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1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 1

Annual Report

2009 Performance... Built On A Heritage Of Community And Care!


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 3

1st National Bank presents its 2010 Annual Report with the same commitment with which we were birthed so many years ago as the nation’s first true indigenous bank, performing since then and giving back to the national community in so many ways. We do so with pride and with the humility of knowing how much more still remains to be done. Our theme for this report, PERFORMANCE... BUILT ON A HERITAGE OF COMMUNITY AND CARE!, speaks to our ongoing commitment to the very founding principles that have charted our course this past year and every one gone before and still to come. We reflect on the one-on-one commitment through the cover of our report with just some of the thousands of faces and places with which we have built relationships, coming together to form the essence of who we are as a corporate entity. Our past year in many ways reflects this same consistent approach. In the area of

altruism, we continue to support many worthy causes, positively impacting on youth, sport, culture and national skills development. Our commitment to always seeking and making available the appropriate industry innovations saw us launching an array of technology tools to keep our customers at the leading edge of international convenience banking. But our local sensitivity and special relationship with our communities was also further deepened through our special banking hours and deep community-level relationships and support. Our theme of performance and the rock of heritage on which it is based, resonates at the highest levels of the Bank and as an institution of development, we present this report as a virtual national document for all. From the one-on-one personal relationships with each customer, to the surrounding community and national community, we perform to our utmost, to never fail to be first to offer our best to our country.

Annual Report

2009 Performance... Built On A Heritage Of Community And Care!


Vision Statement 1st National Bank St. Lucia Limited is the first choice financial services provider and an outstanding corporate citizen, achieving excellent customer satisfaction and sustained financial growth.

Mission Statement To contribute to national development by creating value for shareholders through the provision of financial services to local, regional and international individuals and corporate clients. This will be achieved by creating value and satisfaction for our customers through excellent service driven by a highly skilled, empowered, visionary and inspired team using appropriate technology, supported by good corporate governance.

Core Values Integrity • Professionalism • Confidentiality


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 5

ANNUAL REPORT 2009

Contents 6

Notice of Meeting

7

Corporate Data

8

Financial Highlights

12 Board of Directors’ Report 16 Board of Directors 20 Managing Director’s Report 34 Management Team 38 Management Organization Chart 39 Auditor’s Report 40 Balance Sheet 41 Statement of Income 43 Statement of Changes in Equity 44 Statement of Cash Flows 45 Notes to the Financial Statements


Notice Of Meeting Notice is hereby given that the 72nd Annual Meeting of Shareholders of the 1st National Bank St. Lucia Limited will be held at the National Insurance Corporation Conference Room, Francis Compton Building, Waterfront, Castries, on Thursday, 29th April, 2010 at 5:00 p.m. AGENDA 1. 2. 3. 4. 5. 6. 7. 8.

Tabling of Proxies To confirm the Minutes of the Annual Meeting of Shareholders of 30th April, 2009 Matters arising out of the Minutes To consider and adopt the 2009 Report of the Board of Directors To consider and adopt the Auditor’s Report to the Shareholders To consider and adopt the Audited Financial Statements for the year ended 31st December, 2009 To sanction a dividend of $0.40 cents per share as recommended by the Board of Directors To elect three Directors. The Directors retiring by rotation and who are eligible for re-election are:t .ST$IBSNBJOF(BSEOFS t .S$ZSJM.BUUIFX t .S-JPOFM+BNFT NOTE: Nominations may be made either in writing or on the prescribed forms and must reach the Bank’s registered office at least five (5) days before the day of holding the meeting.

9. To appoint and fix the remuneration of the Auditor. NOTE: A Shareholder entitled to attend the meeting and vote may appoint a proxy to vote in his/her place. A person appointed by proxy need not be a shareholder. The instrument appointing a proxy shall be in writing under the hand of the appointer or of his/her attorney duly authorized in writing, or if such appointer is a corporation, either under its common seal or under the hand of an officer or authority so authorized. The instrument appointing a proxy and the power of attorney or other authority if any under which it is signed or a notarially certified copy of that power of authority shall be deposited at the registered office of THE COMPANY not less than forty eight hours before the time for holding the meeting at which the person named in the instrument proposes to vote and in default the instrument of proxy shall not be treated as valid. NOTICE is also hereby given that the Share Transfer Book of the Bank will be closed from 16th April, 2010 to 29th April, 2010 both dates inclusive.

