Issuu

Page Vision, Mission

Notice of Annual General Meeting and Agenda

Profile - First Heritage Co-operative Credit Union Limited

Life Charter - Products & Services

Minutes of Annual General Meeting

Board of Directors

Report of the Board of Directors

Management Discussion

Report of the Treasurer

FINANCIAL STATEMENTS

Report of the Supervisory Committee

135

Report of the Credit Committee

139

Report of the Nominating Committee

142

Highlights of FHC’s Reading Week 2015

148

Report of the Delegates on JCCUL’s AGM

149

Unit and Branch Managers

154

Parliamentary Rules of Order

156

Obituaries

159

Prayer of St. Francis of Assisi

160

Notes

162

Notice is hereby given that the 4th Annual General Meeting of the First Heritage Co-operative Credit Union Limited will be held on Thursday, May 12, 2016 at the Jamaica Conference Centre, 14-20 Port Royal Street, Kingston beginning at 3:00 p.m. Registration commences at 2:00 p.m. All members are invited. ________________________ Edmund Jones Secretary, Board of Directors

Ascertainment of Quorum Call to Order and Prayer Chairman’s Opening Remarks and Obituaries Reading and Confirmation of the Minutes of the Annual General Meeting held on Tuesday, May 12, 2015 REPORTS: Board of Directors Management Treasurer and Auditor Credit Committee Supervisory Committee ELECTIONS: Nominating Committee Report Elections to: Board of Directors Credit Committee Supervisory Committee Recommended Rules Changes Any Other Business Vote of Thanks Adjournment

irst Heritage Co-operative Credit Union Limited (FHC) was formed on August 1st, 2012 from the merger of GSB Co-operative Credit Union Limited and Churches Co-operative Credit Union Limited. On March 1, 2015, the business and operations of St. Thomas Cooperative Credit Union Limited was transferred to FHC and the Credit Union’s asset base as at December 31, 2015 was $10.11B.

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FHC’s bond include: a) All members of any religious bodies and affiliations in Jamaica and their families/relatives; b) all Public Sector Employees, past and present, regardless of their terms of tenure, employed to Ministries/Departments/Agencies/Statutory Bodies/Public Corporations and their families/relatives; c) all Professionals, their families/relatives and their employees and their families/relatives; d) all members of Professional Associations affiliated to the Public Sector, their families/relatives and the employees of these Professional Associations and their families/relatives; e) all Public Sector Consultants and their families/relatives; f) all Public Sector Contractors and their families/relatives; g) employees, past and present, of the Credit Union and their families/relatives; h) all Registered Co-operative Societies and members of these Societies. The Credit Union has a membership base of just over 191,000 across a network of twelve (12) locations strategically located across the Island, offering a suite of thirty-nine (39) products and services. Our extensive array of products and services include a variety of loans, deposits, savings and investment options from our subsidiary, FHC Investments Limited (FHCIL), Retirement Planning Scheme (Pension Gold) and Micro and Small Business loan financing. Our products and services are specifically designed to meet the needs of members at every stage of their lives.

FHC Investments Limited (FHCIL) FHC Investments Limited (FHCIL) is a limited liability company and a wholly owned subsidiary of First Heritage Co-operative Credit Union Limited (FHC), established to

provide investment opportunities for members and non- members of the Credit Union as well as to manage the investments of the Parent. It is located at Suite 27, Winchester Business Centre, 15 Hope Road, Kingston 10. The company’s products and service may also be accessed through representatives at several FHC branch locations. The company offer competitive rates of return and success-driven portfolio management services to its clients by a team of industry experts with over 30 years of combined experience. FHCIL provides insightful and comprehensive information on their products and services to meet the needs of clients. These include: Products Equities (local and foreign) Bonds (local and foreign) Mutual Funds Corporate Financing Money Market Instruments Services Portfolio Management Investment Advisory Retirement Planning The investment company has products and services for the conservative investors as well as those with a greater risk appetite, some of which are offered in both foreign and local currency. FHCIL is also the Investment Manager and Administrator of the Credit Union’s Retirement Scheme. The company’s total funds under management currently stand at $2.1 B. Retirement Planning Scheme The Churches Co-operative Credit Union Retirement Scheme referred to as “the Scheme” was established by Churches Co-operative Credit Union Limited as a defined contribution plan with effect from June 1, 2004 by Trust Deed to provide pension benefits for members and their beneficiaries at retirement and ancillary benefits in the event of death or termination. Since August 1, 2012, FHCIL has been the Administrator and Investment Manager of the Scheme. Between December 2012 and December 2015, the Gross Value grew by over 88% from approximately $339M to $638M with membership as at December 2015 year end totaling in excess of 4,265 individuals including 47 Pensioners. The strategic objective of the Scheme is to ensure that more Jamaicans who have a retirement plan to which they are consistently contributing thus safeguarding their retirement.

Micro and Small Business Financing FHC’s Micro and Small Business Loan outfit reflects a renewed commitment on the part of the Credit Union to foster the growth of entrepreneurship in Jamaica as a major driver of the economy. It also reflects the decision of FHC to widen the scope of its services and diversify its product range in a formal and definite way to provide more specific and

targeted entrepreneurial opportunities. This will serve to increase employment, the standard of living of borrowing members and also contribute to the GDP of the country. The Micro and Small Business Unit was created in 2006 and since then, this Unit has disbursed over 6509 loans to members totalling over $543M. It currently has a portfolio of approximately $273M. It is FHC’s strong belief that a strategy embodied by the spirit of entrepreneurship is vital for the stimulation of our economy. The Credit Union’s Micro and Small Business units are located in Kingston, May Pen, Montego Bay, Mandeville and Spanish Town and St. Thomas. The unit is a member of the Caribbean Micro Finance Alliance which acts as a catalyst for the development of Micro finance in the Caribbean. The unit was recognized worldwide as a finalist in the Caribbean Micro Finance Competition in 2012 for its impact in Jamaica. Jamaicans have a rich entrepreneurial spirit and FHC is the home for financing these opportunities. FHC aims to be a one-stop financial institution with diversified products and services to meet the needs of valued members at every stage of life. The Credit Union’s commitment remains, to generate continual benefits to our valued members and other stakeholders.

MINUTES OF MEETING FOR THE 3rd ANNUAL GENERAL MEETING THE FIRST HERITAGE CO-OPERATIVE CREDIT UNION LIMITED HELD ON TUESDAY, MAY 12, 2015 AT THE JAMAICA CONFERENCE CENTRE, 14 – 20 PORT ROYAL STREET, KINGSTON

1. Ascertainment of Quorum & Call to Order Having ascertained that a quorum (constituting 190 registered members) was present, the Chairman, Mr. Orville Hill called the meeting to order at 3:08 p.m. and invited the Secretary of the Board of Directors, Mr. Edmund Jones, to read the Notice convening the meeting.

2. Invocation The Chairman invited Rev. Rudolph Cox who offered prayer and asked for divine guidance on the proceedings to follow. Everyone was then invited to stand for the singing of the National Anthem.

3. Welcome, Opening Remarks and Tributes The Chairman welcomed all members to the 3rd Annual General Meeting (AGM) and momentarily reflected on the birth of the organization on August 1, 2012. He commended the Marketing Department for their effort in effectively establishing First Heritage Cooperative Credit Union Limited (FHC) as a formidable institution with a long history that belies the reality of its three-year existence. The Chairman then gave special recognition and welcome to the members of the former St. Thomas Cooperative Credit Union Limited who are now members of the FHC Family since the Transfer of Engagement of St. Thomas Co-operative Credit Union Limited on March 1, 2015, and asked them to stand to be officially recognized. He then drew members’ attention to the Parliamentary Rules laid out on pages 160 to 162 of the Annual Report which would be used to guide the meeting’s proceedings. The Chairman then introduced, by name and positions, all Board members present, members of the Supervisory and Credit Committees, members of the Executive and the Management teams and further apologized for those members who would be late and/or absent.

The Chairman also specially acknowledged recently retired GM Credit Administration, Miss Janyce Robinson, and thanked her for her significant contribution to the organization over the years. Special mention was also made of the contribution of Mrs. Rose-Marie Samuels, HR Manager who had assumed the Human Resource portfolio in the absence of Mrs. Gillian Gayle, GM Human Resources, who was ill and is presently recuperating. The Chairman then invited all members to stand to observe a minute of silence in honour of those members of the credit union who passed on during the year. The Secretary was then invited to extend welcome all specially invited guests and to read the minutes of the 2nd AGM. The Secretary welcomed all specially invited guests from the Department of Cooperatives and Friendly Societies, Jamaica Cooperative Credit Union League and our Auditors from KPMG, all of whom were all asked to stand to be officially recognized. Mr. Jones then invited the meeting to specially recognize the Credit Union’s Liaison Officers as well as representatives from FHC’s Junior Credit Union Programme which is currently operational in three high schools: Greater Portmore High, Willowdene High and Dinthill Technical High.

4. Apologies for Absence 12

Apologies for absence were tendered for Mr. O'Neil Grant, 2nd Vice Chairman, FHC.

5. Apologies for Lateness Apologies for lateness were tendered for Mr. Kevin Forbes, Assistant Treasurer and Mrs. Tamara Riley-Dunn, Board Director.

6. Reading & Correction of the Minutes of the AGM Minutes of the 2nd AGM, having been circulated were taken as read on a motion moved by Rev. Major Kildare, and seconded by Ms. Marcia Lewis. The Secretary took the meeting through the corrections. Mr. Michael Burke noted, on page 26, the omission of the vote that was carried regarding a Board-elected delegate to the League. It was however pointed out by another member that the vote was in fact mentioned later in the minutes. On the same page and the same matter as presented by Mr. Burke, Mr. Johnathan Brown suggested the rewording of the sentence as ‘the responsibility for that decision remains with the Board.” Mr. Michael Burke however vetoed that suggestion and asked that it remain the same as it was only for that meeting. The Secretary reminded him that the correction would do no harm as no decision is permanent, as they can be changed by the membership.

Ms. Linda Wilson referred to page 28 and asked that ‘Mr. Wilson’ be changed to ‘Ms. Wilson’ as she was the person who spoke. These suggestions were accepted by Mr. Jones. There being no further amendments, a motion to accept the minutes as corrected was moved by Mrs. Asre Stewart-Blake, seconded by Mr. Carl Winham.

7. Reading and Corrections of Minutes. Mr. Jones asked for a motion to accept the minutes of the Special General Meeting (SGM) to consider the Acceptance of the Transfer of Engagement of the St. Thomas Cooperative Credit Union Limited to First Heritage Cooperative Credit Union Limited as read and this was moved by Rev. Major Garnet Kildaire, seconded by Ms. Juliet Dacosta. The following amendment was noted by the Secretary: On page 29 the date should read December 29, 2014. There being no further corrections to the addendum minutes, a motion to accept as corrected was moved by Miss Abigail Darby, and seconded by Mrs. Veronica Haughton Campbell. The Secretary then handed over the meeting to the Chairman. The Chairman then asked if there were any matters arising from the minutes for discussions or further questions from the floor. Mr. Burke revisited the matter of choosing delegates for the League. He referred to the fact that, as a former GSB member, he was a member-elected delegate to the League and queried FHC’s position on the matter. The Chairman explained that as a form of best practice, delegates to the League should preferably be persons who are privy to matters discussed in the Boardroom, but, notwithstanding, concluded that the ultimate decision rests with the members. He further stated that if the members wished to elect a delegate from the floor, it would be their right and the Board would be obligated to carry out this instruction. Mr. Clarkson, Mr. Earl White and other members, voiced their concern over the lack of bathroom facilities within branches. Mr. Quilston Harrison, GM Operations, Risk, Information Systems and Facilities who responded, advised that, while free-access bathroom facilities cannot be accommodated due to security and space restrictions, members with emergencies would be facilitated. Mr. Burke expressed his displeasure at the fact that his request from last year’s AGM regarding the extension of closing hours on Fridays, was not yet implemented. He strongly urged that this matter be treated with great urgency. The Chairman promised that discussions will be initiated by management to evaluate and make a decision on this proposal. Rev. Major Kildare questioned the progress of the Benevolent Society that was suggested by Mr. Michael Burke at the last AGM, to which Mr. Burke advised that despite some setbacks that were being experienced, discussions were still underway. Rev. Major Kildare further enquired about the process of becoming a beneficiary of the FHC Foundation.

The Chairman responded by explaining that currently, only charitable organizations were supported and that individual members were not eligible to be beneficiaries. Mr. Burke questioned the possibility of the Foundation becoming an employment agent. The Chairman responded that this was not currently part of the Credit Union’s mandate. Mr. Rupert Brown mentioned the recurrence of late salary deduction postings to members’ accounts despite personally dropping off the deductions. Mrs. Karlene Simpson responded that deductions are generally processed within 24 hours but promised to investigate this specific matter further. Mrs. Williams - Barrant, a former member of St. Thomas Credit Union, referred to a concern that was raised by Mr. Burke in last year’s SGM regarding the implications of the St. Thomas/FHC Credit Union merger. She questioned the basis of his concern. Mr. Burke explained that there was no ill intent in raising the concern as he was only trying to obtain the rationale of the merger from the Board. There being no further matters arising from the minutes of the AGM, the Chairman then presented a summary of the Board of Directors’ Report.

