ECCB 2014-2015 Annual Report and Statement of Accounts

EASTERN CARIBBEAN CENTRAL BANK

Eastern Caribbean Central Bank Notes to Consolidated Financial Statements March 31, 2015

(expressed in Eastern Caribbean dollars) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (expressed in Eastern Caribbean dollars) March 31, 2015

20. Other reserves

20.

Other reserves

2015 $

2014 $

82,106,312 20,517,000 17,300,883 10,980,827 6,537,928 1,808,877

Property, plant and equipment revaluation reserve

70,507,471 17,572,000 (4,198,764) 10,980,827 6,537,928 1,808,877 218,350

Pension reserve

Unrealised holding gain (loss) - investment securities

Self-insurance reserve fund

Capital reserve

Export Credit Guarantee fund

(1,765)

Unrealised holding (loss) gain – money market instruments

Total reserves

139,250,062

103,426,689

Export Credit Guarantee fund

Export Credit Guarantee fund Under Article 42 (1) of the Eastern Caribbean Central Bank Agreement Act 1983, the Bank is empowered to administer or participate in an export credit guarantee scheme. In exercise of this power, the Bank has assigned to one of its departments, the objective of providing pre-shipment export credit guarantees to commercial banks in respect of advances made to exporters from the Organisation of Eastern Caribbean States. Article 42 (4) of the Eastern Caribbean Central Bank Agreement Act 1983 provides for the Bank to make discretionary contributions out of its profits towards a guarantee fund for administering the Export Credit Guarantee Scheme. The Board of Directors have agreed to maintain the fund at a minimum of $1,000,000. Capital reserve Capital reserve inclu des the land (8.3568 acres) on which the Bank’s headquarters (phase I and II) are constructed, which was donated by the Government of St. Kitts and Nevis. The land was independently valued at $629,528 in 1991 for phase I and $2,720,000 in 2001 for phase II. In 2003 the Government of St. Kitts and Nevis donated an additional 0.61 acres to the Bank, which has been independently valued at $498,400. In 2005, the Government of St. Kitts and Nevis donated an additional 2 acres of land which has been independently valued at $2,690,000. Self-insurance reserve The Board of Directors have agreed to appropriate annually to Self-insurance Reserve, from net income, such amount equivalent to the quoted premium from an insurance carrier, to cover potential catastrophe in respect of the Bank’s headquarters buildings and full coverage for the other properties. It also agreed to a funded cap of 20% of the replacement value of the relevant buildings (determined by independent valuation). Pension reserve The Board of Directors have decided to make appropriations annually to or from net income for the amounts necessary to maintain a pension reserve equivalent to the pension asset. Under Article 42 (1) of the Eastern Caribbean Central Bank Agreement Act 1983, the Bank is empowered to administer or participate in an export credit guarantee scheme. In exercise of this power, the Bank has assigned to one of its departments, the objective of providing pre-shipment export credit guarantees to commercial banks in respect of advances ade to exporters from the Organisation of E st rn Caribbean States. Article 42 (4) of the Eastern Caribbean Central Bank Agreement Act 1983 provides for the Bank to make discretionary contributions out of its profits towards a guarantee fund for administering the Export Credit Guarantee Scheme. The Board of Directors have agreed to maintain the fund at a minimum of $1,000,000. Capital reserve Capital reserve includes the land (8.3568 acres) on which the Bank’s headquarters (phase I and II) are constructed, which was donated by the Government of St. Kitts and Nevis. The land was independently valued at $629,528 in 1991 for phase I and $2,720,000 in 2001 for phase II. In 2003 the Government of St. Kitts and Nevis donated an addition l 0. 1 acres to the Bank, w ich has been independently valued at $498,400 In 2 5, th r ent of St. Kitts and Nevis donate a ad ition l 2 acres of land which has b en independently valued at $2,690,000. Self-insurance reserve The Board of Directors have agreed to appropriate annually to Self-insurance Reserve, from net income, such amount equivalent to the quoted premium from an insurance carrier, to cover potential catastrophe in respect of the Bank’s headquarters buildings and full coverage for the other properties. It also agreed to a funded cap of 20% of the replacement value of the relevant buildings (determined by independent valuation). Pension reserve The Board of Directors have decided to make appropriations annually to or from net income for the amounts necessary to maintain a pension reserve equivalent to the pension asset.

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ECCB ANNUAL REPORT 2014/2015