BY ORDER OF THE BOARD Beryl Carasco-Alleyne Corporate Secretary Performance... Built On A Heritage Of Community And Care! | PG 6


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 7

Corporate Data HEAD OFFICE

BUREAU DE CHANGE

Reduit, Gros Islet P. O. Box 168, Castries Tel : (758) 455 7000 Fax : (758) 453 1630

SLASPA Ferry Terminal Faux a Chaux, Castries Tel : (758) 453 0041 Fax: (758) 451 8482

CASTRIES BRANCH

SWIFT: LUOBLCLC Email: manager@1stnationalbankslu.com Website : www.1stnationalbankonline.com

#21 Bridge Street, P. O. Box 168, Castries Tel : (758) 455 7000 Fax : (758) 453 1630

SUB BRANCH

J.Q’s Mall Rodney Bay, Gros Islet Tel : (758) 452 8882/3 Fax: (758) 452 8884

SUB BRANCH

Marina Village Marigot Bay, Castries Tel: (758) 458 3744 Fax: (758) 458 3638

SUB BRANCH

DIRECTORS

Charmaine Gardner President Cyril Matthew 1st Vice President Ferrel V. Charles 2nd Vice President Brenda Floissac-Fleming Nigel Fulgence Joseph Maxwell Christian Husbands Lionel James Johnson Cenac Tedburt Theobalds

Commercial Street P.O. BOX 342 Vieux Fort Tel : (758) 454 6213 Fax : (758) 454 6137

G. Carlton Glasgow Managing Director

BUREAU DE CHANGE

AUDITOR

George F.L. Charles Airport Vigie, Castries Tel : (758) 453 1683 Fax: (758) 451 8482

SOLICITORS

Floissac, Fleming & Associates

PricewaterhouseCoopers


Financial Highlights 2009 $ ‘ 000

2008 $ ‘ 000

2007 $ ‘ 000

2006 $ ‘ 000

2005 $ ‘ 000

Interest income

30,587

29,681

25,403

24,015

18,332

Interest expense

11,883

10,763

9,046

7,303

6,342

Net interest income

18,704

18,918

16,357

16,712

11,990

4,866

4,056

5,646

4,468

3,479

11,622

10,515

9,028

8,157

7,039

9,114

9,096

10,539

9,291

5,992

365,377

329,405

297,510

269,514

223,758

7,971

7,971

7,971

6,877

5,599

66,204

56,239

49,339

39,077

29,591

436,072

390,152

351,468

314,392

260,272

5,000

5,000

5,000

4,635

4,209

$

$

$

$

$

Dividends Declared

0.40

0.40

0.40

0.35

0.30

Earnings per share

1.82

1.82

2.17

2.10

1.47

13.24

11.25

9.87

8.43

7.03

Return on Assets

2.09%

2.33%

3.00%

2.96%

2.30%

Return on Equity

13.77%

16.17%

21.36%

23.78%

20.25%

Net Interest Margin

4.29%

4.85%

4.65%

5.32%

4.61%

Productivity

49.3%

45.8%

41.0%

38.5%

45.5%

95

94

90

82

80

OPERATING RESULTS

Other income Other operating expenses After tax income BALANCE SHEET DATA Customer deposits Common shareholder equity Total shareholder equity Total Assets Common shares issued & paid (‘000) PERFORMANCE

Book Value

Average Employees

Performance... Built On A Heritage Of Community And Care! | PG 8


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 9

12% Increase in Total Assets over 2008

49.3% 11% Cost Efficiency

Increase in Customer Deposits over 2008


+ $46

TOTAL ASSETS

+ $36

CUSTOMER DEPOSITS

+ $33

TOTAL LOANS

Assets—Increase in Millions

Deposits—Increase in Millions

Loans—Increase in Millions (net)