8. Board of Directors’ Report 14

The Chairman commented briefly on the relatively slow growth in the economy and the Central Bank’s efforts to manage liquidity in the market. He made mention also of the delay in the transition for regulatory control of Credit Unions to the Central Bank and advised that while this delay persisted, the Credit Union continued to strengthen its operations. The Chairman spoke to the inflation rate which was restricted to 6.4%, reflecting a 3.1% variance to last year’s 9.5%. Against this background, the Chairman reported that the Group’s Net Surplus was $103.9 million, which represented a 5.2% increase when compared to last year. He reported a reduction of fees and commissions by $34.1 million or 19.3% and stated that Assets were $8.80 billion while Earning Assets stood at $7.8 billion. In relation to the performance of the Credit Union’s Subsidiary, FHC Investments Limited, the Chairman reported $2.1 billion under management. He encouraged all members to be a part of this investment arm, where opportunities exist for not only local currency but for foreign currency denominated investments. The Chairman reminded the meeting that a name change for the Retirement Scheme is urgently required. He explained, however that to vote for such a change, the law required the achievement of a quorum of 50% plus one at an AGM. This, he added was an elusive goal, as the attendance at the Retirement Scheme’s AGMs have usually been far below the quorum stipulation, thus preventing decisions such as these, to be made. He stated that efforts are being made to lobby the government for a modification of the Act that governs Retirement Schemes in Jamaica. Notwithstanding, the Chairman reported that, as at December 31, 2014, the Retirement Scheme reported $486 million under management with 4,186 registered members and 51 pensioners receiving pension payouts.

The Chairman re-emphasized the Credit Union’s promise to identify and implement the distinctions that will build customer loyalty, as well as to establish customer service standards of excellence which must form part of the organization’s strategic goals. He then gave special thanks to the many partners such as the Department of Co-operatives and Friendly Societies, the Jamaica Co-operative Credit Union League, Auditors KPMG, National Union of Cooperative Societies, volunteers and management team for their invaluable support throughout the year. In closing, the Chairman spoke of the strength of the organization and reflected on his involvement prior to and after the merger of GSB and Churches Credit Unions. He then advised the meeting that, moving forward, he would not be available for consideration to serve on the Board of Directors. He however, expressed confidence in the Directors who are slated to continue in the strategic leadership, and recognized the competence and capacity of the Management team, who will move the Credit Union from strength to strength. Mr. Hill wished the organization success and thanked the members for the opportunity to have served. He then opened the floor for questions. Ms. Enid Gray queried if scholarships were available in tertiary institutions for public sector workers. The Chairman responded by saying that the Renald Mason Scholarship is one such scholarship and is open to all members regardless of place of work or education level. Rev. Major Kildaire recognized members of the Board who consistently attended Board meetings. They were as follows: Mrs. Beverly Stewart, Mr. Orville Hill, Mrs. Leodis Douglas, Mr. Edmund Jones, Mr. Kevin Forbes and Mr. Balvin Vanriel. He then gave the Chairman special commendation on his sterling contribution to Churches Cooperative Credit Union Limited and subsequently First Heritage Cooperative Credit Union Limited. He suggested that the organization reward him for his service, however the Chairman reminded him that, as volunteers, the giving of self is the basis for service. Mr. Johnathan Brown endorsed Rev. Major Kildaire’s commendation of the Chairman’s significant contribution to the Credit Union. He then asked about Management’s decision to place a hold on unsecured loans. His query was in reference to the approved margins, the person responsible for approving the hold and the basis upon which this decision was taken. He also asked about the overall performance of the portfolio. The Chairman explained that in order to ensure adherence to internal controls and standards set by the Bank of Jamaica, a decision was made to temporarily cease unsecured loans. In terms of its performance, the Chairman advised that the portfolio performed reasonably well and that a robust mechanism was in place to manage delinquency. Mr. Burke rose to make the suggestion that the Credit Union could help its members survive in the harsh economic climate by offering training and employment. He further raised concerns about alleged loan transactions made under questionable circumstances. The Chairman asked Mr. Burke to desist from pursuing his commentary along those lines, to which Mr. Burke obliged.

Mr. Errol Thompson queried the process of interest application to saving accounts and the basis upon which accounts were considered inactive. The Chairman explained the process and invited the member to discuss his account status with a Member Service Representative. There being no other questions or comments, a motion to accept the Board of Directors’ Report was moved by Rev. Major Kildaire, seconded by Ms. Panseta Thomas. The Chairman then asked Mr. Basil Naar, CEO to present the Management’s Report.

9. The Management’s Report

Mr. Naar gave a warm welcome to the members, guests, management team and the newly joined members from the former St. Thomas Credit Union. In his opening remarks, he assured the members that the management was working assiduously to ensure that the Credit Union is ready to, not only be regulated under the Bank of Jamaica, but also to operate as a world class institution. In this vein, he reported that the organization continued to achieve the ‘right fit’ in its hiring practices, improve members' experience and encourage entrepreneurship among members. He stated that the agricultural entrepreneurship opportunity was the driving force that led to the merger with St. Thomas Credit Union Limited and encouraged entrepreneurism as a strategic focus moving forward. The CEO stated that the Micro and Small Business Unit, which started seven years ago, now reports over $300 M in loans and the intention is to grow this portfolio into agriculture. He acknowledged Mr. Burke’s repeated suggestion of the Credit Union assisting in finding employment for its members and reminded the meeting that the Credit Union operates a Skill Bank Registry where members could freely advertise their skills and thus gain meaningful employment. He also reminded the members of the benefits of saving, not only for retirement, but also for wealth generation through the various saving instruments available. The CEO outlined the following achievements throughout the year: • Significant renovations at the Kingston Gardens Branch • New software for FHC Investments Limited • Increased member engagement through community activities, social media, text messages and email • Sponsorship of Annual Reading Days in collaboration with the Jamaica Reading Association • Collaboration with the National Housing Trust to facilitate Micro-Loan seminars • Partnership with the Social Development Commission to facilitate a Small Business Expo • Partnership with the National Youth Service to facilitate Small Business Workshops and consultation sessions with the aim of encouraging people of relatively low net worth to understand how businesses operate. • Collaboration with the Jamaica Civil Service Association to facilitate Civil Service Week • Execution of Labour Day projects • Adoption of the Kiddie Care Basic School • Organization and implementation of Christmas projects for over 300 persons • Establishment of a Corporate Social Responsibility Policy • Sponsorship of numerous charities by the FHC Foundation

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Disbursement of GSAT Scholarships and Grants Disbursement of Entrepreneur Awards/ Grants

In specific reference to the Human Resources Division, the CEO reported that continuous training of leaders and managers was maintained. He reported that the Unit organized a Change Management Workshop for team members, while other programmes including the Summer Internships and Work experience Programmes in collaboration with the HEART Trust NTA were also executed during the year. From the Customer Service and Sales Division, the CEO reported that a Customer Service Relationship Software was recently installed to monitor customer service delivery. He reminded the meeting however, that attaining customer service excellence is a continuous process. He made mention of the activities of the Member Care Centre and Telemarketers who were charged with the responsibility of relating with members in an effort to offer assistance and to reactivate dormant and inactive accounts. He also made special mention of the Youth Savings Programme, and at this juncture, specially welcomed members from the Junior Credit Union Programme who were in attendance. The CEO also specially recognized the officers of the Liaison Officers Programme and expressed appreciation for their contribution in promoting the products and services of the Credit Union within their places of business. In the area of Information Technology, Mr. Naar stated that an Enterprise Risk Management System was implemented to enable the Credit Union to be more responsive to the environment. He explained that the system will allow the organization to be better able to operate in compliance with the Foreign Account Tax Compliance Act (FACTA), which was mandated by the US government to ensure that money held here by residents in the United States, over a certain threshold are reported on. In terms of Credit Administration, Mr. Naar acknowledged that the concept of unsecured loans had formed the basis upon which Credit Unions were built. He stressed however, the importance of the proper management of this portfolio through the assessment of the risks, and the adequacy of provisions against loan losses. In addition, he stated that the organization was ensuring that it is in compliance with new acts such as (SIPPA) and the Credit Reporting Act of 2010. In closing, Mr. Naar paused to thank the supporters and critics who have helped to make FHC strong, solid and secure. He stated that the Net Surplus achieved in the financial year was commendable given the unstable economic environment and assured the members that he is committed to the success of the organization. He then opened the floor for questions. Mr. Burke congratulated the CEO on the good performance of the organization. He also commended the CEO on FHC’s training and team development initiatives and its involvement within communities. He however pointed to the recurrent issue of long lines and unanswered telephone calls within branches. Mr. Naar acknowledged his comments and promised to ensure improvements in these areas. Mr. Brown queried if any breach had been identified under FACTA. The CEO advised that there were none. Mr. Brown also asked about the performance of the unsecured loans portfolio and queried whether these lines of credit were now available to members.

Mr. Naar explained that all unsecured loans were now available and the portfolio was performing creditably and that provision for loan losses was within the expected ratio of the provisions. Mr. Brown indicated that in terms of FHC’s stated intention to become more involved in agriculture, the Credit Union could invest in packaging and processing within the Cooperative movement as another alternative to enter the agricultural sector. He then asked the CEO to state the new bond for the Credit Union in light of the recent merger with St. Thomas Credit Union. Mr. Naar explained that the new bond would now include all the persons living and working in the parish of St. Thomas, along with their family members. Lastly, Mr. Brown suggested that two members, the best loan paying member and the best saving member, should be allowed to attend the Annual Convention and General meeting of the JCCUL. Mr. Naar fully endorsed this suggestion and promised to conduct further discussions with the Board and Management. Mr. Burke commended the Credit Union for establishing a Skill Bank Registry. He further suggested that training members was also essential and offered his services to do same. Mr. Naar requested additional information for consideration.

Rev. Major Kildaire openly lauded Mr. Naar for an excellent presentation and for his stalwart leadership of the Credit Union. He expressed sincere gratitude to Mr. Naar for his open door policy and genuine concern for his members, and concluded that he has been a recipient of such quality service. The CEO thanked Rev. Major Kildaire for his comments and expressed appreciation to his Management team as this was a collective effort. Mr. Earl White urged Mr. Naar to remain at the helm until the Bank of Jamaica grants the Credit Union the license to operate as a financial institution under the new regime. Mr. Naar assured the members that the Credit Union is already preparing itself for the transition and will be ready when this occurs. There being no other questions, the CEO asked for a motion to accept the Management’s Report. The motion was moved by Rev. Major Kildare, seconded by Mr. Earl White. The Chairman thanked Mr. Naar for his presentation and paused to welcome Mr. Kevin Forbes, Assistant Treasurer; Mrs. Tamara Francis Riley-Dunn, Board Director; Mrs. Beverly Williamson, Chairperson, Supervisory Committee; Mr. Dwight Gordon, Credit Committee; Mr. Noel Francis, Chairman, Credit Committee and Mrs. Althea Daley, Credit Committee. The Chairman then invited Mr. Robin Levy, Treasurer to present the Auditor and Treasurer’s Report.

10. Auditor and Treasurer’s Report The Treasurer directed the members’ attention to the Treasurer's Report on pages 66 to 67, and asked Mr. Chambers of Audit Firm KPMG, to read the report. Mr. Chambers stated that separate audits were done on the financial statements of First Heritage Co-operative Credit Union Limited and the consolidated financial statements of the Credit Union and its Subsidiary. He stated the Management’s responsibility to be that of preparing financial statements that give a true and fair picture in accordance with

International Financial Reporting Standards and the Co-operative Societies Act. He also outlined the Auditor’s responsibility as that of expressing an opinion on the financial statements based on the findings of the audit. Mr. Chambers stated that the audit was conducted in accordance with International Audit Standards and was performed in a manner that would give reasonable assurance that the financial statements were free from material misstatements. He stated that, in the Auditor’s opinion, the financial statements gave a true and fair view of the financial position of the Group and the Credit Union as at December 31, 2014, and is in accordance with International Financial Reporting Standards. In relation to additional requirements under the Co-operative Societies Act, Mr. Chambers stated that in KPMG’s opinion, proper accounting records were maintained and the financial statements were correct, duly vouched and in accordance with the provisions of the Co-operative Societies Act. The Treasurer thanked Mr. Chambers for the report given and proceeded to present the Treasurer’s report. The Treasurer reported Total Assets increasing to $8.83 billion at the end of the year which represented a $63.2 million increase over the course of 2014, ranking FHC as the second largest Credit Union in Jamaica. The Treasurer reported comprehensive Income of $114.9 million for the year and FHC Investments Limited achieving a surplus of $3.2 million before tax. In terms of Loans, the Treasurer reported a reduction caused by a contraction in the portfolio to boost liquidity and a buy-back of loans by the Jamaica Mortgage Bank. Mr. Levy also reported a reduction in Interest Income resulting from the reduction of loans and loan rates. He stated that Fee Income also reduced due to less loans as well as a reduction in fees charged to members. In terms of Operating Expenses, a reduction by $75.9 million or 7% was reported when compared to the previous year, due to careful management and containment of expenses. Past Due loans were reported to have risen to 10.4% of the total portfolio reflecting an increase from 9.3% in the previous year. He however assured the members that adequate provisions have been made to cover for potential loan loss. The Treasurer reported that Accumulated Surplus was $103.9 million but emphasized that, based on the Co-operative Societies Act regarding Statutory Reserves, Bad Debt Provision Adjustment, and the terms of the IFRS for the Retirement Reserve, the Credit Union has less to distribute than the previous year. He reassured the members however, that, unlike the previous year, the Credit Union is now more liquid, have made provisions for potential loan losses and have managed to successfully contain costs. In closing, the Treasurer reiterated his belief in the success of the organization, stating its excellent products, established policies, the broad membership base, and the capable management and team members as the critical success factors to propel the Credit Union to continued growth. The Treasurer ended his report and then invited questions from the floor. Mr. Rupert Brown queried whether there were expenses that had been incurred from the merger with St. Thomas Credit Union. Mr. Levy explained that even though a small deficit existed on the books of St. Thomas, he doubted that it would make a significant impact on the revenue of 2015.

