2019 Message from our President –  Mr Alvan Haynes.

A hearty welcome to all attending the 73^rd Annual General Meeting of St. John’s Credit Union.  It is again my special privilege and great pleasure to welcome each of you – members, invited guests, officers, and staff. Please know that your attendance is really appreciated.

SJCU continued to transform and strengthen during the period from April 01, 2018 to March 31, 2019. I will talk about our achievements shortly, but first I must describe the changing and challenging environment we face.

Members, I want to start out by telling you that our credit union movement is challenged. The challenges come from multiple sources – the liquid commercial banks, the hustlers (payday loans, the loan sharks), large merchandisers (like Courts), powerful international regulations (AML, IFRS), and then, perhaps, worst of all, from some within our own membership.

The first challenge comes from the commercial banks, who having excess liquidity, have been targeting our membership with attractive loan rates and offers where no collateral is needed. They target members who they know have the capacity and established borrowing history. In a few minutes, I will tell you why getting members to accept such offers is a big win for them, but not for us, and definitely not for the members who accept such offers.

Secondly, payday loans and loan sharks have always been sniping at our members, offering quick and easy, but expensive and entrapping loans.  Now the merchandisers who offer credit have joined in, trying to attract members by offering quick and easy loans! Members, I urge you to always do the math before agreeing to take on such loans, many of which will result in you paying interest rates well in excess of 25% or even 50% on an annual basis!

Thirdly, with respect to challenges, there seems to be a continuing stream of newer tougher regulations, mostly originating from the world’s more powerful nations. On top of the Anti-Money Laundering/Countering Financing for Terrorism (AML/CFT) and monthly regulatory reporting requirements, we now have the new International Financial Reporting Standards, in particular IFRS9, which will require much more stringent treatment of delinquent loans. Last year, we reported on the closure of Civil Service Credit Union and the losses and concerns this caused. This year, the Belize financial sector has seen the closure of two international banks, with at least one caused due to restrictions placed on it by external regulatory agencies. Please note that SJCU supports the implementation of tougher and more rigorous standards to help with protection of members’ savings and the credit union movement in general. However, implementing such new regulations come at a significant cost which includes training, additional staff, additional computer software systems and new and more complicated procedures, which often annoy members. Anyone who has tried to move money internationally will know what I am talking about.

Finally, sad to say, the one that hurts us the most is delinquency from our own members which continues to plague us and almost all other credit unions. At March 2019, our delinquency rate was 7.66%. We continue to offer understanding and support to members who experience serious situations and must commend those who come in to inform us of adverse changes which affect their ability to repay; we will willingly work with such members.  The other ‘hard-pay’ members cost the credit union and reduce the earnings, and therefore the dividends and rebates to all the rest of us. I therefore implore each of you to remind all borrowers of their obligations – a credit union is a cooperative – part of our success is cooperating, which includes living up to our commitments.

Having said all that, please let me reassure you that SJCU, and the credit union movement as a whole, remains strong.  I remind you that the Central Bank of Belize, as the Regulator of Credit Unions, publishes quarterly reports on the active credit unions so that everyone can easily verify the stability of these credit unions, your credit union included. Furthermore, the Board of Directors and officers of SJCU continue to be diligent in executing our fiscal and fiduciary responsibilities, including reporting to, and liaising with, the regulator, to ensure that our SJCU meets the required safe operating parameters as defined by both the Central Bank and the World Council of Credit Unions.

Despite all these challenges mentioned, SJCU had another very successful year.

We are pleased to report that SJCU has met and exceeded the required Net Institutional Capital ratio of 10%. Also, we have maintained our full loan loss provisioning throughout the year, even though this has reduced our earnings.  However, by ensuring full compliance, we ensure the strength of our credit union and security of members’ funds, which we all must realize is of paramount importance.

Our Strategic planning execution continues to expand and develop our credit union.  Our new North Side branch has been operating for more than a year. The one sore point was the ATM, which, though received in May last year, appears to be too new and modern to integrate into the network of older ATM’s. We are hoping to have this issue solved shortly.