2008 = $390 million 2009 = $436 million TARGET —> $425 million

2008 = $329 million 2009 = $365 million TARGET —> $353 million

2008 = $248 million 2009 = $281 million

TARGET —> $262 million

Performance... Built On A Heritage Of Community And Care! | PG 10

^ ^ ^


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 11

COST EFFICIENCY BANK – 49.3% INDUSTRY AVERAGE – 60%

CAPITAL ADEQUACY RATIO BANK – 21% ECCU – 19%


Board of Directors’ Report

Performance... Built On A Heritage Of Community And Care! | PG 12


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 13

0VSNFBTVSFESFTQPOTFTUPUIFmOBODJBMDSJTJTZJFMEFE BSFTVMUCFUUFSUIBODPVMEIBWFCFFOBOUJDJQBUFEBU UIJTUJNFMBTUZFBS Due diligence, sound corporate governance and conservative banking practices are catch phrases that have become almost clichÊ in the halls of the 1st National Bank. These principles have enabled our Bank to survive the economic vicissitudes of the last twelve months and a most serious global recession. The Bank has maintained a profit after tax of $9.1 million and a 12% growth in the balance sheet position, in comparison to the previous financial year. Strict adherence to the historic 1st National Bank creed of sound financial banking principles, together with an inestimable amount of hard work by your Board, your Senior Management right through to staff members, has enabled us to reach this present position. Underlying the balance sheet growth is the strategy to maintain a strong Tier 1 capital adequacy ratio of over 15% to foster shareholder and public confidence; we are gratified with the result of 21%. Moreover, the Bank’s overall condition has improved, a fact confirmed by the Eastern Caribbean Central Bank after their 2009 examination. Book value per share has grown from $11.25 to $13.24 and the earnings per share are stable at $1.82. Customer service excellence is central to all our strategic

initiatives. Our recruitment process ensures that our human resources have the right aptitude and skill set, augmented by continuous training to drive service delivery. We remain focussed on the strategy to use appropriate modern information technology to deliver that level of service. Mobile banking, a new addition to our suite of products was well received, with new features to be added in 2010. Additionally, the Bank plans to introduce its own branded debit and credit cards to enhance accessibility of funds to customers. Our plans to enhance our customers’ banking experience are progressing satisfactorily. These include: • the commissioning of a new Sub - Branch to be located in Choc Bay during the second quarter of 2010, • the construction of a three storey office building on #18 Bridge Street, • the refurbishment of the main branch at #21 Bridge Street, • the expansion of the Rodney Bay Sub - Branch. Over the years, we have built a strong corporate social presence by the support of development projects focussing on youth, education, the arts and the environment. At the

recently held St. Lucia Business Awards, the Bank received three awards in recognition of the work done during 2009 in the areas of Corporate Social Responsibility, Innovation and Service Excellence. Indeed, some members of the Board of Directors, management and staff engage in philanthropic and voluntary work on behalf of the Bank.


GOVERNANCE

DIVIDEND

Good corporate governance remains a priority for the Board of Directors as it is central to the integrity of the Bank. The Corporate Governance Policy which is now complete, covers matters of responsibilities, powers and structure of the Board of Directors, terms of reference for each Board Committee, code of conduct for Directors and minimum requirements to meet fit and proper criteria to serve as a Director on the Board.

The Board recommends maintaining a stable dividend payout of $0.40 per share, resulting in a dividend yield of 13%. This represents a total payout of $2 million and constitutes 22% of profit after tax. This dividend payout is compatible with internal policies and regulatory guidelines and takes into account our growth strategies, which include capital expenditure on our physical plant.

The composition of the Board of Directors remained unchanged during 2009. Directors’ contributions were candid, co-operative and meaningful, deriving from a wide range of experience and training in law, accounting, finance, educational administration, insurance, engineering, business and agriculture. During the year under review, Directors benefited from training in and exposure to banking related seminars and conferences relevant to enhancing their capacity to fulfil their corporate governance responsibilities as follows: 1. Members of the Audit Committee attended the third annual conference of the Caribbean Association of Audit Committee Members (CAACM) held in St. Lucia. 2. The Board of Directors attended a Balanced Scorecard Strategy review presented by Growth Facilitators 3. All Directors attended a seminar on Corporate Governance facilitated by Dr. Valda Henry of VF Inc. 4. Two Directors successfully completed the Director Education and Accreditation Program (DEAP) accredited with the Institute of Chartered Secretaries and Administrators of Canada. 5. One Director attended a meeting with the ECCB Monetary Council, ECCU Financial Secretaries and the Board of the Eastern Caribbean Central Bank, with specific reference to Economic and Financial Adjustments in the ECCU. This meeting was held in St. Kitts. 6. Two Directors attended the Annual General Meeting and Conference of the Caribbean Association of Indigenous Banks (CAIB) in Antigua.

MEETINGS The Board and its Committees met regularly, providing the necessary oversight of the strategic direction of the Bank. The relevant data on meetings for 2009 is illustrated in the table over leaf, with the exclusion of the Credit Risk Committee as agreed by shareholders. The Credit Risk Committee met four times in 2009, with 100% participation by four members; one member’s attendance was 75%. Special sub-committee meetings were held during 2009 to discuss matters pertinent to the property on #18 Bridge Street.