Ms. Audrey Smith, Liaison Officer from the Accountant General’s Department queried the reason for the Jamaica Mortgage Bank’s buy-back of a portion of the Credit Union’s loan portfolio and asked the effect of this action on the Credit Union. Mr. Levy explained that this was part of the contractual arrangement with the Jamaica Mortgage Bank through which those loans were funded and that the members would not be negatively affected. Mr. Johnathan Brown made reference to a notation in the Annual Report of an investment property of the Credit Union and asked whether the organization could invest in property. Mr. Levy explained that generally, Credit Unions are discouraged from investing in property. He further clarified that the property was inherited from GSB with the merger, but is presently for sale. There being no more questions, the Treasurer asked for a motion to accept both the Treasurer's Report and the Financial Statements. A motion was moved by Ms. Juliet DaCosta and seconded by Mr. Carl Campbell. 11. Distribution of Surplus and Maximum Liability allowance

The Treasurer compared last year’s distributed surplus of $11.9 million to this year’s $8.5 million, revealing the reduction in the amount to be distributed among members. He stated that the honoraria to all volunteers have been reduced to $800,000 down from $2 million in 2013. He also stated that donations were negatively affected due to the reduced surplus. He then Mr. Brown pointed to an error in reporting where the report reflected inflated figures due to a typographical error. Mr. Levy acknowledged the error. There being no other questions pertaining to the distribution of surplus, a motion for the acceptance of the distribution of surplus was requested by the Treasurer. The motion was moved by Mr. Johnathan Brown and seconded by Ms. Marcia Wilson. In relation to the establishment of the maximum liability, the Treasurer recommended that it remain at 20 times the capital of the Credit Union. The motion for the acceptance of the maximum liability to remain at 20 times the capital of the Credit Union was moved by Mr. Anthony Simms and seconded by Mrs. Althea Daley. At this point Mr. Simms interjected with a request for a branch to be established in Westmoreland. He stated transportation challenges from Westmoreland to Montego Bay as reason for his request. Mr. Levy, while pointing out that the query was best suited for Any Other Business, accepted the request and promised that it would be considered in terms of feasibility. The Treasurer thanked the members for their participation and then handed over to the Chairman. The Chairman thanked Mr. Levy and asked Mrs. Beverly Williamson, Chairperson of the Supervisory Committee to present the report.

12. Supervisory Committee Report Mrs. Williamson started by explaining the functions of the Committee to be supervisory in nature, working closely with the Internal Audit Department. In the interest of time, she asked for a motion for the report to be accepted as read. Before the motion was carried, Mr. Brown queried the reason a replacement was not sought for the resigned member on the Committee, considering that the member requirement was five and the member had resigned early in the year. Mrs. Williamson stated that it was believed that the Committee could still ably perform its duties without an immediate replacement. She however, accepted Mr. Brown’s concern. Mr. Burke stated he was aware of past occurrences where members of the Supervisory Committee were not re-elected due to their investigations revealing matters of concern. He emphasized that it was the duty of the Committee to be impartial in carrying out its audits. Mrs. Williamson responded by saying that she was unaware of such occurrences and sought to assure the meeting that it was unlikely that the Nominating Committee would prevent an individual’s re-election because of this. Mr. Errol Thompson queried the notation on Anti Money Laundering. Mrs. Williamson assured him that the matters relating to this were minor and they have been resolved. A motion to accept the report as read was moved by Mr. Johnathan Brown and seconded by Mr. Carl Wittingham. The Chairman thanked Mrs. Williamson and asked Mr. Noel Francis, Chairman of the Credit Committee to present the report.

13. Credit Committee Report Mr. Francis explained that the functions of the Credit Committee were to review and approve members’ and team members’ loans. He stated that during the year, two members were added; Mrs. Althea Daley and Miss Faylene Foster, while two members retired; Mrs. Louella Maloney and Mrs. Marilyn Dunbar. Mr. Francis reported disbursements of $2.53 billion representing a decline over last year’s $2.9 billion. He stated also that the loan portfolio reduced from $6.7 billion in 2013 to $6.3 billion in 2014. Mr. Brown asked that for future purposes, the unsecured loan portfolio be broken down to indicate the percentage of productive and non-productive loans that comprised the total portfolio. He then asked for an indication of the present performance in each category. Mr. Francis noted that most unsecured loans were for consumption purposes. Mr. Burke queried whether it was the Credit Union's requirements that made it much easier for members to borrow for non-productive purposes. Mr. Franics indicated that, based on the CEO’s approach regarding the encouragement of loans for productive purposes, it was unlikely that this was the case. There being no other questions, a motion to accept the report as read was moved by Mr. Michael Edmondson and seconded by Ms. Marcia Fraser.

14. Nominating Committee Report The Chairman advised the meeting that, in light of the merger with St. Thomas Cooperative Credit Union, the decision was taken to approach Board representation from a strategic viewpoint. Mr. Hill stated that, based on the asset base and the deposit portfolio of FHC before and after the merger, the contributions from St. Thomas Credit Union represented approximately 10% of the combined asset portfolio and deposits. It was therefore agreed to have a representative from St. Thomas serve on the Board of Directors. He asked for the members to give their assent to this decision at the time of nomination. Mr. Hill then invited Mrs. Beverly Stewart, Chairperson of the Nominating Committee to present the report. Mrs. Stewart explained the functions of the Committee and introduced the other members of the Committee to the meeting as follows: Mr. Basil Naar, the Staff representative and Miss Ramsaran, the Member representative. The Chair then introduced the St. Thomas Credit Union Limited nominee to the Board, Mr. Michael James, Senior Superintendent of Police and an Executive Member of the Police Officer Association. He was asked to stand to be acknowledged. A motion to accept the report was moved by Mr. Ian Darby and seconded by Mr. Carl Campbell. Mrs. Stewart then invited Mrs. Karen Little from the Department of Cooperatives and Friendly Societies, to assist with the election of officers. 22

15. Election of Officers Mrs. Little asked whether there were nominations from the floor to serve on the Board of Directors, Supervisory Committee and the Credit Committee. There being none, the following represents the elected volunteers: Board of Directors to serve for two years: • Mr. Michael James • Mr. O'Neil Grant • Mr. Edmund Jones • Mr. Kevin Forbes • Mrs. Tamara Riley-Dunn Supervisory Committee to serve for one year: • Mrs. Beverly Williamson • Mrs. Asre Stewart-Blake • Mr. David Dobson • Mr. Denver Dyce • Mr. Lascelles Elis Credit Committee to serve for two years: • Mr. Quinton Masters • Mr. Richard Ranger

Mr. Burke interjected by offering himself to serve as a delegate from the floor to represent the Credit Union at the League’s AGM. Ms. Little asked for a motion to allow the Board to choose the delegates to the League. This motion was moved by Mr. Johnathan Brown and seconded by Mr. Michael Edmondson. The Chairman thanked Ms. Little for her assistance and paused to remind Mr. Burke to reconsider his stance, indicating that delegates to the League should effectively be persons who are familiar with the discussions within the boardroom. Mr. Burke stood resolute in his decision to serve. 16. Any other Business Mr. Simms queried the possibility of the Branch opening on Saturdays. The CEO was asked to respond. The CEO advised that based on Customer Surveys conducted, it was determined that very few members desired Saturday banking but rather earlier opening hours and extended closing hours on Fridays, which were currently being considered. He also mentioned that for the future, special ATM’s were being considered that had the capacity to facilitate deposits at various locations across the island, bringing the convenience of additional banking options to members. Mr. Brown asked the CEO about the Credit Union’s position on JCCUL’s product Connec. Mr. Naar advised the members that FHC is the leading Credit Union in terms of CONNEC accounts that has been opened and encouraged more members to utilize this novel mobile banking service offered by the League. Mr. Errol Thompson asked about credit card service and an ATM in Morant Bay. Mr. Naar explained that FHC is not able to issue dual currency credit cards presently, as it is not allowed by the Bank of Jamaica, to transact in foreign exchange. In terms of the ATM, Mr. Naar advised that recent investigations in St. Thomas indicated that the level of ATM usage in the area was very low. He explained that this, along with the attendant costs for installation and maintenance of the machine, would make this project prohibitive. He encouraged the St. Thomas members to consider debit card transactions as an alternative. Mr. Naar however, promised to revisit the proposal throughout the year. The Chairman thanked the CEO and invited 1st Vice Chairman, Leodis Douglas to give the vote of thanks.

17. Vote of Thanks Mrs. Leodis Douglas thanked the members for their participation and attendance. Special thanks were given to members from St. Thomas, Montego Bay and May Pen who made the effort to attend. She thanked the Management, team members and volunteers for their unswerving commitment and hard work. She gave special recognition to and requested a round of applause for outgoing Board Chairman, Mr. Orville Hill. She made special reference to his sterling contribution to the Credit Union and the Movement in general and thanked him for his willingness to serve. Lastly, she thanked the organizers and caterers of the event and wished everyone safe journey.

The Chairman thanked Mrs. Douglas and gave special acknowledgement to Miss. Janyce Robinson who was still in attendance and also thanked her for her years of service to the organization.

18. Termination The meeting terminated at 6:38 p.m.

________________________ Edmund Jones Secretary, Board of Directors

he financial year ending December 2015 was a fairly good year in spite of the many challenges experienced in the financial sector. Indicators in both the Micro and Macro economy showed favorable signs of improvement with the lowering of interest rates internationally and locally and the reduction in oil price globally as two key indicators. Generally the country did see small signs of growth in the economy. In addition, we experienced a single inflation rate 4.3% at the end of the year. Additionally, we closed the year with a Net International Reserve (NIR) of US$2,437.27M.

At the start of the year the weighted average selling rate for the USD was at JA$115.81:US$1 which depreciated to JA$120.42: US$1 by the end of the year. This translated to a 4.61% decline in the value of JMD relative to the USD in 2014. This compares to 7.78% decline in the value of the JMD relative to the USD in 2013. During the year, the Bank of Jamaica (BOJ) maintained its policy benchmark interest rate of 5.25%. As a result of the volatility in the foreign exchange rate, the Central bank initiated measures that tightened liquidity and resulted in an increase in the Treasury Bill rates. At the start of the year the 30 day Treasury Bill rate was 6.29%, the 90 day rate was 6.88%, while the 180 day rate was 6.99%. This showed an average decline of 10.89% in Treasury Bill rates since the start of the year 2015. This is in comparison to the rates as at December 2015 where 5.97%, 5.96% and 6.04% were the rates for the 30, 60 and 90-day Treasury Bills respectively. We anticipate that in light of the series of successful passes of the International Monetary Fund (IMF) Extended Facility Agreement test and as confidence returns to the Jamaican economy with small signs of growth and improvements in the country’s debt to Gross Domestic Products ratio, we should see more foreign investment and more spending in the economy. As the wage restriction of Public Sector Workers was lifted in 2015, it is our hope that our members will save more and also spend more than they did in previous years. Despite these challenges, our members, volunteers and team members remained faithful to our vision and mission. Notwithstanding the above, the year 2015 was a fairly good one considering the competitive environment in which we operated. One major challenge generally experienced by players in the financial sector included a competitive interest rate environment. Some players also experienced low loan disbursement levels and generally lower than expected growth in savings. Towards the latter part of the year, the Credit Union experienced a higher than expected loan loss provisioning due to the increase of the non-current loans in the Micro and Small Business Portfolio. This significantly impacted our surplus for 2015 as our budgeted loan loss provisioning figure was above budget by 65%.

We have and continue to execute a number of strategies to combat this situation and to safeguard this portfolio. During the year the Management of our Credit Union spent much time and effort in preparing for the pending Bank of Jamaica’s Regulations for Credit Unions. Though the Regulations did not materialize during the year, we continue to remain in this mode as the regulation of Credit Unions is imminent. As stated last year in our strategic thrust for 2015 and beyond, a number of growth strategies continued to be employed during the year. One key event was the Transfer of Engagement of the former St. Thomas Co-operative Credit Union Limited to First Heritage Co-operative Credit Union Limited. This Transfer of Engagement became effective on March 1, 2015. It was with great anticipation that we embraced the new addition to the FHC family and have been working with our members in St. Thomas to ensure that they enjoy all that FHC has to offer. The merger resulted in an expanded branch network to eleven branches as the former St. Thomas Co-operative Credit Union’s only location became a branch of FHC. With the addition of the St. Thomas Branch to the retail network our value-added services to our members increased, as the collaboration resulted in an expanded suite of products and services to include among others, the Direct to Client Agricultural Value Chain.

Our Subsidiary 28

FHC Investments Limited (FHCIL) a wholly owned Subsidiary of FHC now has Funds under Management of $2.93B. FHCIL is now six years in operations with a complement of ten team members. The company continues to provide success driven portfolio management services to its clients with professionalism and expertise. The approved Churches Co-operative Retirement Scheme is also managed by our Subsidiary. The performance of the Subsidiary for 2015 was fairly good and ended the year with a net profit after tax of $15.34M

Retirement Scheme Our Approved Retirement Scheme has been in existence since 2009. The year ending December 2015 showed a favorable Net Return of 14.68% to members. The Scheme now has a membership of 4,265 and currently provides a pension to 50 Pensioners. As at December 2015, the Funds under Management grew to $635.67M up from $493.95M at the beginning of the year. We are excited about the possibility of the future performance of the Scheme as more Jamaican who are preparing for their retirement will find our Scheme a most suitable choice.

FHC Foundation Our Foundation’s mission is to promote the development of Jamaica’s youth, in particular disadvantaged children and young people, through education, sport and community involvement, creating opportunities for growth towards the advancement of nation building

Throughout the year 2015, the FHC Foundation focused on youth development and education. At a time when the Jamaican youth population faces numerous challenges and the education sector needs all the support from the private sector, our mandate is to assist in reducing the “burden” on the nation’s purse and predictably enhance the lives of many. The FHC Foundation donated the sum of $2,383,000 towards GSAT Scholarships, Tertiary Scholarships and the Entrepreneurship Awards Programme as follows: • 10 New GSAT Scholarships worth $600,000 • Existing GSAT Scholarships worth 280,000 • 7 Renald Mason & Oswald Thorbourne Scholarships totalling $1,203,000 • Entrepreneurship Award of $300,000 We are proud of our heritage and will continue to embrace the culture of being a good corporate citizen.