We continue to update our Strategic Plan and execute various strategic initiatives. We continued the strengthening of our institutional capacity, designing new loan products, planning marketing activities, revising policies to better meet your needs, and ensuring operational efficiency. All of these combined are helping to make us better prepared for further growth and development.

After performing an in-depth analysis of the important changes we need to make, we tackled the most fearsome one – the change-out of our core computerised banking and members system. With really outstanding teamwork and support from officers and staff alike, we achieved this major task in record time, with the change-over occurring at the end of February 2019. This new system will support us in offering many new services and features to you our members, including a much improved on-line interface, and for the first time in Belize for a credit union – mobile banking!  I am sure many of you here are already taking advantage of this new feature.

We are pleased to report that for the year 2018/19, we have grown in membership, assets and in loan portfolio; we have maintained profitability, increased institutional capital, controlled delinquency, lowered interest rates and improved dividends.

Apart from helping us to reach the targeted Net Institutional Capital, our strategy has led to continued high growth – in the seven years of execution since 2012, we have increased membership 57.6%, Shares by 134.9%, Assets by 137.7%, and Loans by 173.5%. This year’s gross income shows a .30% increase over the previous year’s, and an amazing 127.4% higher than the 2012 revenue figure! Staff, Officers and members deserve congratulations for these outstanding results.

The Board of Directors of SJCU continues working, in conjunction with the regulator, to ensure that our SJCU meets all safe operating parameters. Monitoring and compliance continue to be key areas of focus.  Our Supervisory Committee, aided by the Compliance Officer and Internal Auditor, continue to monitor operational activities in order to ensure our compliance to regulations and policies to safeguard our institution.

The Loans department and the Credit Committee continue to drive the earnings side of the activities of the credit union, processing an increased number of loans and analysing member’s needs. We are pleased to have commenced offering lower, more competitive rates on our loan products, including consolidation loans.

Before I close, let me go back to the explanation I promised on why members who switch to other institutions are making a losing decision. It is simply this, with those institutions, you can’t have your cake and eat it too. As our own Ms. Brenda Armstrong explains in one of our promotional videos, those other institutions are there with a primary purpose of making money off you. Their evil genius plan is to take as much of your money from you as they can, leaving you worse off at the end of the day.

Well, here is perhaps the world’s best kept secret – with the magic of your credit union, you can actually have your cake and eat it too! It’s as simple as this – with your credit union, we advise you to continue to save. Rather than withdraw your shares when you need extra funds, you borrow and continue to build up your shares, even if more slowly. Annually, you get back dividends and rebates. At the end of the day, your savings have grown and you have earned additional funds! When you borrow from other institutions, you pay always, earn nothing, and end up with a zero balance! Tell me, which one makes more sense?

Members, I urge you to share this secret with your family, your friends, your co-workers and others. This secret is just one part of the credit union advantage – the other includes the many free and supportive services we offer.

At SJCU, we recognize the critical role that our credit union plays in bringing financial services to many who would not otherwise get such services. Apart from providing banking services and loans to members, we provide a platform for members to save and invest, providing returns in the form of dividends and interest, but more importantly providing many other benefits, including free financial advice and guidance to encourage members to grow their savings and assets. Since our establishment in 1946, SJCU has continued to grow in membership, in services, and in attitude, providing “safe savings … smart borrowing” to generations of Belizeans. We commit to continue growing, to be there providing unparalleled services and a financial safety net to our members into the future. We thank those thousands of members who save and utilize the credit union services to their advantage. We especially thank those of you, who continue to be active in participating in the Credit Union – at AGMs, using the various services offered by the credit union, and most importantly, providing feedback, so we can improve further.

As always, I take this opportunity to commend the dedicated efforts of officers and staff. I also take this opportunity to extend a special welcome to all our new staff and all our new members who have joined us since last AGM.

I thank you all for attending. Members, we thank you for your continued support, which helps to guarantee the continuing success of St. John’s Credit Union, our Credit Union.