ACKNOWLEDGEMENTS Our measured responses to the financial crisis yielded a result better than could have been anticipated at this time last year and for this, we thank the staff for their consistent delivery of quality service for which we stand apart. We thank management for skillfully steering the Bank, our customers and shareholders for their unswerving support, our business partners and the public for their candid contributions and continued interest in the Bank. We take this opportunity to extend our deepest condolences to Director Ferrel Charles on the passing of his wife, Mrs. Patricia Ellen Charles who was also a shareholder and an active and involved member of our community. At this juncture we offer our condolences to the families of those shareholders who have passed in 2009. As we continue this most challenging journey, we take pride in the work we have done to chart the course to attain the goal of being the 1st choice financial services provider.

OUTLOOK The announcement by the Governor of the Eastern Caribbean Central Bank of an eight point plan as a plausible response to the economic crisis is laudable. However, we anticipate that the implementation of point seven of that plan, being the amalgamation of indigenous commercial banks of the Eastern Caribbean Currency Union (ECCU), will be received with mixed feelings. In this light, it has been noted that our existing relationship with ECIC Holdings Ltd is a vehicle by which ties with other indigenous institutions can be deepened in the ECCU, without creating a new structure, thus retaining the identity of each indigenous institution. The adoption of the Financial Services Regulatory Authority Act and Insurance Act will be a welcome step towards improved regulation and improved security of funds, be it in insurance, banking or non banking financial institutions. As the discussions ensue, we give the assurance that the Bank will adequately and expertly represent our interest, thereby ensuring safety of customer and shareholder funds.

Performance... Built On A Heritage Of Community And Care! | PG 14

Dr. Charmaine Gardner President, on behalf of the Board of Directors


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 15

Directors’ Attendance At Board And Committee Meetings For The Year Ended December 31, 2009 DIRECTORS

FINANCE, PLANNING & INVESTMENT

BOARD No. of Meetings

Actual Attendance

Charmaine Gardner

11

11

Cyril Matthew

11

11

Ferrel Charles

11

10

Brenda FloissacFleming

11

9

Nigel Fulgence

11

10

Joseph Maxwell

11

11

7

7

Christian Husbands

11

11

7

6

Lionel James

11

11

7

6

Johnson Cenac

11

10

Tedburt Theobalds (Audit Committee member from September 2009)

11

10

G. Carlton Glasgow

11

11

No. of Meetings

7

Actual Attendance

HUMAN RESOURCE No. of Meetings

Actual Attendance

No. of Meetings

Actual Attendance

6

5

No. of Meetings

Actual Attendance

2

2

2

2

2

2

2

2

6 3

3

3

2

6

4

3

3

6

5

3

3

6 7

CORPORATE GOVERNANCE

AUDIT

6

3

3

3


DR. CHARMAINE GARDNER

Chairperson/ President

MR. CYRIL MATTHEW

MR. FERREL CHARLES

MRS. BRENDA FLOISSAC-FLEMING

MR. NIGEL FULGENCE

1st Vice President

2nd Vice President

Board of Directors Member

Performance... Built On A Heritage Of Community And Care! | PG 16

Member


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 17

MR. JOSEPH MAXWELL Member

MR. CHRISTIAN HUSBANDS Member

MR. LIONEL JAMES Member

Board of Directors MR. JOHNSON CENAC Member

MR. TEDBURT THEOBALDS Member

MR. G. CARLTON GLASGOW

Managing Director


We care that you have the time for what you love, this is why we have brought you the convenience of Online & Mobile Phone Banking Performance... Built On A Heritage Of Community And Care! | PG 18


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 19


Managing Director’s Report I am pleased to present another satisfactory report for the Bank for the financial year ended 2009, despite the negative growth experienced by our Country during the year. This negative growth, driven by the global financial crisis has impacted on our loans and advances to customers portfolio to a fair degree, resulting in an increase in non performing assets. The current law on debt recovery continues to be a challenge, so too is competition on interest rates for loans and deposits, which in some instances creates imperfect market conditions and responses. In spite of these challenges, the Bank’s Balance Sheet grew appreciably by 12% over the audited position for 2008 to $436 million. The profit before and after tax for 2009, is a modest $10.4 million and $9.1 million respectively. This performance would not be possible without the continued focus on the Bank’s strategic initiatives, both planned and emergent. Our priority continues to be the development and engagement of our human resources as a

core competence to ensure tenacious risk management, high asset quality and excellent customer satisfaction. We endeavour to be prudent in our decision making, always placing safety of customer funds first. During the year, the Bank’s Head Office was temporarily relocated in line with plans to address our space constraints. Alternative plans pursued to leverage our presence on Bridge Street did not materialize and consequently, the original strategy is at the advanced planning stage, which in the main will satisfy our need for additional space for at least another decade. Efforts to grow the Bank and achieve excellent customer satisfaction were recognised at the Annual Business Awards Ceremony mounted by the St. Lucia Chamber of Commerce, Industry and Agriculture when the Bank captured three awards, one each for innovation, corporate social responsibility and service excellence. We pledge to maintain this level of excellence and commitment.