The Financial Performance At the end of December 2015, the Credit Union Group’s Assets stood at $10.15B and we achieved a Net Surplus of $59.28M. As the business continued to align itself to improve the various key financial ratios to meet the pending Bank of Jamaica Regulations, several measures were implemented to include but were not limited to an aggressive drive to increase our deposit intake while offering our members value added loans and savings products, as well as instituting several cost cutting measures. Our strategies will continue to focus on our membership loyalty as we improve our customer service delivery, maintaining sound business principles, providing value added services, improving technology and efficiencies so that our members will enjoy great returns on their investment whilst the organization benefits from goodwill and brand recognition. Our key strategies over the next three years include our drive to improve our key performance ratios, ensure that our members’ needs can be facilitated from our continuously diversified suite of products driven by our Product Life Charter which facilitate the delivery of superior Member experiences, well as the use of technology to drive our service delivery and business output. We remain committed to our mission to be a world class financial institution as we strive to remain globally competitive in the 21st century. The Board of Directors expresses appreciation to all our members and key stakeholders and look forward to your continued support as we work together to make FHC and its Subsidiary the great financial institution we are becoming.

ATTENDANCE AT BOARD OF DIRECTORS MEETINGS

NAME

POSITION

SCHEDULED

ATTENDED

EXCUSED

Balvin Vanriel

Chairman

Leodis Douglas

1st Vice Chairman

O’Neil Grant

2nd Vice Chairman

Robin Levy

Treasurer

Kevin Forbes

Assistant Treasurer

Edmund Jones

Secretary

Beverly Stewart

Assistant Secretary

Tamara Riley-Dunn

Director

SSP Michael James

Director

he year ended with a Group Net Surplus of $59.28M. The year ended with members’ savings totaling $7.58B, a loan portfolio of $6.76B ($384.18M financed by external funding) and Group total assets of $10.15B.

It is noteworthy that despite the challenges experienced during the year, our performance showed signs of growth in some key areas including liquidity and Asset size. While we did not meet all our key strategic objectives we made significant progress, on which we will continue to build in 2016. During the year 2015 our strategic focus continued with the main emphasis on: 32

1) Improving the members experience and value; 2) Renewed energy in promoting entrepreneurship as an engine for growth in our economy, as we increased our Micro and Small Business loans thrust making them accessible to more Jamaicans the necessary funding to begin and/or expand their businesses. 3) Improving the productivity of the Credit Union while improving the key financial ratios. Throughout the year we continued our relentless efforts of encouraging our members to save as they plan for the future and continued to offer products and services to meet the needs of our members at every stage of life. Our merger with the St. Thomas Co-operative Credit Union Limited took effect on March 1, 2015 and we continue to work closely with our members in the parish to ensure FHC will remain their financial partners for all their needs.

FHC and its Subsidiary FHCIL as a group performed creditably for the period. Our commitment to generate continual benefits to our members and other stakeholders remained strong. Having had the experiences of a highly competitive and challenging environment in 2015 we again stand ready to provide sterling performance in 2016, as we increase our readiness for the regulations of Credit Unions by the Bank of Jamaica. Our key focus will remain as follows: 1. Continuously add value to our members 2. Improving Customer Service Delivery 3. Driving the performance of key financial ratios 4. Growing our Micro and Small Business Loans portfolio 5. Collaborations with other organizations for growth opportunities

STRATEGY AND CORPORATE AFFAIRS his division is accountable for the achievement of FHC’s new business, process reengineering, major projects and strategic support objectives in order that FHC Credit Union will achieve its Vision and Mission.

The Division has the responsibility for developing, monitoring and driving the execution of strategies of the organization. In addition, acts as a liaison for all legal matters. The division also gives general oversight to effective marketing & communications through the operations of the Credit Union’s Strategic Marketing portfolio. The Division has the challenging and vital responsibilities to ensure the alignment of all key strategic initiatives and indicators to the Mission and Vision of the Credit Union. Our annual Strategic Planning sessions played a key role in setting the stage for achieving our objectives. Our quarterly Strategic revision sessions held throughout the year also assisted with keeping the team on track as we measured and analyzed outcomes while making strategic decisions to support the strategic direction in the context of the changing environment. The challenging business environment in 2015 also provided us with many opportunities which resulted in several accomplishments which augured well for the Credit Union.

Strategy During the year several strategies were developed and executed to improve productivity across our operations. The Credit Union’s performance management system which is strategically linked to its mission, vision and core values also facilitated and provided motivation to team members as they were challenged and encouraged to consistently work towards greater effectiveness in achieving our goals and objectives. The Division’s key focus and achievements were as follows: 1) Improving financial ratios and overall strengthening of the Credit Union 2) Increased team members’ awareness and understanding of their specific goals and objectives through the Balance Scorecard (BSC) methodology 3) Enhanced specific products and services to meet the needs of our members at every stage of life 4) Increased corporate social responsibility initiatives 5) Implementing strategies which motivated the achievement of our financial objectives in the context of the challenging economic environment. 6) Form Strategic alliance to boost the productivity of the Credit Union and better serve our members. 7) Grow the Credit Union business through both organic and inorganic means 34

As stated earlier, on average, the Credit Union performed creditably in spite of the challenging economic environment. The greatest impact resulted from the less than expected performance of the Micro and Small Business Portfolio which resulted in above budgeted provisioning which negatively impacted surplus. Vital strategies have since been put in place to repair this position and therefore 2016 should show much more robust performance.

Project Management The cross functional project team met each week throughout the year to ensure the organization’s projects were effectively managed. The chief accomplishment of this area was executing most of the Credit Union’s initiatives and key deliverable in a project management environment. This was accomplished by projectizing all major deliverables, which included the developing and execution of Requests for Proposals (RFPs) for a number of projects which resulted in selection of soft-wares aimed at increasing efficiencies. Major Deliverables were: 1) Commenced implementation of the General Ledger Software for our subsidiary FHC Investments Limited to be implemented by second quarter of 2016 2) Implementation of several components of the IT software used for the Churches Cooperative Credit Union Retirement Scheme managed by our Subsidiary FHC Investments Limited. Though we had undergone the selection process of a new core banking platform we did not proceed with implementing our choice of system. Instead a new trajectory suggested

we look at a few more systems which we undertook to continue in 2015-2016 with the objective of implementing in 2017. Our key strategic focuses for 2016 are as follows: 1. Increase and add value to our members with focus on our delivering on our Value Proposition which will be launched in April 2016 2. Improving the Members’ experience 3. Growth of key performance ratios to include Capital ratios, Liquidity, and productivity. 4. Increases in loans and deposit performance 5. Collaborations with other organizations to stimulate growth. 6. Organic and inorganic growth We are encouraged by the opportunities of the future and stand ready to take our Credit Union to the world class organization we believe it is becoming for our members.

Marketing & Communications Our strategy and objective for 2015 focused on, strengthening our brand, building loyalty with our members and increasing deposits while offering products and services that meet the needs of our membership. The year 2015 was extremely competitive as several new players entered the financial market targeting unsecured consumer type loans. This resulted in heightened competitions, campaigns, promotions, and guerrilla marketing tactics all in an effort to sway potential customers to “buy in” to their offerings. As part of our strategy to assist our members in saving more we embarked on a savings promotion “SAVE WITH FHC & UNLOCK IT” in January 2015. This promotion ran for six months through to June 2015. The grand prize was a 2016 Audi A3 with a competitive interest rate on savings held for six months after the promotion. This promotion was very successful as we were able to not only meet our objectives but resulted in increased brand awareness and attracted a younger group of members. After the merger with St. Thomas Cooperative Credit Union in March 2015, we accepted the title sponsorship for the Heart of Praise Worship Fest in Morant Bay. This is an annual gospel event hosted in the parish with the objective of raising funds to support educational projects in St. Thomas and Portland. The pre -promotion of the event offered optimal exposure for the FHC brand throughout the parish and assisted us in getting to know our membership even better. A Town Hall meeting was also hosted to facilitate a better understanding of our membership in St. Thomas and helped us to understand their expectations as we shared and had meaningful discussions. Throughout the year additional product promotions were launched to include, Motor Vehicle, Home Equity and Debt Consolidation Loans. Our Facebook promotion entitled (COLLEGE ROLL CALL) targeted University students and the “HOLIDAY LOAN SALE” was launched later in December. We also partnered with Executive Motors Ltd to promote our Motor Vehicle Loan product which saw some positive traction.

In May, we partnered with the Child Development Agency (C.D.A) in an islandwide sensitization programme to educate the communities about the prevention of Child Abuse. Eight (8) seminars were hosted in parishes that were considered high risk and our participation included our role in sensitizing the groups about budgeting for the family as well as promoting entrepreneurial opportunities through our Micro & Small Business Loan Centres. We attained several awards at the annual CUNA MUTUAL AWARDS ceremony. Special awards for 2015 were as follows:• OUTSTANDING PRIVATE SECTOR PARTNERSHIP SUPPORT – COMMUNITY & ECONOMIC DEVELOPMENT • CITI/CMFA RUNNER UP OUTSTANDING MICRO ENTREPRENEUR AWARD – FHC MEMBER ODETTE OTTEY • OUTSTANDING SPONSOR – RJR CROSS COUNTRY INVASION Several channels such as social media, emails and mobile SMS and text messages were utilized to communicate with our members. In December our mobile enabled website was launched. We also targeted the youth, as we partnered with young Author Cameka Taylor who hosted a sensitization project called “HABITS MATTER SCHOOL TOUR” with the objective being youth empowerment through music, stories and financial guidance. Teams from FHC conducted presentations at several High Schools and tertiary institutions. 36

Our annual partnership with the Jamaica Reading Association (J.R.A) for National Reading Week was launched under the theme. “The Legacy of Literacy…. Passport to the World”. FHC team members volunteered to conduct “Read Aloud” sessions at twenty (20) primary schools island-wide. The Micro & Small Business product was promoted to individuals who own small and medium enterprises to access to loans and information on business planning; this was boosted via several partnerships which included the following: •

The FHC/RADA partnership for “GLOBAL ENTREPRENEURSHIP WEEK”; Micro Loan workshops were hosted in Newport Manchester and Caledonia Avenue, Mandeville.

•

Participation in The Jamaica Business Development Centre (J.B.D.C) Small Business Exposition in Kingston

•

Participation in the Annual “Men Who Cook” Exposition in Mandeville

•

FHC partnered with the Social Development Commission (SDC) to launch the Annual Small Business Exposition in St. William Grant Park, downtown.

• FHC/NHT partnership for an Information Fair in Kingston, Mandeville Town Centre and the Rudolph Elder Park in Morant Bay. • FHC/SDC workshops in Kingston, Morant Bay and Montego Bay • Money Management & Financial Expo – Golden Grove Sugar Company

FHC’s collaboration with the Jamaica Civil Service Association (JSCA) facilitated the sponsorship of the Civil Service Week of Activities. In addition, we sponsored the Civil Servant of the Year Award.

Corporate Social Responsibility Our Corporate Social Responsibility (CSR) initiatives are directly aligned to our mission and vision. Our commitment is to positively impact the communities in which we operate. This year was no different as every effort was made to ensure we satisfied as many demands in the communities in which we operate. These activities were executed by our team members across the Credit Union as follows: The Portmore Fire Station received much needed a facelift, whilst the kids at the Allman Town Infant School received a donation of beds, bed linen and educational supplies from the Kingston Gardens team. The Mandeville Team painted three classrooms at the Chevely Basic School, the Lawrence Tavern team collaborated with the Lawrence Tavern C.I.B and hosted a Christmas Treat for the kids in the community, whilst the Morant Bay team members issued a care package to a disabled member in the community The Eureka team donated a barrel of canned goodies and toiletries to Sophie’s Orphanage, the Wealth Development Unit hosted a Christmas Treat to the kids at the SOS village in St. Andree and the New Kingston team donated goodies to the Golden Age Home in Kingston. Our usual Labour Day projects were executed throughout all the regions as outlined below:-

Labour Day Projects • • • • •

Purchase of playground equipment - Rudolf Elder Park , Morant Bay Painting of the School’s Canteen – St. Aloysius Primary, Kingston Purchase of playground equipment – Cornwall Courts Housing Scheme Community Centre, Montego Bay Painting of the Westchester Belonie Basic School, St. Catherine Installation of bathroom and fixtures – Resource Basic School, Manchester

Other Activities In December, the Strategy & Corporate Affairs Division again hosted a Christmas Treat at the Poor Relief Centre, 65 Hanover Street, Kingston. Our team members offered their services to over 300 patrons issuing care packages and soup. The Portmore team painted the Portmore Fire Station. In addition, the kids at the Allman Town Infant School received a donation of beds, bed linen and educational supplies from the Kingston Gardens team;

The Mandeville Team painted three classrooms at the Chevely Basic School while, the Lawrence Tavern team collaborated with the Lawrence Tavern C.I.B to host a Christmas Treat for the children in the community. The Morant Bay team members issued a goodie package to a disabled member in the community, the Eureka team donated a barrel of canned goodies and toiletries to Sophie’s Orphanage. The Wealth Development Unit hosted a Christmas Treat to the kids at the SOS village whilst the New Kingston team donated goodies to the Golden Age Home in Kingston. Labour Day projects were executed throughout all the regions as team members shared the spirit of “genuine care” within the communities. Our strategic Marketing focus continue to ensure we are aware of the needs of our membership and are always finding dynamic ways to meet those needs as they are identified through research.

