that the aggregate to one member can be no more than 1% of the Credit Union’s total assets as calculated per the last audited financial statement.

Resolution #7MAXIMUM LIABILITY

WHEREAS the Bahamas Co-operative Credit Union Act, 2015 states that a co-operative credit union shall not borrow funds in excess of ten percent of its total assets.

BE IT RESOLVED that the Maximum Liability that the Directors can bind the Credit Union for is ten percent of the Credit Union’s total assets.


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Adderley, Christina A.Adderley, Clothilda FAdderley, MaryAdderley, Monique M.Adderley, Rodesia AAlbury, Gene DAnderson, Cleomie RAndrews-Tucker, Delaina EBain. Elston N.Barr, DelilahBarry Ii, David ABastian, Mark OBastian, Shandles RBeckford, DaveBeckles, SoniaBethel, MarlonBethel, WilliamBlack, RoscoeBlack-Rolle, Norma MBonamy, Lynden WBowe, Alexandria VBowe, Denise NBowe, Diana MBowe, EdlicerBowe, Melissa SBowe, Sonya EBowe, Virginia PBowleg, Fredrick LBowleg, HiltonBrennen, BenjaminBrennen, Tanisha SBrown, Alexis DBrown, JulietteBrown, KarenBullard, Mark JBullard, Tamara VBurrows, Bernadette CBurrows, Dominique NBurrows, Matthew M. W. ABurrows, Rajmattie DButler, Bryan KButler, Esther DCampbell, Rosemary

Capron, Ethel MCartwright, SeanChipman-Ward. DarnellClarke, Latasha LCleare, CelesteColebrook, Patrice ACollie, LindaConstance-Barry, AlexanderCornish, IvyCox, Sherell MCrawley, Leslie KendalCulmer, Archelaus QuentinCulmer, Derick ACulmer-Hinsey, Angela BCumberbatch-Rolle, JulianCurry, ElizabethCurry, Hope MCurry-Knowles, Tania ADarling, Catherine KDavis, Albry MaryDavis, DonaldDavis, JamisonDavis, Peter LDavis, Tredika N MDavis-Bannister, EleanorDavis-Lloyd, SheliaDean, AdrianDean, Alexia TerecitaDean, Andrea TDean, Christopher ADean, Hesketh ADean, Mario ODean, PauletteDean, Rudolph RDelancy, LeonardDemeritte, ElvisDorsett, Fidentia NDuncanson, MavaloEarns, Elva YElliot, IndiaEvans, Trevel DarianFarrington, ClaudetteFerguson, John W

Forbes, Chandalear L PForbes, Durward KForbes, Ricardo LGarcia, Francisco EGibson, Audrianna EGibson, CindyGibson, Vanria EGilbert, Sonia AbigailGriffith, ChristopherGuerriea, Janet LDeleveux, TheresaHamilton, Olivia LaurenHanna-Saunders, ShazellHenfield, RolieHepburn, JeremiahHiggins, Darnell DHiggs, Shelton AHumes, Tancia MHunt, Joycelyn LHutchinson,-Smith, ClariceIngraham, Brian FIngraham, Philippa SJohnson, Antonio LivingstonJohnson, Christopher DJohnson, Cleo P AJones, Jasmine AKemp, Natalie NicoleKemp, Philip KKing, Michelle VKnowles, Katherine JLarrimore, Sharranda SLewis, Jayson MLightbourne, Ashley G NLightbourne, Kenneth LLockhart, PretinaLongley, CatherineMackey, Bridgette NicoleMackey, Shantell SMcKenzie, Frerishia LMcKenzie, HoratioMcKenzie, Naomi LMcQueen, Angelique NMiller, Dwight R


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2019 AGM ATTENDEES


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Miller, Ivan RudolphMiller, Stephanie DMorley, Edwin HMorris-Lockhart, ShantellMoss, Carolyn LMoss, Neko AMullings, Maya CNeily, Ruth RNewton, Aquaria SNottage, Antoinette MNouguez, MalcolinOliver, Sherkia LPinder, Antneal CPinnock, Michelle ChristiPoitier, Demethera LPratt, Maxine PPratt, Wendell WPratt-Daley, MoniqueReddock, Sherel LRichards, Vaquicha D Richardson-Chase, RhondaRoberts, Lynette VRobinson, Stephen GRolle, BarryRolle, Cindy AnnRolle, Humphrey VRolle, Latoya NRolle, Michael KRolle, Nashon SRolle, Shakera T TRolle-Edgecombe, AlkeishaRomer, Danielle CRussell, Carlton DRussell, Robyn ASands, Alvin AliSands, Bronson ASands, MarguerittaSands, Toverano DSaunders, Joseph BSaunders, Krystle SSaunders, SharlisaSeymour, Waydrissa LSimmons, StephenSmith, DerhamSmith, Kendra PSmith, Nicola DStevenson, Sherry ElaineStuart, Cleo VStubbs, Sandra P

Sweeting, NelsonTaylor, ClementTaylor, Mark ATaylor, TamikaTaylor, Thelma TThompson, Basil TThompson, Deborah JThompson, ElaineThompson, Judith LaverneThompson, KirkTirelli, Rachela RUsher, TherezWalkes-Pratt, Estella EWallace, DelveraWallace, GuionWallace, Joann PWallace, Julian SWard, MontgomeryWeech, Calnan RWilliamson, Barbara DYallop, Miles MYallop, YolanthaWhymns, JacquelineKnowles, TaraRolle, Allison


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BICCU ANNUAL GENERAL MEEING 2020

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