In spite of these challenges, the Bank’s Balance Sheet grew appreciably by 12% ...to $436 million Performance... Built On A Heritage Of Community And Care! | PG 20


TOTAL INCOME

$’000


Risk Management The Bank manages its exposure to risk based on its policies and in accordance with laws and regulations. Generally, traditional methods of risk management are employed in the management of the Bank’s assets. The Board, through its committees is also involved in the management of risk by approving adjustments to policies and monitoring performance against them.

Outlook It is anticipated that the economic conditions prevalent in 2009 will continue to impact our operations in the short to medium term. Growth of gross domestic product for St. Lucia is expected to be slow but negative for 2010. We anticipate that there will be need to finance and support the recovery efforts and we stand ready to do our part and to encourage rational behaviour to realise this effort. The forecast for the tourism industry is very positive and was used to support our budget which is optimistic in its thrust. Government efforts to sustain the economy via fiscal policies have been endorsed by the International Monetary Fund and one such measure, the implementation of a Value Added Tax, appears to have received the approval of the public at large. We foresee increased competition in a relatively stable market space and our response will include maintaining awareness of our brand and greater focus on our operational strategies to reduce risk, particularly credit risk. We are mindful of the ongoing challenges and will continue to monitor these challenges to ensure that the Bank remains on the path of value creation.

Customer Service In the interest of achieving excellent customer satisfaction and enhancing customer access to their accounts, the Bank embarked on a number of projects. However, cognizant of the global recession, a conscious decision was taken to implement projects that would greatly enhance the Bank’s image, customer service and efficiency during the course of 2009 and beyond. Our MoBanking product was presented at a successful media launch, attended by customers, Board members and Staff. This product was a collaboration of five other indigenous banks in the Eastern Caribbean Currency Union, spearheaded by ECIC Holdings Ltd. Customers are able to access their accounts via their cell phone to make enquiries on their accounts, view account transaction histories, receive alerts when deposits, including salaries, are paid into their accounts, and pay utility bills. This is enabled via access to the Bank’s core system with cell phones utilizing SMS texting or any cell phone with a web browser. Performance... Built On A Heritage Of Community And Care! | PG 24

This product was historic for the Bank as we were first to market with such an innovative product in St. Lucia. We are happy to report that all product features are functional and customers have expressed their overall satisfaction. The Bank implemented a new product called E-Alerts, for which customers could sign up to be remotely notified of transfers to and from their accounts by text messages or email. This eliminates the need to post advices to customers, thereby saving postage, stationery, and time spent in writing out advices, and mailing or delivering them by hand. Dividend cheque printing was implemented which automated production of the dividend cheques quickly and efficiently. The operation has additional security features which eliminate human error, thereby reducing costs. The Credit Card Payments Manager software initiative went live whereby customers’ credit card payments made island-wide are immediately uploaded, updating their payments to their credit card accounts held at The Caribbean Credit Card Corporation (4C’s) in St. Kitts. The Bank’s Card Services system was upgraded and made ready for the International Debit Card Project which will be completed by May 2010. Additionally, ATM card-reader anti-tamper devices were installed on all ATMs. The devices are designed to prevent fraudsters from setting traps to capture customers’ ATM cards. The telephone system was upgraded with the installation of Voice over Internet Protocol (VoIP) digital telephone system. This enables Branches to be interconnected by telephone extensions and improves the ease with which customer service is managed at the same time resulting in cost savings for each operating unit and the Bank on the whole. The Bank continues to be guided by its mission statement by providing appropriate cutting


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 25

edge technology for use by customers. The results of a customer survey recently completed by the University of the West Indies will indicate the impact of our past initiatives as well as inform our future strategies.

ii. • •

Human Resources

• •

During the year under review, Human Resource development and management remained focused on the learning and growth perspective of the Bank’s key strategic objectives. Consequently, emphasis was placed on:• • • •

Employee empowerment and motivation through:

III.

The promotion of six employees from within the Bank’s Supervisory grades to facilitate smooth internal succession as necessary; The granting of staff annual performance increases in line with industry standards; Special recognition of employees at the Bank’s annual awards function; Acknowledgement of the overall contribution of all eligible staff by way of their participation in the Bank’s profit sharing plan. Upgrading of the working environment:

Cultivating an ethic of inspirational leadership throughout the institution; Developing highly competent, empowered and committed employees; Providing relevant skills and resources to facilitate staff efficiency; and Creating a professional working environment.