HUMAN RESOURCE DEVELOPMENT

n keeping with our Vision Statement of creating opportunities that will motivate team members and enhance the communities in which we operate, we continued our endeavours to provide for the welfare and development of our most valuable asset, our human resource.

1. Training Interventions Training in Risk Assessment Our Senior Branch Personnel, along with our Internal Audit Team attended a Risk Assessment Workshop. The workshop covered the different types of risk associated with financial institutions and the importance of conducting Risk Assessments. Certification – Basic First Aid & CPR Fifteen (15) of our team members gained certification in Basic First Aid and Cardiopulmonary Resuscitation (CPR). The training covered basic first aid/life saving skills such as bandage application, techniques for lifting victims, treating burns and administering cardiopulmonary resuscitation.

Credit Administration Work-shop Twenty-three (23) team members from across the Retail Network and the Credit Administration Department attend a workshop on Credit Administration, which covered loan under-writing, credit assessment techniques, and verification of collateral. The workshop also covered crossselling of loan products. Centre for Professional Development (CPD On-line) Web-based Training Progressive utilization of our web-based training facility (CPD On-line) was realized. This web based training option allowed our team members to gain access to over 300 Credit Union based courses. During the year, a total of 5,586 activities combined, inclusive of exams and courses were accessed by team members. This accounted for an estimated 17,658 training hours on CPD online. Time & Stress Management Workshop In an effort to assist team members in managing their time productively, a Time and Stress Management Workshop was conducted. Over fifty nine (59) participants from all areas of the Credit Union were in attendance. The session assisted team members to prioritize their duties to be executed in a timely manner which will enable them to be more organized, which will in turn result in the reduction of stress levels. 2. Reward & Recognition We embrace and encourage a performance based culture/environment and as such, we continue to reward our team members based on their performance. Our Team Member of the Year Awards is one such vehicle of acknowledgment. Twenty Two (22) team members were rewarded with tokens and cash incentives, at our Annual “Blast-Off” Meeting. In our efforts to continue rewarding and recognizing our team members, we extended our programme to include rewards and recognition to “Team Members of the Quarter” for branches and departments. 4. Team Members Welfare Mini- Wellness Fair A Mini-Wellness Fair was held during the year, under the theme “Promoting Preventative Health Care”. Among the several health screening/health checks conducted for team members were blood pressure checks, weight checks, body mass index checks, Diabetic and Metabolic Screening, Cholesterol and Lipid Profile, ECG and heart tests, Urine analysis, cancer screening. 5. Camaraderie and Social Activities Team Member Quiz Competition The Annual Team Member Quiz Competition was held during the year where departments and branches rivaled for the winning Cup and cash prize.

Sports Day Our Sports Day was held during the year. Four (4) houses competed in sporting/recreational activities for the winning place. There were several events held leading up to the actual sportsday, where each house participated in activities that awarded them points towards their final score. 6. Social Responsibility We continued hosting Internship Programmes, with H.E.A.R.T, Citizen Security & Justice Programme (CSJP) and facilitated work experience and summer internships for students from high schools and tertiary institutions. During the year we continued our Feeding Programme in partnership with St. Stephen’s United Church.

RETAIL, SALES & CUSTOMER SERVICE uring 2016 we focused on continuous improvement of our policies and procedures. Our goal is to simplify our operations in order to provide the most effective and rewarding experience for our members and other stakeholders when they do business with us. One such improvement is giving members the option of starting their loan application process online.

D 40

We kept in touch with our members via SMS text messaging, emails and letters. Our Member Care Centre handled over 144,000 in-bound telephone calls. An additional 2497 members registered for online banking during the year and over 157,000 online transactions were recorded. Retail Network The many economic challenges faced by our members contributed to some branches performing below expectation in loan disbursements and deposit intake. Notwithstanding the impact on our operations, most of the locations performed creditably and ended the year with commendable net surplus figures. Throughout the year we formed alliances with some companies, including ATL Automotive Ltd. and Executive Motors Ltd. from which members were given the opportunity to benefit

from lower interest rate and commitment fee on motor vehicle loans. We continued our partnership with ICWI and Sagicor Life Insurance Co. for the provision of affordable insurance premiums on Motor Vehicle insurance coverage and life insurance coverage on the lives of our mortgagors. The number of our service delivery channels was increased by one with the addition of the St. Thomas branch. Our Kingston Gardens branch was refurbished to better accommodate and serve our members. We also enhanced the aesthetics of the lower floor of the St. Thomas branch. These improvements were well received by our members. Wealth Development & Sales Unit Our Wealth Development and Sales Unit (WDU) demonstrated its resilience against the harsh economic and competitive climate in which we operated during 2015, and effectively carried out its mandate of taking the business to our members on their own time and in their own space. The team achieved over 70% of its aggressive deposit target and 139% of its loan target. The sales team participated in several promotional activities across the island and established new relationships with several public and private sector organizations, including churches, schools and non-financial co-operatives. One of our proudest moments was our partnership with the Jamaica Civil Service Association’s Civil Service Week activities, particularly our sponsorship of the Civil Servant of the Year award and our participation in the Civil Service Long Service Awards function. Our Liaison Officers contributed to the success of the Unit’s performance, particularly those who worked with our YOUTH savers in our School Savings Program. Their service was invaluable and we look forward to the strengthening of this very important collaboration. Customer Service Unit An independent Mystery Shopper Survey and a Member Satisfaction Survey were conducted during 2015. The results of these surveys showed that 85% of our members are pleased with our service delivery. Our goal is to increase this number to 98% in 2016. The surveys also identified areas of concern to our members to which we responded positively and made operational changes that serve to improve our members’ and other stakeholders’ experience when they do business with us. Our Member Loyalty Program was launched during the year and several of our members were rewarded for their demonstrated commitment to the Credit Union. Customer Appreciation Days were hosted in all our branches during Credit Union Week. Member Care Center We are extremely proud of our Member Care Centre Representatives and Telemarketers who delivered excellent service during 2015.The Telemarketers focused on getting members to re-activate their dormant and inactive accounts as well as providing them with information on our extensive suite of products and services.

Through these efforts many members renewed their interest in the Credit Union and resumed doing business with us. Our Member Care Representatives kept the lines of communication open to members and other stakeholders who utilized our telephone and email communication channels. The surveys conducted showed that our members were very satisfied with the service they received from the team members.

CREDIT ADMINISTRATION AND LOAN RISK ur top three loan categories for 2015 were: Mortgage loans and loans secured by Real Estate which stood at 26%, Motor Vehicle Loans 21% and the unsecured loans 16%. Our efforts in managing the risk of our loan portfolio continued throughout the year as a number of strategies were employed to reduce our exposure and protect the loan portfolio.

We were gravely affected by the economic conditions, as many of our members are Public Sector employees and their discretionary income was already overly committed, though they received some relief during the year as the Public sector wage freeze was lifted.

We continued to assist our members to meet their obligations with us, by restructuring current loans for better ability to repay, by extending their repayment periods and facilitating smaller repayments. We ended the year with a relatively high Non-Current portfolio. However, we are confident that with our continued efforts and strategies we will be able to see a marked improvement and reduction to a Non-Current Portfolio to a total loan portfolio of 5%.

OPERATIONS, INFORMATION TECHNOLOGY AND FACILITIES ur Operations, Information and Facilities Department provided a supporting role to the business units in ensuring that the business operated efficiently while providing good quality service.

We continued to review our policies and procedures to meet “best practice” standards, to minimize risks and to ensure efficiency in support of our frontline activities. The Compliance Unit conducted compliance monitoring on a consistent basis during the year and provided guidance in ensuring that our operations complied with regulatory requirements and our internal policies and procedures. Great focus was placed on our compliance to Regulatory Requirements particularly relating to the proceeds of Crime Act (POCA) and the Foreign Account Tax Compliance Act (FATCA). Where applicable, all required reports were filed as mandated under law. Risk assessment was done for various business units within the Credit Union and Risk Registers developed to aid the continuous monitoring and assessment of the identified risks. Facilities We continued to build on our strategic plan focusing on an organizational cultural of customer service and continuous improvement. Our goals are in alignment with the Business and Finance strategic plan. With technology changing hourly, upgrading Security Surveillance Systems in 2016 remains high priority across our network to better support legal action during cases of theft and property damages and general movements of staff and members at each location where we operate.

Information Technology Faced with increase threat in cyber space across the globe we commissioned a Penetration Test in 2015. The result indicated that we were on our way to providing a safe platform to support the operations of the company and protect our customers wealth. During the year we Implemented McAfee Antivirus across the branch Network to harden its security infrastructure and protect user and member data. Among the projects undertaken was an upgrade of all Windows XP Operating Systems running in the organization to Windows 7 Operating System as Microsoft had discontinued support and updates for Windows XP Operating Systems leaving it vulnerable to external security threats. Hardware Upgrade Significant sum was spent on hardware upgrade to meet increasing demands as there continued to be an increasing need for storage capacity and additional Storage Area Network (SAN) was purchased and implemented at an office location along with a new data circuit to be used exclusively for backup. This is now facilitating daily/weekly backups of FHCCU critical servers and forms part of the strategy for full business resumption in the event of a disaster.

The storage capacity of Document Management Server was upgraded in anticipation of a rapid growth in demand as the project to digitized members and other records continued at a hectic pace throughout the year. Additional scanners were also bought to facilitate the increase demand as the organization was reorganized to make use of the electronic document management system to facilitate improved customer service while managing long term growth in cost. Improvement to the telecommunication infrastructure saw us putting in an additional 24 phone lines, thereby increasing the available telephone access to our customers The Goldmine Application Software was implemented to facilitate communication with our valued members. Our members are now sent specific reminders and messages (niche marketing) and are also acknowledged with an E-card on their birthday. The branch network was prepared to facilitate Wireless Hotspot for our members not just to stay connected but to access FHCCU internet based services when they visit our branch networks across the Island. Multiple software were developed during the year as a part of our drive to automate our processes with a view to improve customer service and reduce cost. Among them were the Internal Mail System and the Credit Administration Past Due Status Reports.

FHC INVESTMENTS LTD HC Investments Limited is a wealth management firm, wholly owned by FHC Credit Union Limited. The firm is licensed by the Financial Services Commission and offer securities, and stock brokerage services. The aim is to provide world class service to our clients through our commitment to efficiency and excellent service.

Low economic growth, low inflation, low interest rates and tight fiscal management were the predominant features in the local economy over the year , while internationally there was unpredictability and volatility in the marketplace. Despite those conditions, the Company made a net profit after tax of $15.34M compared to $3.15M the previous year. Total Income for the year amounted to $77.58M which was $10.8M or 14.93% over the previous year. The main sources of income were from bond trading and fee income from the management of the pension funds and Investment portfolios. The Retirement Scheme managed and administered by the company was not unscathed by lacklustre growth in the local economy. The Funds under Management grew by 28.9% to approximately $635.67M with 4,265 contributors and 47 Pensioners. During 2016, it is anticipated that the local markets will experience high levels of liquidity stemming from the injection of approximately $95B from Government of Jamaica maturing Notes, Heneiken payout to Red Stripe minority shareholders and the reduction in the primary surplus targets by the International Monetary Fund. In addition to other variables these funds could drive interest rates lower, as well as place downward pressure on the local exchange rate. However it could also create the platform for growth in the local economy. Also the Jamaican stock market roared back to life over the past year with the main index increasing to a record of 97% return and the Junior Market giving a return of 67%. This performance was fueled by low interest rates, increased investor confidence after the country had successfully passed 10 IMF tests and increased profitability of the companies in the marketplace. All of these factors combined should create the conditions for continued buoyancy in the markets during 2016. Given the changing dynamics of the marketplace, our focus will be on sales, service and new product solutions that will meet the needs of our clientele. We have employed a team of Investment experts who are able to assist not just individuals, but also companies to

exploit the opportunities to create wealth and be successful. Also we will expand our foray into the capital markets to assist small and medium size companies to raise capital and provide working capital solutions. As we reflect, we would like to thank all our stakeholders – staff, clients and our parent company for their continued support over the last year. We remain relentless in our goal to maximize value to all our clients and stakeholders. We therefore encourage you to join us on this journey as we remain committed to take care of you and your Investments.

Overview It is a privilege to present the Treasurer’s Report to the Annual General Meeting of the First Heritage Co-operative Credit Union Limited (FHC) for the year ended December 31, 2015. The audited Financial Statements in this annual report are for the Group, which comprises the Credit Union and its wholly-owned subsidiary, FHC Investment Limited (FHCIL). The Financial Statements also include the results of the former St. Thomas Co-operative Credit Union at December 31, 2015, which was merged with FHC on March 1, 2015. Summary Financial Performance For the year ended December 31, 2015, FHC realized a Net Surplus of $40.2M as compared to prior year Net Surplus of $103.9M, while the FHC Group realized a Net Surplus of $59.28M, as compared to prior year’s Net Surplus of $103.31M. For the Group, this represented a 42.6% reduction in year-over-year surplus largely because of increased provisions for loan losses and a fall-off in interest income. Subsidiary FHCIL made a Net profit after Tax of $15.34M for 2015, as compared to $3.15M in 2014. The graph below shows the Credit Union’s Revenue and Net Surplus performances for 2013-2015 in more detail. 47

Total Revenue ($B)

The 2015 financial year was noted to be one of the most challenging in the recent history for the credit union movement and FHC was no exception, as many of our existing and prospective members experienced challenging economic conditions, reduced employment opportunities and a real reduction in their disposable incomes. Despite historically low loan rates, these conditions and a low rate of inflation encouraged many members to either postpone their purchase and credit decisions or pursue alternative borrowing options. Several struggled to service their existing loan obligations. FHC also experienced challenges in writing and administering micro-loans to such an extent that a complete restructuring of the Microloan Department became necessary during 2015. Further, in preparation for the pending Bank of Jamaica’s Regulations, FHC also decided to push to improve its liquidity position by curtailing the promotion of certain loan types. All these factors combined to both contain the growth of FHC’s loan portfolio and increase its past-due rates, the by-product of which was a reduction in the income we earned from loans and the need to make larger provisions for loan losses. At December 31, 2015, FHC’s total assets of $10.11B represented a $1.28B increase over 2014, which included the addition of $0.94B of assets from the merger with the former St. Thomas Co-operative Credit Union.

