FirstCaribbean International Bank (Bahamas) Limited
FirstCaribbean International Bank (Bahamas) Limited FirstCaribbean International Bank (Bahamas) Limited
Notes to Consolidated Financial StatementsFor the year ended October 31, 2009(Expressed in thousands of Bahamian dollars)21. Dividends Paid2009 2008Declared and paid during the yearFirst dividend $0.20 (2008-$0.25) $ 24,043 $ 30,054Final dividend $0.15 (2008-$0.20) 18,033 24,043Total dividends declared and paid $ 42,076 $ 54,097At the Board of Directors meeting held on December 15, 2009, a final dividend of $0.16 per share amounting to $19,235in respect of the 2009 net income was proposed and declared. The consolidated financial statements for the year endedOctober 31, 2009 do not reflect this resolution, which will be accounted for in equity as a distribution of retained earningsin the year ending October 31, 2010.22. Related Party Transactions and BalancesAs discussed in Note 1, the Bank’s Parent and major shareholder is FirstCaribbean International Bank Limited who owns95.2% of the Bank’s ordinary shares. From October 11, 2002, FCIB’s major shareholders were jointly CIBC and Barclays.On December 22, 2006, CIBC acquired Barclays’s interest in FCIB and now owns 91.4% of the shares of The Bank’s Parent(FCIB). The remaining shares are widely held.A number of banking transactions are entered into with related parties in the normal course of business. Outstanding balancesat year-end and transactions during the year are as follows:Directors and key Major shareholder Ultimatemanagement personnel and associated banks Shareholder2009 2008 2009 2008 2009 2008$ $ $ $ $ $Balances:Due from banks – – 116,930 12,682 73,875 2,921Loans and advancesto customers 2,715 3,025 – 89,278 – –Other assets – – 11 – 570 –Deposit liabilities 5,418 5,150 477,564 696,500 158 3,025Other liabilities – – 3,457 2,794 102 –Transactions:Interest incomeearned 105 141 2,580 4,493 392 6,829Interest expenseincurred 258 185 15,380 25,294 472 18,112Other income – – – – 16,247 –Other expenses* – – 3,447 2,300 1,294 68* Expenses incurred in relation to banking and support services.Key management compensation2009 2008Salaries and short term benefits $ 2,715 $ 2,356Directors’ remunerationIn 2009, the total remuneration of the directors was $40 (2008: $40).50
Notes to Consolidated Financial StatementsFor the year ended October 31, 2009(Expressed in thousands of Bahamian dollars)23. Contingent Liabilities and CommitmentsThe Bank conducts business that involves guarantees, performance bonds and indemnities, which are not reflected in theconsolidated balance sheet. At the consolidated balance sheet date the following contingent liabilities and commitmentsexist:2009 2008Letters of credit $ 47,840 $ 45,558Loan commitments (Note 26) 198,476 214,596Guarantees and indemnities 47,055 42,466$ 293,371 $ 302,620The Bank is the subject of legal actions arising in the normal course of business. Management considers that the liability ofthese actions, if any, would not be material. (Also see Note 26).On December 19, 2008, the Bank entered into a $250 million credit facility with CIBC for general corporate purposes andthe Bank is expected to treat the facility as back up liquidity facility. The maturity date is 364 days from the closing datewith extension privileges for an additional 364 days. Advances would be available as LIBOR rate advances or Base Rate(Canada) Advances. Interest rates are at LIBOR + 300bps (pricing grid to be develop based on external ratings) or US Baserate +200 bps (pricing grid to be develop based on external ratings). As of October 31, 2009, no advances were made fromthe facility; all balances are undrawn.24. Future Rental Commitments under Operating LeasesAs at October 31, 2009, the Bank held leases on buildings for extended periods. The future rental commitments underthese leases are as follows:2009 2008Not later than 1 year $ 2,912 $ 3,097Later than 1 year and not more than 5 years 4,693 5,064Later than 5 years 126 68825. Business Segments$ 7,731 $ 8,849Effective November 1, 2008, the Bank re-organised its lines of business by streamlining from five to two lines of businessto establish a more customer-centric organization with greater emphasis on collaboration and sharing of knowledge,improved productivity and innovation.The previous five main lines of business were Retail Banking, Credit Card Banking, Corporate Banking, Wealth Management,and Capital Markets. The two new lines of business are called Retail & Wealth Management (R&WM) and CorporateInvestment Banking (CIB) and are supported by two separately reportable functional operating units, namely the TreasuryGroup (TST) and Other (which includes support functions such as Operations and Technology, Finance, Human Resources,and Risk).The Wealth Management line of business was segregated and merged as follows:• Personal Wealth and International Mortgage business were merged as part of R&WM; and• Corporate International Wealth business was merged as part of Corporate Banking under CIB.51
- Page 5 and 6: Executive ChairmanMichael K. Mansoo
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Notes to Consolidated Financial StatementsFor the year ended October 31, 2009(Expressed in thousands of Bahamian dollars)21. Dividends Paid2009 2008Declared and paid during the yearFirst dividend $0.20 (2008-$0.25) $ 24,043 $ 30,054Final dividend $0.15 (2008-$0.20) 18,033 24,043Total dividends declared and paid $ 42,076 $ 54,097At the Board of Directors meeting held on December 15, 2009, a final dividend of $0.16 per share amounting to $19,235in respect of the 2009 net income was proposed and declared. The consolidated financial statements for the year endedOctober 31, 2009 do not reflect this resolution, which will be accounted for in equity as a distribution of retained earningsin the year ending October 31, 2010.22. Related Party Transactions and BalancesAs discussed in Note 1, the <strong>Bank</strong>’s Parent and major shareholder is <strong>FirstCaribbean</strong> <strong>International</strong> <strong>Bank</strong> <strong>Limited</strong> who owns95.2% of the <strong>Bank</strong>’s ordinary shares. From October 11, 2002, FCIB’s major shareholders were jointly CIBC and Barclays.On December 22, 2006, CIBC acquired Barclays’s interest in FCIB and now owns 91.4% of the shares of The <strong>Bank</strong>’s Parent(FCIB). The remaining shares are widely held.A number of banking transactions are entered into with related parties in the normal course of business. Outstanding balancesat year-end and transactions during the year are as follows:Directors and key Major shareholder Ultimatemanagement personnel and associated banks Shareholder2009 2008 2009 2008 2009 2008$ $ $ $ $ $Balances:Due from banks – – 116,930 12,682 73,875 2,921Loans and advancesto customers 2,715 3,025 – 89,278 – –Other assets – – 11 – 570 –Deposit liabilities 5,418 5,150 477,564 696,500 158 3,025Other liabilities – – 3,457 2,794 102 –Transactions:Interest incomeearned 105 141 2,580 4,493 392 6,829Interest expenseincurred 258 185 15,380 25,294 472 18,112Other income – – – – 16,247 –Other expenses* – – 3,447 2,300 1,294 68* Expenses incurred in relation to banking and support services.Key management compensation2009 2008Salaries and short term benefits $ 2,715 $ 2,356Directors’ remunerationIn 2009, the total remuneration of the directors was $40 (2008: $40).50
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