The creation of a more spacious and healthy working environment is undoubtedly conducive to the proper functioning, comfort and satisfaction of the Bank’s staff. Indeed, the 2008 staff survey highlighted the need to expedite this.

In 2009 the Bank made significant progress towards achieving those objectives through implementation of the following initiatives:-

In 2009 the Bank accomplished the initial phase of the process aimed at alleviating the existing space constraints within some of the Bank’s business units and refurbishing as necessary.

I. II. III. IV. V. I.

Continuous staff training bank-wide; Employee empowerment and motivation; Upgrading of the working environment; Planning a revised Performance Management System (PMS); Provision of the requisite resources to carry out the job.

Continuous staff training bank-wide with emphasis on: • • • • • • • • • • • • • • • •

Building leadership capacity Corporate governance Customer care and service Management of credit risk Credit appraisal techniques Corporate treasury/cash management Enhancing expertise in information technology IT controls audit skills Communication and sales skills Strengthening of technical competencies Entry level employment skills Orientation to new products and services Information security governance Anti-money Laundering policies and procedures Assistance to staff enrolled in professional banking programmes Assistance to staff engaged in professional self-development

In the second quarter of 2009, the Bank’s Head office was relocated from above the Castries Branch to premises at Reduit, Gros- Islet. This temporary move was effected to facilitate the refurbishment of the Bank’s Bridge Street offices during 2010, as well as generate increased office space in the interim. Plans for the extension of the Rodney Bay Sub Branch were also advanced in 2009 in keeping with the level of business at that unit and the evident need to improve the working environment. The Vieux- Fort Branch was also repainted. IV.

Planning a revised Performance Management System (PMS): •

all management personnel participated in the PMS redesigning process which is linked to the Bank’s existing Balanced Scorecard Strategy and Corporate objectives

the PMS is structured towards greater emphasis on setting employee action plans and targets, competency assessment, coaching and performance measurement;

the PMS more specifically enables individual performance in order to achieve organizational excellence;

the PMS also incorporates some of the key outcomes of the staff satisfaction survey conducted in 2008.


The implementation component of the Performance Management System throughout the Bank is planned for early 2010. V.

Provision of the requisite resources to carry out the job

During the year under review much emphasis was placed on enhancing the technological resources available to staff in carrying out their functions. The positive impact on staff productivity and efficiency was enabled by the automated dividend cheque printing facility; the customer account E-Alert; the Bank’s updated telephone system; and the MoBanking product, all of which were introduced in 2009. Additionally, the improved Performance Management System (PMS) mandates that Managers and Supervisors document the tool requirement for each position within their department/Unit. This is expected to be effected as part of the full implementation of the PMS in 2010.

Corporate Social Responsibility For over seventy one (71) years, the Bank’s commitment to the community has been a key component of our heritage and culture. During the financial year ended 2009, the Bank distinguished itself through consistent and well assigned financial support for initiatives proposed by various persons and organizations. It is this dedication to the community that earned the Bank the coveted national award for Corporate Social Responsibility for its work in the following areas: • • • • • • •

Every year, selected employees make time to counsel students of the Sir Arthur Lewis Community College on aspects of banking and ethics in the workplace. Additionally, mock job interviews were conducted with final year students to prepare them for the job market, an activity that was well received. We at the Bank are not only interested in ensuring that opportunities are created for educational advancement but are also concerned about the learning environment for students. We provided and installed two air conditioning units at the resource centre of the Mon Repos Combined School, thereby protecting sensitive equipment like computers and creating an enabling environment where students and teachers can work in comfort. The Clendon Mason Secondary School was also a recipient of the Bank’s support in the field of Agriculture. The Bank ensured that the schools kitchen garden received the attention that was needed for a successful harvest. It is interesting to note that the school donated part of its harvested crops to the home for the elderly in the Village of Dennery.

Educational Development Financial Education and Empowerment Social Transformation Community Outreach Programs Cultural Development and Preservation Sporting Activities Environmental Projects

Educational Development In the area of education, the Bank continues to make financing available to students who wish to pursue higher education through its comprehensive and attractive Scholarship Program. During 2009, another young St. Lucian shareholder (Donavan Foster) was assisted with his university education when the Bank awarded him a two year scholarship to complete studies in Economics and Law. We are proud to advise that the Bank currently employs two former scholarship holders who have done well in their field. Additionally, student loans are available to all persons wishing to pursue tertiary education in various courses particularly those on the Government’s priority list.