Members’ loans increased by a net $0.45B or 7.2%, from $6.31B (2014) to $6.76B (2015). Liquid Assets and Short term Investments grew from $1.03B in 2014 to $1.5B at the end of 2015, or by 47%, as our strategy to improve FHC’s liquidity position and achieving compliance with the Bank of Jamaica’s liquidity requirements succeeded in moving the Liquidity Ratio from 15.75% at 2014’s year end to 21.38% at December 31, 2015. The graph below shows the Credit Union’s Liquid Assets, Loan and Total Assets performance for 2014-2015 in more detail.

Members’ Deposits increased by $1.11B or 4.9% from $6.47B (2014) to $7.58B (2015), while Equity grew from $1.85B (2014) to $2.06B (2015), an 11.5% increase.

Economic Overview The year was another economically challenging one for our members and the Jamaican economy. Globally there were lingering effects of the global recession, including notable challenges in Europe but some signs of recovery in North and South America, while Brazil, Russia, India and China continued to show above-average GDP growth. While the Jamaican economy showed marginal improvement in GDP in 2015, socio-economic pressures mounted with the continued experience of large national debt, high unemployment, unequal income distribution and further weakening of the Jamaican dollar against hard currencies. The Jamaican Government reduced its fiscal deficit, contained its borrowing and further lowered interest rates in satisfying the structural benchmarks agreed with the International Monetary Fund (IMF) and passing its quarterly tests. The Jamaican dollar depreciated by 4.61% against the United States dollar in trading over the year to end 2015 at $120.42, as many of our savers looked towards hard currency investments. Inflation rate declined from 6.4% in 2014 to 4.3% for 2015, due largely to falling oil and commodity prices on the international markets. The 90-day benchmark Treasury bill rate started the year at 6.88%, and moved by 84 basis points downwards to 6.04% at year-end. FHC experienced reduced take up in loans, despite offering some of the lowest lending rates in recent history, as many members opted to reschedule or reduce their debt from savings instead. There was also significantly increased competition from other lenders in the market. While unemployment declined by 1.7 percentage points year-over-year to end the year at just under 14%, this rate still remained relatively high and financial service providers, like FHC, experienced generally increased delinquency and reduced savings intakes, as a result of the tight economic conditions.

Regulatory Environment The expectation for the Bank of Jamaica (BOJ) to assume the role of direct supervisor of Credit Unions in 2015 did not manifest itself and is now expected for 2016 or 2017, as this was overtaken by priority given to developments elsewhere in the legal and regulatory environment, The BOJ does continue to have oversight of our activities and reviews our financial reports and periodic audits. Our performance against International Credit Union Industry financial benchmark standards for safety and soundness (PEARLS) continues to be monitored by the Jamaica Co-operative Credit Union League Limited. Our performance is also compared to other prudential standards by the BOJ. FHC’s Institutional Capital to Total Asset ratio was 6.50% at December 31, 2015, compared to the minimum PEARLS Standard of 8%, and also compares with a 6% minimum requirement for the Bank of Jamaica. This reduction in our ratio stemmed from our decision to assist in strengthening the credit union movement by absorbing the impact of a $150M deficit from our merger with the former St. Thomas Co-operative Credit Union. It is expected that FHC will recover this sum over a 3-4 year span from the performance of the newly merged entity. Operational Results 50

Notwithstanding the many challenges faced by the Credit Union and its members, and the strategic decisions executed to ensure that regulatory requirements are met, FHC continued to undertake initiatives to improve its competitiveness, while addressing needed improvements in its customer service and internal controls. Key Results for the year 2015 were: • Interest Income of $1,211.5M (2015) increased by $60.6M or 5.3% from $1,150.9M (2014). The Credit Union remained competitive by offering attractive rates to our members, while applying deliberate strategic measures for improving our liquidity position. See graphical depiction of the Credit Union’s performance interest Income and Non-Interest Income for 2014-2015.

• Non-Interest Income of $164.4M (2015) increased marginally by $3.34M or 2.1% from $161.1M (2014). This increase is mainly attributed to the increase in Account maintenance fees and Cambio performance year over year. It should be noted also that, with the exception of Account Maintenance fees, there were no fee increases for 2015. • Interest Expense increased from $182.9M (2014) to $192.5M (2015), largely because of increased Member Deposits. The Credit Union continued to offer competitive saving rates to our members on savings products. • Operating Expenses increased by 3.7%, from $994.9M (2014) to $1,031.4M (2015), due mainly to marketing and promotion costs associated with promoting the FHC brand in the parish of St. Thomas and adjoining parishes due to the merger. It should be also noted that FHC exercised close monitoring and containment of costs for 2015 and as a result Operating Expenses were kept within budget.

• Past Due loan portfolio (30 days and over) as a percentage of our Total Loan portfolio was 13.64% (vs. 10.04% at December 31, 2014). This resulted from the inability of a large proportion of our members to service their loan obligations, largely due to unemployment and loss of disposable income. • Provision for Loan Losses increased from $30.3M in 2014 to $111.9M in 2015. Our provisioning for loan loss continued to be considered adequate to cover potential losses. • We continue to appeal to you our members to communicate with us as soon as problems are experienced in repaying your loans, either with us or elsewhere. We stand ready to assist in finding a beneficial solution in most cases. Insurance The Credit Union continued to maintain the Life Saving and Loan Protection coverages, for members’ benefit, with the credit union movement’s insurance company, CMFG Life (formally CUNA Mutual).

Conclusion For the year 2015, the Credit Union’s performance was largely mixed, with only a small increase in the loan portfolio as bolstered by the merger, reduced interest income from falling interest rates and non-performing loans and accordingly a significant increase in the expense of providing for loan losses. While FHC absorbed a significant deficit from the merger during the year, we had a positive, though reduced net income performance and our capital and liquidity positions both improved. There remain areas that require attention and improvement, notably those relating to loan administration, delinquency control and member service. We are however confident that the path we are on is the right one and that, with the continued dedication of all our members, Team Members and volunteers, we will overcome the challenges and accomplish the ambitious goals that we have set for the future. Acknowledgements I give thanks to God, my fellow co-operators on the board and you, my fellow members, for having given me the opportunity to again serve as your Treasurer. It has been an honour and a privilege to do so.

I thank and commend all the team members, including volunteers, managers and staff, who have consistently applied themselves to the Credit Union’s business. On behalf of the Board of Directors, I thank the Registrar of Co-operative Societies and the Jamaica Co-operative Credit Union League, for their expert assistance and guidance throughout the year. I also thank our Auditors, KPMG, for their professionalism and another timely completion of our audit. I doubly thank you, my fellow members, for the continued business, support and creative criticism that you have given to our Credit Union. God bless you all.

………………………. Robin Andrew Levy Treasurer

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Chairman’s Opening Remarks On behalf of the members of the Supervisory Committee, I would like to first of all, add my own words of welcome to all members of the First Heritage Co-operative Credit Union who have joined us here for this the fourth Annual General Meeting. We are pleased to have been associated with another year of operations, albeit a challenging one and wish to publicly commend the management and staff, as well as the cadre of volunteers who have worked tirelessly to achieve the several milestones previously reported.

The Committee The governance structure of Credit Unions provides for a Supervisory Committee whose members are elected from and by the wider membership at an Annual General Meeting.

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The Committee is charged with certain oversight functions which are discharged largely through the Internal Audit function. In addition, the Committee receives and investigates as necessary, complaints made by members as regards the proper functioning of the Credit Union. This latter function is executed by inviting members to submit comments/complaints through Suggestion Boxes strategically placed in the offices in which they transact business. At the Annual General Meeting on 2015 May 12, five (5) members were elected to the Supervisory Committee, as follows:

Mrs. Asre Stewart- Blake Mr. Lascelles Ellis Mr. Denva Dyce

Mrs. Beverley Williamson Mr. David Dobson

Mrs. Beverley Williamson was subsequently elected Chairman of the Committee and Mr. Lascelles Ellis, Secretary. During the period and up to the date of preparing this report, there have been ten (10) meetings of the Committee and in accordance with stated requirements; monthly reports were presented to the Board of Directors. Committee members also attended Joint Board of Directors meeting held quarterly during the review period and was represented at the strategic planning retreat of management held in 2015 August.

Attendance Record As at 2016 February 8, attendance by members to the Supervisory Committee meetings was as follows:

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NAMES Mrs. Asre Stewart Blake Mr. Lascelles Ellis Mr. David Dobson Mr. Denva Dyce Mrs. Beverley Williamson

ATTENDANCE 9 7 6 0 9

EXCUSED Resigned effective 2015 December 10 3 4 Did not attend meetings 1

Mrs. Karla Stephens-Hall, was appointed in accordance with the rules of the Credit Union to fill the vacancy created by the resignation of Mrs. Stewart-Blake, effective 2016 January 25. Mrs. Stephens-Hall who currently works in the field of Internal Audit is, by profession, a Chartered Accountant. She also holds certification as a Certified Public Accountant, Certified Internal Auditor and a Certified Risk Management Assurance Professional.

Matters Considered During The Period As with previous years, several areas of the Credit Union’s operations were examined over the period, some of which are routine monthly activities, some based on requests from management and others, executed in accordance with an audit plan developed at the start of the calendar year. The audit plan is based on circumstances then existing but in general is aimed at providing assurance as regards the management of key areas of risks, the operations of internal controls and governance processes. Approximately 40% of the audit plan was successfully completed during the review period as time had to be allotted to respond to unplanned reviews undertaken at the request of management, notably the review of the Micro and Small Business Loan Portfolio.

This particular area was extensively reviewed covering all locations from which this product is offered (Refer to Special Investigations below). More specifically, the Committee reports as follows: 1.

Bank Reconciliations

This very important activity was monitored on a monthly basis. All bank accounts were reported to have been prepared in a timely manner with most reconciling items being cleared in a satisfactory manner. There was however some deposits to the Credit Union’s bank account that remained unidentified beyond a month. However, by year end, management had made significant strides in identifying and posting these deposits. In addition, management has since established contact with the branch network of the banks making these deposits and implemented procedures that will allow for a more timely identification and thus postings of deposits from these banks. 2.

Volunteer and Staff Accounts

Volunteer and Staff accounts were also reviewed monthly with appropriate follow up to ensure that these accounts are maintained in accordance with established guidelines. Appropriate steps were taken to address all anomalies reported. 3.

Audits

During the review period, several audits were undertaken covering the following areas of operations: (1) Facilities Management; (2) Wealth Management, specifically a review of the use of Receipt Books; (3) Deceased Members Accounts; (4) Anti Money Laundering – POCA and (5) The Montego Bay Branch The audits were extensive and recommendations to management to address deviations identified were accepted and implemented, with appropriate follow up by the Supervisory Committee as well as at the level of the Board of Directors. 4.

Special Investigations

Several special investigations were undertaken at the request of management during the year, the review of the Micro and Small Business Loan Portfolio being the most significant. Indeed, the significance of this area was previously reported on by both the Chief Executive Officer and the Treasurer. Indications are that the state of affairs reported resulted from a combination of lack of adherence to proper controls as well as exploitation of the system, particularly by one officer of the Credit Union. Both these matters were addressed by management which agreed to review and revise, as appropriate, the procedures manual governing this product and where it was deemed necessary, to report the occurrences to the appropriate Authorities. This area and the matters pertaining to it remain open at the end of the reporting period and are being actively monitored at the level of the Board of Directors.

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Other Matters

As with last year, a review of the Credit Union’s compliance with the requirements of the AntiMoney Laundering Regulations was undertaken during the period. In general, the requirements of this Regulation were in place and being adhered to. Areas on noncompliance identified were subsequently addressed by management. Although the Suggestion Boxes were cleared monthly, no complaints or suggestions were received from the membership. This is an important way of ensuring continuous improvement in the products and services offered and we wish to remind the general membership of this method of communication and to assure you that this facility is continuously monitored. Supervisory Committee members have expressed the view that other media, such as an appropriate slot the First Heritage Credit Union website, should be developed for members to communicate directly with the Supervisory Committee. This is to be further explored with Management. Conclusion

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We wish to conclude by thanking the Selection Committee for their confidence in selecting us for consideration and to the members of the Credit Union for appointing us to serve in this important way. We would also like to express our gratitude to the management and staff, particularly those of the Internal Audit department, and the Board of Directors for facilitating the work of the Committee over the year.

______________________ Beverley Williamson Chairman

The Credit Committee is delighted to welcome all to the 4th Annual General Meeting of the First Heritage Co-operative Credit Union Limited. The Credit Union has seen its fair share of challenges in 2015. With the freezing of public sector salaries, coupled with credit reporting and credit scores; members are finding it even more exigent to access credit. With so many variables, the Credit Union continues to face challenges; but will nonetheless, strive to incessantly satisfy our members.

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Disbursement for the year totalled $2.452B which is a decline of 5.24 percentage point below that of the previous year of $2.532B. There was however, an increase in the total loan portfolio from $6.3B in 2014 to $6.8B in 2015; where cash secured loans, mortgage loans and motor vehicle loans were the main contributors. Mortgage loans dominated the portfolio at 26 percent whilst motor vehicle loans followed at 21 percent. Micro Finance Unit saw a 67.3 percentage point reduction in 2015; with disbursement of $147M when compared to figures in 2014 of $246M. For the period January to December 2015, a total of 48 meetings were held. All Five (5) previous serving members of the Committee remain committed to serve in 2015.

