Disclaimer: The views and opinions expressed by the author(s) do not represent the official position of Barbados TODAY.
by Michael D Carrington, former employee and past president of BPWCCUL
A credit union is a group of people connected by a common bond and people who save together and lend to each other at a reasonable rate of interest. The members have control over finances and make their finances work for them.
The credit union (BPWCCUL) was registered in 1970 and re-registered with its current name in 1970.
The credit union has experienced significant growth in its asset base, which increased from $907M in 2012 to $1,932M in 2022, quite a significant achievement for any financial institution with 107,506 members on March 31, 2022.
Size also carries other economic and regulatory consequences and on May 06, 2022, the Central Bank of Barbados (CBB) designated the credit union as a “systemically important financial institution”.
It came under the joint regulation of the CBB and the Financial Services Commission, thereby creating an enhanced level of regulation and oversight, which should provide members with an additional level of comfort.
Credit unions are major deposit-taking institutions and rely on public trust for continued operations and such trust, coupled with due diligence and a regulatory framework, provides enhanced confidence of depositors and members at large.
The challenge of such trust should be supported with statistics and raw data, which leads to logical conclusions rather than solicitation of data through mischievous questions and circulation of alternative facts in social media. (The CBB and FSC should be commended for their prompt and joint response). Such attempts to undermine indigenous institutions should not be encouraged.
Currently, credit unions are the only indigenous financial institutions in Barbados and there are cries for an indigenous bank to support the local business sector. Our only hope lies in these credit unions.
Maybe the day is not too far when Capita can transition to a merchant bank or other bank in a similar fashion as Consolidated Finance transitioned to Ansa Merchant Bank.
In the area of fees paid to directors, it would be prudent to compare fees paid to members of statutory boards, government-owned or controlled corporations and entities, local financial institutions, and entities of comparative size relative to their industry. After such data is collated and analysed, persons can make an informed judgement as to the reasonableness or otherwise of the fees paid to directors.
Continuing with directors’ fees, the Sunday Sun of January 15, 2023 stated that the retainer fees for the Chairman and non-executive directors of Goddards Enterprises Limited were $32, 000 and $16, 000 respectively per annum plus additional fees for attending board, committee and joint venture meetings. These fees were fixed in 2016 and will be revisited at the January 2023 meeting of shareholders.
Notwithstanding the above, the credit union should ensure that it has skilled professional staff, a sound system of internal control, a robust due diligence environment and the implementation of enhanced monitoring of its subsidiaries and set the fees for elected officers at the annual general meeting. Such measures would undoubtedly strengthen the members’ perception of the credit union and provide additional safety, security and soundness.
Servitude should be relegated to oblivion rather than clouding our vision of the future. Our common bond should be cohesive rather than divisive. There is strength in unity and as Mattie Stepanek wrote: “Unity is strength… When there is teamwork and collaboration, wonderful things can be achieved.” We should move forward with the confidence that our credit union can continue to grow and achieve wonderful things in the foreseeable future.
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