Performance... Built On A Heritage Of Community And Care! | PG 26

The Jacmel Combined School also benefited from the Bank’s generosity when a small state-of-the-art document centre was donated to the school to assist with printing and photocopying.


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 27

The Centre for Adolescent Renewal and Education (CARE) is another institution that continues to receive assistance from the Bank in terms of technical and financial support. We believe that every individual deserves an opportunity to excel and thus the work of the Centre in providing an important educational alternative for adolescents who dropped out of the formal education system is worthy of our support. Financial Education And Empowerment 1st National Bank has used an integrated communication strategy to enhance financial literacy. Through its flagship television program 1st National Bank Notes, the Bank sought to educate its customers and the general public on a wide range of financial topics including, budgeting, savings and investments, loans and value added tax. Our staff continues to counsel customers during their service delivery. We intend to broaden the scope of activities taking our educational drive to the communities which we serve. Social Transformation Our responsibility to collectively influence thinking and consciousness within our society is evident from the projects and initiatives that we consider deserving of our support. These include our support to: 1. The St. Lucia Crisis Centre. This organization received funding from the Bank to expand its awareness programs. 2. The Ministry of Gender Relations in its quest to end gender based violence. 3. The importance and recognition of women in society. Twelve excellent young women from St. Lucia in various professions were highlighted for their sterling contribution to society in our 2009 calendar with the theme “Our Young Women Of Tomorrow… Today”, Applauding The Pursuit Of Excellence. The information provided in the calendar is used in many schools and libraries across the island to inspire and inculcate values in young women from all walks of life.

4. The Caribbean Youth Festival. The Bank seeks to foster positive change in the lives of our youth and we recognized potential in the festival that combines local and regional talent to spread positive messages through music and song. The proceeds go towards the sustainability of a youth development clinic in Vieux Fort as well as to the Centre for Adolescent Renewal and Education (CARE), an institution the Bank has supported directly over the years. 5. The Community Action Programme for Safety (C.A.P.S.). This organization received financial support to further promote its objective to reduce opportunities for crime and promote positive conflict resolution. 6. Act Now Generation. This is a program targeted at young persons in conflict with the law. The program is administered by the District Courts in collaboration with the Probation Department. 1st National Bank is aware of the challenges faced by our youth both here and abroad. It is because of this awareness that the Bank sponsored the collaborative effort of Act Now Generation of Barbados and St. Lucia in the staging of a theatrical production entitled “The Land, the People, the Light” in recognition of St. Lucia’s 30th Independence Anniversary Celebrations. 7. The St. Lucia National Principals Association hosted principals from the region for the Principals Conference. The conference came to a close with a cultural and food presentation evening that saw the Bank once again in support of this activity staged by the region’s foremost educators.


Community Outreach The Bank’s community outreach program is very well structured and aligned to the Bank’s strategic goals. We ensure that the Bank lives up to its responsibility as a Community Bank and reinvests appropriately in the community. During the year, the Bank embarked on establishing a number of covenants with various key organizations and institutions in St. Lucia, in an effort to augment the sustainability of their community programs and philanthropic work. Some of the beneficiaries of this corporate gesture of goodwill are: 1.

The St. Lucia Blind Welfare Association, for their Kids in Sight program.

2.

The National Community Foundation, to support their mandate in various areas like education, youth at risk, health, that benefit thousands annually.

3.

The Marian and the St. Lucy’s Homes for the elderly.

4.

The St. Lucia Sickle Cell Association, in the provision of equipment and

vaccines.

5.

The Cluny Foundation, for educational development.

6.

Centre for Adolescent Renewal and development.

7.

Education, to assist with youth

Catholic Television Broadcasting Service, in the provision of spiritual

enlightenment.

The Bank also partners with organizations which conduct summer programs for underprivileged children, be it in the field of sports, arts and crafts, education, culture, drama, dance, music and poetry. The Bank is there at every step, investing its time and money to ensure that the benefits to be derived in terms of discipline, team work, self confidence, esprit de corps would result in more functional and productive citizens for St. Lucia. Arts And Cultural Development In 2009 the Bank was again proud to be associated with the University of the West Indies Open Campus in securing and preserving the works and artefacts of renowned St. Lucian Playwright Roderick Walcott. This gesture of support by the Bank paves the way for many generations of local, regional and international students to fulfil research requirements into the Literary Arts. Fond d’or Jazz, one of the main activities of the Fond d’or Foundation, was in danger of being cancelled but for the increased sponsorship from the Bank. We understood the economic benefits to be derived from staging this unique cultural event and we support their work to maintain and preserve the historical artefacts and the environment. Carnival is considered to be St. Lucia’s premier annual cultural festival. The Bank contributed financially to many carnival related events including steel pan, costume bands and calypso. The St. Joseph’s Convent Steel Orchestra received some financial support to travel to Trinidad and Tobago to experience first hand that country’s panorama. The Rituals Carnival Band, Dame Pearlette Louisy Primary School kiddies’ Carnival Band and the St. Aloysius Roman Catholic Boys Primary School Calypso competition were recipients