Members NOEL FRANCIS QUINTON MASTERS RICHARD RANGER ALTHEA DALEY FAYLENE FOSTER

Meetings held 48 48 48 48 48

Meetings attended 39 39 45 44 39

No. of times excused 9 9 3 4 9

The Committee therefore takes this opportunity to say many thanks to the highly trained and dedicated Management and Team Members of FHC and to our valued and committed members, we say a big THANK YOU.

________________________ Noel Francis Chairman

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In accordance with the provision of the Rules of First Heritage Co-operative Credit Union Limited in respect of Article XIV, Rule 59: a Nominating Committee was appointed which comprised of the following members: • Mrs. Tamara Riley-Dunn - Chair, Board Representative • Ms. Patricia Ramsaran - Member Representative • Mr. Basil Naar - Staff Representative The Committee met to consider all retiring volunteers from the Board of Directors, Supervisory and Credit Committees and advertised for Volunteers to fill the vacancies on the Board of Directors, Supervisory and Credit Committees. All candidates were assessed and recommendations made. The Nominating Committee now presents this report to the membership as outlined below: BOARD OF DIRECTORS The Directors retiring at this Annual General Meeting are:

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1. 2. 3. 4.

Mr. Balvin Vanriel Mrs. Leodis Douglas Mr. Robin Levy Mrs. Beverly Stewart

Director Beverly Stewart indicated that she would not be available to serve for another term. We thank Director Stewart for her contribution to the Credit Union. The Committee nominates the following persons who have all indicated their willingness to serve: Retiring Mr. Balvin Vanriel Mrs. Leodis Douglas Mr. Robin Levy Mrs. Beverly Stewart

Recommended Mr. Balvin Vanriel Mrs. Leodis Douglas Mr. Robin Levy Mr. Noel Francis

Term (years) 2 2 2 2

SUPERVISORY COMMITTEE The members of the Supervisory Committee all of whom retire at this Annual General Meeting are: 1. Mrs. Beverley Williamson 2. Mr. Lascelles Ellis 3. Mr. David Dobson 4. Mr. Denva Dyce 5. Mrs. Karla Stephens-Hall

Mr. David Dobson and Mr. Denva Dyce will not be returning to the Committee. Note should be made of the appointment of Mrs. Karla Stephens-Hall in January 2016, in accordance with Article XIII, Rule 44c, due to the vacancy created by the resignation of Mrs. Asre StewartBlake. We thank Mrs. Stewart-Blake for her service to the Credit Union. The Committee nominates the following persons who have all indicated their willingness to serve: Retiring Mrs. Beverley Williamson Mr. Lascelles Ellis Mrs. Karla Stephens-Hall Mr. Denva Dyce Mr. David Dobson

Recommended Mrs. Beverley Williamson Mr. Lascelles Ellis Mrs. Karla Stephens-Hall Mrs. Camelle Ricketts-Moore Mr. Luke McIntosh

Term (years) 1 1 1 1 1

CREDIT COMMITTEE The members of the Credit Committee retiring at this Annual General Meeting are: 1. 2. 3.

Mr. Noel Francis Mrs. Althea Daley Ms. Faylene Foster

The Committee nominates the following persons who have all indicated their willingness to serve: Retiring Mrs. Althea Daley Mr. Noel Francis Ms. Faylene Foster

Recommended Mrs. Althea Daley Mr. Pete Nesbitt Ms. Angeline Mae Carr

Term (years) 2 2 2

Profiles of Candidates 1.

Board of Directors

Mr. Balvin Vanriel, FCCA Mr. Vanriel is currently an Audit Manager with the auditing firm BDO Chartered Accountants. He is a qualified Accountant, a Fellow with the Institute of Chartered Accounts of Jamaica and a member of The Association of Chartered Certified Accountants (ACCA). Mr. Vanriel is also a Registered Public Accountant. He serves as an Associate Minister in his denomination and is Chairman of the Finance Committee. He is currently the Chairman of Board of Directors of FHCCUL and FHC Investments Limited. He is married with two children. Mrs. Leodis Douglas, MBA Mrs. Leodis Douglas is currently the Human Resource Director and Lecturer at GC Foster College of Physical Education and Sport. In this capacity, Mrs. Douglas is charged with

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responsibility to guide and manage the overall provision of Human Resources services, policies and programs for the college. Mrs. Douglas is the holder of a Masters of Business Administration from Florida International University, a B.Sc. in Human Resources Management, graduating summa cum laude and a Diploma in Secondary Education with Honours. She presently serves as a volunteer as 1st Vice Chairman on the Board of Directors of FHCCUL and is the Chairman of the Retirement Scheme Board of Trustees. Mr. Robin Levy, MBA Mr. Robin Levy is currently employed as the Deputy General Manager for the Jamaica Stock Exchange since 2005. He is an innovative business manager, specializing in financial services, risk management and project management. He has over 25 years of experience in management consulting, financial analysis and business development. Prior to joining the Jamaica Stock Exchange, he served as Manager – Consulting Services at the Jamaica Cooperative Credit Union League Limited. He is a Certified Fraud Examiner and holds a Masters of Business Administration Degree in Finance from the Marist Business School, Poughkeepsie, New York. He currently serves as a volunteer in the capacity as Treasurer on the Board of Directors at FHCCUL. 144

Mr. Noel Francis, O.D. Mr. Noel Francis is an Associate of the Royal Institution of Chartered Surveyors, a Commissioned Land Surveyor and a Class 1 Hydrographer. His work experience includes the management of the Survey Department as Deputy Director of Surveys, Consultant to the Commonwealth Secretariat and the United Nations & he currently Lectures at the University of Technology. He currently owns and operates his own businesses Franmark Company Limited, which is a Food Distribution business and Prime Dairy which is a Money Remittance Business. Educated at the University of the West Indies, University College London, University of Toronto and Nova University Mr. Francis’ qualifications include a Bachelor of Sciences Degree (BSc.) and a Masters of Business Administration (MBA). Mr. Francis currently serves on the Board of the Jamaica Copyright Agency as Treasurer and as a volunteer in the capacity of Chairman of the Credit Committee of FHCCUL. Mr. Francis has been honored by the Jamaican Government with an Order of Distinction. 2.

Supervisory Committee

Mrs. Beverley Williamson, MBA She is currently the Senior Vice President, Business Management & Special Projects at the Port Authority of Jamaica (PAJ) Kingston a position she has held since 1998. Prior to that, she served as the Senior Vice President, Finance & Information Services. She has also worked at the National Ex-Im Bank of Jamaica and Peat Marwick & Partners (now KPMG Peat Marwick). She holds an Executive MBA from the Florida International University,

MSC in Accounting and a BSC in Management Studies from the University of the West Indies. Mrs. Williamson currently serves as a volunteer in the capacity of Chairman of the Supervisory Committee at FHCCUL. Mr. Lascelles Ellis, MSc. Mr. Lascelles Ellis is a results-oriented, hands-on professional with broad experience in all aspects of accounting and financial management. He is currently the Principal Finance Officer in the Government of Jamaica Court Management Services, a position he has held since 2010. His professional knowledge spans some forty year (40) with experiences in both Public and Private Sectors. He holds a Master of Science Degree in Accounting from the University of the West Indies. Mr. Ellis currently serves as a volunteer in the position as Secretary for the Supervisory Committee at FHCCUL. Mrs. Karla Stephens-Hall, CPA, CA, CIA Mrs. Karla Stephens-Hall’s career has exposed her to senior positions within companies such as Cable & Wireless Communications Group, PricewaterhouseCoopers and Mossel Jamaica Ltd (Digicel). Mrs. Stephens-Hall currently holds the position of Regional Senior Business Internal Auditor (HOD) within the Cable & Wireless Communications Group where she is responsible for the planning and completion of internal audits for all departments and Companies in the Caribbean. Her work experiences have seen her holding positions such as Business Assurance Manager, Operations Manager, General & Project Accountant and Regional Finance Manager. Mrs. Stephens-Hall is an accomplished Internal Auditor and financial professional. She holds a Bachelor of Sciences Degree (with Honours) in Accounting and Economics. Since completing her Degree she has accomplished designations as a Certified Public Accountant (CPA) - 10 years, a Chartered Accountant (CA), Certified Internal Accountant (CIA) and Certified Risk Management Association Professional (CRMA). Currently, she holds membership with the New Hampshire State Board of Accountancy (Licensed), the Institute of Chartered Accountants of Jamaica (ICAJ) & the Institute of Internal Auditors (IIA). Mrs. Stephens-Hall currently serves as a volunteer on the Supervisory Committee of FHCCUL. Mrs. Camelle Ricketts-Moore, FCCA, MBA, CIA, CISA Mrs. Camelle Ricketts-Moore is an Internal Audit Manager with 17 years working experience in the field of Accounting, Internal Auditing and General Business Operations developed primarily from the Food Manufacturing, Retail and Distribution Industry and the Education Sector. Her achievements include the drafting of an Internal Audit Charter, instituting a framework to guide the progression of the Internal Audit department, as well as developing and instituting a Risk Based Audit Process and an Operations Manual. She possess a generally good understanding of Corporate Governance and Enterprise Risk Management (ERM). Mrs. Ricketts-Moore holds a Master in Business Administration and is a Certified Information System Auditor, Internal Auditor (CISA) and Chartered Accountant. She is a member of the Association of Chartered Certified Accountants (ACCA) since 1999, Information Systems Audit and Control Association (ISACA) since 2004 and Institute of Internal Auditors (IIA) since 2006.

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Mr. Luke McIntosh, J.P. Mr. Luke Mclntosh has a diverse 26-year career spanning the public and private sectors, and has proven to be a meticulous financial administrator, adaptive strategist, a skilled motivator and an effective leader. He is currently the Principal Finance Officer at the Ministry of National Security, and has worked as the Principal Finance Officer at the Ministry of Justice, Financial Controller of a major statutory body and Director of Finance at the island's largest public health care group. He holds a Post Graduate Degree from the University of Technology; an Under Graduate Degree from the University of the West Indies; a Teaching Diploma from the Mico Teachers' College; a Diploma in Project Management and several specialized certificates in the areas of Leadership & Change Management, Government Accounting, Corporate and Strategic Planning, Public Sector Procurement, Human Resource Development for Capacity Building and Policy Development. Mr. Mclntosh, a Justice of the Peace, is an Executive Member/Treasurer of Father's Inc. and a Gender Activist with the Women's Media Watch. A sporting enthusiast, he has been a member of several successful Inter-collegiate Cricket and business house Table Tennis teams. 3.

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Credit Committee

Mrs. Althea Daley Mrs. Daley currently serves as a Consultant with the Petroleum Industry Employees Cooperative Credit Union Limited since December 2013. She is an innovative financial service manager with over 20 years’ experience and has successfully managed the merger process of three (3) Credit Unions. Mrs. Daley has served the Credit Union movement extensively as she was also a consultant with the Jamaica Co-operative Credit Union League Limited, was Deputy General Manager for the Montego Co-operative Union Limited and served in the capacity of Manager for both Shell Employees Co-operative Credit Union Limited and Grace Co-operative Credit Union Limited. She holds a Postgraduate Diploma in Financial Services Management from the Jamaica Stock Exchange E-Campus and a Bachelor of Science in Management Studies from the University of the West Indies. She has been serving the Credit Union as a volunteers on the Credit Committee since 2014. Mr. Pete Nesbitt Mr. Nesbitt commenced working at National Housing Trust (NHT) in 1993 and is currently a Project Manager. He has worked in various capacities throughout the organization, namely; the Loan Administration, Debt Management, Customer Service and Project Management Departments. Currently completing his MA in Transformational Leadership at the International University of the Caribbean (completing Research Paper), he holds a BA in Management from the B & B University College. He also holds certifications in Supervisory Management and Customer Service and is a certified member of the Jamaica Customer Service Association (JCSA) and has conducted presentations within and external to the NHT.

Ms. Angeline Mae Carr, CA, FCCA Ms. Angeline Mae Carr has twenty-nine (29) years of experience both in private and public sector entities, and in different industries, in the fields of Accounting, Banking, Internal Auditing, Compliance and Company Secretarial roles. She is currently the Chief Accountant at the Courtleigh & Knutsford Court Hotels, a position which she has held since 2014. Ms. Carr is a certified Accountant and is a member of the Association of Chartered Certified Accountants (ACCA) since 2010.

Tamara Riley-Dunn Chair, Nominating Committee Signed By:

………………………………………………………….. Tamara Riley-Dunn Director

……………………………………………………………. Patricia Ramsaran Member Representative

……………………………………………………………. Basil Naar Staff Representative

8/4/2016 ………………………… Date

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JAMAICA CO-OPERATIVE CREDIT UNION LEAGUE LTD. 2015 CONVENTION & 74th ANNUAL GENERAL MEETING Held MAY 28-31, 2015 HIGHLIGHTS _________________________________________________________ The Jamaica Co-operative Credit Union League’s 74th Annual General Meeting was held from May 28-31, 2015 at the Hilton Rose Hall Resort & Spa in Montego Bay. It was held under the theme: “Local Service...Global Good.” Approximately one hundred and fifty (150) delegates and observers attended the week-end convention. The schedule of activities included a trade show.

The following activities took place on Thursday, May 28 •

The Credit Union Managers’ Association annual general meeting.

