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The Community & Workers of Jamaica Co-operative Credit Union Limited on Half-Way-Tree Road in St Andrew, Jamaica (Photo: Jamaica Observer)

C&WJCCUL reports JM$396- million surplus

The Community & Workers of Jamaica Co-operative Credit Union Limited on Half-Way-Tree Road in St Andrew, Jamaica (Photo: Jamaica Observer)

The Community and Workers of Jamaica Co-operative Credit Union (C&WJCCUL) generated a surplus of JM$396 million — a 14 per cent increase over JM$348 million for the corresponding period in 2019. 

The December 31, 2020 quarter trailed the corresponding period by JM$17 million.

According to management of the credit union, the increased profitability “reflects the management’s deliberate strategy and prudent practices by seizing the opportunities during the time of a crisis.”

Carlton Barclay, CEO of Community and Workers of Jamaica Co-operative Credit Union Limited speaking at the listing ceremony of the entity’s 7.35 per cent Series A variable-rate deferred shares. (Photo: Karl McLarty/Jamaica Observer)

Surplus of JM$134 million for the quarter ended December 31, 2020, represents an 11 per cent decrease relative to the corresponding period December 31, 2019.

Responding to COVID-19 concerns

“Our members in various sectors namely transport, agriculture and tourism continue to be negatively impacted by the pandemic,” directors said in remarks attached to the results.

In the meantime, C&WJCCUL has offered an ongoing moratorium to ease the burden on the affected members. 

“The board and management has assessed the financial implications that may result as the moratoriums expire and [are] confident that the Credit Union remains resilient in it’s response,” directors said.

“[The increased profitability] reflects the management’s deliberate strategy and prudent practices by seizing the opportunities during the time of a crisis”

At year end, interest income grew by over 13 per cent, bringing in JM$2.0 billion compared to JM$1.8 billion for the corresponding period in 2019. 

Keeping costs down

Managers stated that cost management continues to be a high priority of the credit union. 

Interest expenses declined by five per cent for the year compared to the corresponding period in 2019. The total cost of funds for the year ended at JM$344 million compared to JM$361 million in 2019. 

The exterior of the Community & Workers of Jamaica Credit Union Limited’s headquarters oin St Andrew, Jamaica (Photo: Foursquare

Non-interest income declined on the back of reductions in fees as well as non recurring activities in 2020, such as the sale of properties, which occurred in the 2019 financial year. 

Non-interest income fell from JM$537 million in 2019 compared to the JM$327 million earned in 2020. 

Operating expenses declined, management said, from a deliberate cost reduction strategy employed in response to the crisis brought on by the pandemic. 

Compared to the prior period, expenses of JM$1.44 billion reduced by JM$36 million for the year ended December 31, 2020.

A strong balance sheet

Total assets grew by 10 per cent for the year moving from JM$17.8 billion to JM$19.4 billion, an increase of JM$1.7 billion. 

There was a  moderate 3.4 per cent growth in the loan portfolio which, as at December 31, 2020, stood at JM$13.1 billion. 

C&WJCCUL’s savings portfolio also grew significantly, by 12 per cent for the year or an increase of JM$1.6 billion, to JM$15.0 billion at the year end.

In response, management remarked: “The credit union applauds the commitment of our members and the confidence they have garnered as evidenced by their continued saving with a resilient financial institution.”

Moreover, the credit union had liquidity of JM$3.3 billion, which represented a liquidity ratio of 22 per cent, up from $2.2 billion or 16.2 per cent in 2019.

The total capital base at year end was JM$3.4 billion as at December 31, 2020, falling well within regulatory requirements, management noted.