•

A simulation exercise called “Reality check: A day in the life of your credit union members” in which participants engaged in a simulation of the challenges faced by ordinary members in their attempts to access financing. Mr. March Lynch, a field coach with the National Credit Union Foundation of the USA was the facilitator. It was an overwhelming success as it showed persons the do’s and don’ts of managing their personal finances, and how credit unions can assist their members in their time of need. A plenary session was the next item on the weekend programme. During this sessions a number of topics were discussed. These included an update on the Bank of Jamaica Regulations.

•

The Conference was officially opened on that same afternoon with delivery from keynote speaker, Ms. Cynthia Campbell from the Filene Research Institute, Madison Wisconsin, USA. She spoke on the topic “Channel Delivery for tomorrow and its implications for GenY”

FRIDAY May 29: The highlight of the convention was the Movement’s Strategic Planning session for the period 2016-2020. It was a day of learning, strategic thinking and planning to guide the Jamaican Movement through to 2020. Approximately 100 leaders from 33 credit unions assembled to assess their progress over the previous five years and to establish strategic objectives over the next 5 years that would reinforce the vision of the Jamaican credit union system, which is to be the primary financial institutions for their members.

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Presidents, Treasurers and General Managers were the categories of participants selected to attend the session. Altogether four presenters from the Cornerstone Credit Union League izn Texas, and other Credit Union affiliated organisations in the United States, facilitated the session. WORKSHOPS Four workshops were held simultaneously along with the strategic planning session. They were: • The Art of War...Cyber War • Enhancing Customer Service and competitiveness in Credit Unions • Financial Education - Empowering the next generation • Implementing Flexi Work Day in Credit Unions The annual awards dinner ended the day. A number of Credit Unions received awards in the annual competition in the categories of Mega Credit Union, Large Credit Union, Medium-sized and Small Credit Union. Guest speaker at the awards banquet was Minister of Finance and Planning, Dr. Peter Phillips. Saturday, May 30- ANNUAL GENERAL MEETING 150

The Annual General Meeting was chaired by President Derrick Tulloch who did a multi-media presentation summarising the Board report. All aspects of JCCUL’s operations were presented and examined. Treasurer Mrs. Andrea Messam presented the Treasurer’s report and fielded questions. Rule Amendments A number of rule changes were proposed for discussion at the 2015 annual general meeting. Here are the Rule numbers and the rationale for the changes. •

Rationale for rule changes

(1) The interpretations section was amended to: (a) Tighten the definition of “financial distress” (b) Define “Prior Undivided Earnings Deficit Guarantee” (c) Define “Net Institutional Capital” These changes were proposed to the rules to provide for the approval of Bylaws relating to rule 77. (2) Rule 37 was amended: (a) To provide for the ability of the Board to be able to change the peer group asset categories as Credit Unions grow. (b) To adequately provide for the tenure of a Director who was elected by a particular peer group but whose Credit union has grown and moved to another peer group. Rule 37(3) and (4) were amended and a new rule 37(7) was added.

(3) Rule 41(5) was amended to provide for the verification that a Director is in good standing not just with his Credit Union but other financial institutions as well. (4) Rule 71 was amended to include the net value of the Stabilization Fund i.e. net any liabilities or contingent liabilities RESOLUTIONS Condolence and congratulatory resolutions were passed on behalf of credit unions for volunteers who had passed on during the year. They include : The late Desmond Duval of NWC Credit Union and Keith Lewis of D&G Credit Union while congratulatory resolutions were passed for Jamaica Police Credit Union that was celebrating its 60th year and Hanover Credit Union that was boasting 40 years of existence. Sunday, May 31: ECUMENICAL SERVICE The Ecumenical service took the form of Praise & Worship. The Closing plenary session was presented by Mrs. Marcia Woon-Choy, an Action COACH who spoke on “Leadership: Alignment and Execution”. New JCCUL Board The following Directors were elected to serve on the League Board for the ensuing year: • • • • • • • • • • • • • • •

Derrick Tulloch - President Carol Anglin -1st Vice President Winston Fletcher - 2nd Vice President Andrea Messam - Treasurer Jerry Hamilton - Assistant Treasurer Rodcliffe Robertson – Secretary Dr. Dorothy Raymond - Assistant Secretary Martin Blackwood Paul Gardner Norris Gilbert O’Neil Grant Clide Nesbeth Anthony Young Lambert Johnson Glenroy Williams

The Supervisory Committee Members who were elected to serve for one year are: Ms. Nicola Reid Mr. Paul Nathan Mr. Robert Ramsay Mr. Sefton Cummings Mrs. Tamara Baugh-Brissett

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___________________ Basil Naar Delegate

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____________________ Leodis Douglas Delegate

Isakalu Duffus Manager-Information Systems Kadian Dyke Assistant Manager – Micro & Small Business Loans Unit Gavin Francis Manager – Risk and Compliance Alleesa Matherson Manager - Centralized Loans Unit Garfield Pearson Manager - Accounting & Treasury Rosemarie Samuels Manager - Human Resource Development 154

Claud Sawyers Manager - Sales & Services

Branches

Address

Branch Managers

Kingston & St. Andrew

8-10 Eureka Road Kingston 5

Melissa Miller - Benjamin

Lawrence Tavern Lawrence Tavern P.O. St. Andrew 20 Dominica Drive Kingston 5

Rayon Wright

10 East Avenue Kingston 4

Eugene Williams

St. Catherine

Lot 57 West Trade Way Portmore Town Centre

Trudian Stewart

Unit 13 6 March Pen Road Oasis Shopping Centre Spanish Town

Mendel Thompson

Shops 8 & 9 East Side Street Old Harbour Clarendon

Shops 5 & 6 Bargain Village Plaza May Pen

Norman Williams

Manchester

2 Perth Road Mandeville

Andre Sampson

St. James

21 Union Street Montego Bay

Marcia Bailey

FHC Investments Limited Kingston

Suite 27 Winchester Business Centre 15 Hope Road Kingston 10

Doreen Holness

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1. Order Of Business An agenda shall be prepared by the Chairman and Secretary, and all items. Thereon shall take precedence over all other business. Any member desirous of introducing business for the consideration of the meeting may do so after the business on the agenda has completed, or may give notice of motion to be discussed at a further meeting.

2. Suspension Of Standing Order In the event of any matter of urgency, however, the Chairman may accept a suspension of the Standing Orders. The member moving such suspension must clearly state the nature and urgency of his business, the numbers of the standing orders affected, and the length of time he desires such suspension to last. At the option of the meeting, a further extension may be allowed, but no suspension shall take place except by majority vote of the members present.

3. Minutes 156

No motion or discussion shall be allowed on the Minutes except in regard to their accuracy. After the confirmation of the Minutes, they shall be signed by the Chairman, and the members shall than be at liberty to ask any questions in regard to matters arising out of them. Such questions shall be allowed for purposes of information only, and no debate on the policy outlined in the Minutes shall take place. 4. All persons desiring the floor shall rise and address themselves to the chair. They shall state their name and the Credit Union which they represent, if recognized by the chair, they shall have the privilege of the floor and all the rights thereof. 5. All speakers are to make use of the Desk and Floor Microphones when addressing the Meeting in order that it be recorded and made a permanent record in the Meeting Proceedings. 6. Should two or more persons rise at the same time, the chair shall decide, without debate, who is entitled to the floor.

7. Speeches No member shall be allowed to speak more than once upon on any motion before the meeting, unless in Committee, or on a point of order, or explanation, except the mover of the Original Motion. But on an amendment being moved, any member even though he has spoken on a Original Motion, may speak again on the amendment. No member shall speak for more than five minutes at a time. Members wishing to raise points of order or explanation must first obtain the permission of the Chairman and must raise immediately the alleged breach has occurred.

Any member may formally second any motion or amendment and reserve his speech until a later period in the debate. 8. No person shall interrupt another who is speaking except on a point of order, a parliamentary inquiry, or a point of information. 9. If it should come to pass that a speaker is called to order while speaking, the speaker should take his seat until the question of order is determined.

10. Chairman's Ruling The ruling of the Chairman on any question under the Standing Orders, or on points of order or explanation, shall be final, unless challenged by not less than four members, and unless two-thirds of the members present vote to the contrary.

11. Interruption If any member interrupts another while addressing the meeting, or uses abusive or profane language or causes disturbance at any of the meetings, and refuses to obey the Chairman when called to order, he shall be named by the Chairman. He shall thereupon be expelled from the room and shall not be allowed to enter again until an apology satisfactory to the meeting be given. 12. A question shall not be subject to debate until it has been duly moved and seconded and is stated from the chair.

13. Motions And Amendments The first proposition on any particular subject shall be known as the Original Motion, and all succeeding propositions on that subject shall be called amendments. Every motion or amendment must be moved and seconded by members actually present at the meeting before they can be discussed, and, wherever possible, should be set forth in writing. It is permissible for a member to make his speech first and conclude with a motion. When an amendment is moved to an Original Motion, no further amendment shall be discussed until the first amendment is disposed of (Notice of any further amendment must be given before the first amendment is put to the vote).

14. Substantive Motions If an amendment be carried, it displaces the Original Motion and itself becomes the substantive motion, whereupon any further amendment relating to any portion of the substantive motion may be moved, provided it is consistent with the business and has not been covered by an amendment or motion which has been previously rejected. After the vote on each succeeding amendment has been taken, the surviving proposition shall be put to the vote as the main question, and if carried shall then become a resolution of the meeting.

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15. Right Of Reply The mover of the Original Motion shall if no amendment be moved, have the right of reply at the close of the debate upon such motion. When an amendment is moved he shall be entitled to speak thereon in accordance with Standing Order No. 8 and at the close of the debate on such amendment shall reply to the discussion, but shall introduce no new matter. The question shall then be put to the vote immediately, and under no circumstances shall any further discussion be allowed once the question has been put from the Chair. The mover of an amendment shall not be entitled to reply.

16. Withdrawals Or Additions No motion or amendment which has been accepted by the Chair shall be withdrawn without the majority vote of the meeting. Neither shall any addendum or rider be added to a motion which has once been accepted by the Chair without majority vote. Should any member dissent, the addendum must be proposed and seconded, and treated as an ordinary amendment.

17. Closing Debate

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The motions for the previous question, next business, or the closure, may be moved and seconded only by members who have not previously spoken at any time during the debate. No speeches shall be allowed on such motions. In the event of the closure being carried, the mover of the Original Motion shall have the right to reply in accordance with Standing Order No.16 before the question is put. Should any one of the motions mentioned in this Standing Order be defeated, thirty minutes shall elapse before it can be accepted again by the Chairman, unless he is of the opinion that the circumstances have materially altered in the meantime.

18. Adjournment Any member who has not already spoken during the debate may move the adjournment of the question under discussion, or of the meeting, but must confine his remarks to that question and must not discuss any other matter. The mover of the motion upon which the adjournment has been moved, shall be allowed the right to reply on the question of the adjournment, but such reply shall not prejudice his right of reply on his own motion. In the event of such motion being lost, it shall not be moved again, except in accordance with Standing Order 18. 19. Any member may call for a division of the House (that is, for a roll call vote) when there appears to be a reasonable doubt as to the accuracy of the vote as announced by the Chair. 20. A motion to lay on the table shall be put without debate. 21. Whispering, loud talking, or other disturbances calculated to disturb anyone while speaking will not be tolerated

Delfreda Allen Louise Allen Valda Baker Jeoffrey Banton Carmen Barnes Esther Barrett Relva Bigby Everton Blake Rachael Blake Paulette Bookall Archibald Brown David Brown Noel Brown Fitzroy Buckley Norman Burke Lunette Burnett Kru-Bete Bygrave Winnifred Case Sandy Chambers Pearl Choy Clement Clarke Witlif Clarke Ritenella Clarke-Cohen Leila Coffiey Mrytle Cooke Millicent Daley Burley Darby Ajanique Dennis Alison Dennison-Martin Adasie Diaz Anthony Dixon Albertha Doran Hubert Dyer Horaldo Edman Damion Ellis Jacqueline Forrester Jenelee Francis Collin Gardner Solomon Goode Pauline Grace

Lloyd Sonia Neville Patrice Monica Andrea Monica Carlton Elceta Uevillah Edith Wendy Lola Elaine Ann-Marie Lurline Iris Leonard Juline Cyvel Fitzalbert Shirley Dwight Jacqueline Alwin Gloria Francisco Carlton Marcia Beverly Hilma Yvonne Alvano Earl Edward Mahetabell Christine Shevon Yvonne Linette Gloria Norma Carlene Sharon

Graham Grant Grey Hamilton Henry-James Hutchinson James Johnson Johnson Johnson Junor Lamont Lewis Lewis-Hue Lloyd Lyons Malcolm Malcolm Manning Marriott Mccallum Mcdowell Mcghie Mclaren Mclune Minott Morris Mullings Murray Nelson Pinnock Pringle Reid Reid Reid Reid Richards Ricketts Roach Roberts Grant Rochester Rose Rose

Leonard Lorenzo Michael Melrose Althea Karen Eunice Dorothy Carol Tameka Vincent Aretha Yvonne Nora Edward Clarence Keith Derrick Jublic Doreen Andrea Maureen Barbara Chantelle Cloverleen Leonard Austin Stephen Kan-Lael Gladys Patricia

Saunders Sewell Shaw Sherwood Smith Spence Stone Thomas Thompson Thompson Thompson Thrope Thorpe Tomlinson Tracey Villiers Watson Webster Weir White Williams Williams Williamson Wilson Wilson Wilson Wint Wray Wright Young Young

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Lord, make me an instrument of thy peace. Where there is hatred, let me sow love; Where there is injury, pardon; Where there is doubt, faith; Where there is despair, hope; Where there is darkness, light; and Where there is sadness, joy.

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O Divine Master, grant that I may not So much seek to be consoled as to console; To be understood as to understand; To be loved as to love. For it is in giving that we receive; It is in pardoning that we are pardoned; And it is in dying that we are born to eternal life. Amen

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