Performance... Built On A Heritage Of Community And Care! | PG 28


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 29

of financial support from the Bank. Furthermore, the Bank made a monetary contribution to the Police in support of their calypso competition, which brings the police and the community together. The Bank continues its support for the Helen Folk dancers in its quest to preserve our rich dance heritage. The group has staged many dance theatres and workshops to ensure that this part of St. Lucian culture remains alive and passed on to future generations. Another dance group, the Silver Shadows Performing Arts Academy benefitted from our generous donation to assist in the production of “Break Out”, a performance of creative original dance pieces choreographed by St. Lucian Barry George and performed by the young St. Lucian dancers from the Academy. The Show was performed over three days to an appreciative local audience.

Sporting Activities The Bank recognizes the value of sports and sporting related activities in promoting functional communities, team building, discipline, healthy living, friendly rivalry and competition and co-operation. Some of the beneficiaries of Bank funds were as follows: 1.

The 13 and Under Track and Field Championship. For the sixteenth consecutive year, the Bank was proud to be the sole sponsor of the 1st National Bank 13 and Under Track and Field Championship co-ordinated by the St. Lucia Athletics

Association. These games contributed to the development of young well rounded athletes who have gone on to secure athletic scholarships. 2.

The St. Lucia National Netball Association, to ensure St. Lucia’s participation in

the OECS Netball Tournament.

3.

St. Lucia Volleyball Association, to assist with the team’s representation of St.

Lucia. 4. 5.

The OECS Beach Volleyball Tournament. St. Lucia Amateur Swimming Association, for hosting of the National Secondary

Schools Swim Championship. 6.

Many schools benefited from the Bank’s corporate generosity in hosting their annual school sports meet as well as their sports camp in the summer.

The Ministry of Social Transformation, Youth and Sports continues to recognize the Bank for its outstanding contribution to Sports in St. Lucia.


Environment We strive to make a difference in our communities and the Bank staff teamed up with personnel from the Ministry of Agriculture and residents of the Dennery Valley to reforest the river banks, to save our rivers and create awareness and appreciation of our environment. The Bank donated 1,500 trees to this worthwhile project.

and expeditious process for dividend payment. The office of the Corporate Secretary stands ready to assist in this regard. For the information of shareholders, the chart below illustrates the current status of the dates of election and re-election of Directors:ROTATION OF DIRECTORS IN ACCORDANCE WITH SECTION 4 OF BY-LAW NO. 1 YEAR OF ELECTION

YEAR OF REELECTION

CHARMAINE GARDNER

1990

2007

CYRIL MATTHEW

1998

2007

FERREL CHARLES

1980

2009

BRENDA FLOISSAC-FLEMING

1993

2007

NIGEL FULGENCE

2000

2009

JOSEPH MAXWELL

2001

2008

CHRISTIAN HUSBANDS

2003

2009

LIONEL JAMES

2007

JOHNSON CENAC

2008

TEDBURT THEOBALDS

2008

NAME

Shareholder information The number of shares issued and fully paid remained at 4,999,966. However, a total of 63,508 shares was transferred in the course of 2009 and the total number of Shareholder accounts on record stood at 1,337. As required by the Banking Act No. 34 of 2006, no individual shareholder owned more than 20% of the Bank’s total shareholding. During 2009, the automatic cheque payment system for dividends was implemented. This process, which is expected to be fully functional for the timely payment of dividend cheques in 2010 will significantly improve the production and accuracy of dividend payments made by cheque. That notwithstanding, we continue to encourage shareholders to utilize accounts held with the Bank for deposit of their dividend since this is still the most efficient

Performance... Built On A Heritage Of Community And Care! | PG 30


Prime Minister The Honorable Stephenson King presents the award for Innovation to Managing Director Mr. G. Carlton Glasgow.


You can judge a people’s bank by how it cares for it’s young and elderly. This is why we’re heavily invested in both. Performance... Built On A Heritage Of Community And Care! | PG 32


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 33


Management Team

01

02

03

Performance... Built On A Heritage Of Community And Care! | PG 34

01 02 03 04

04

G. CARLTON GLASGOW Managing Director AUREA LAFEUILLEE Finance Manager JOSEPH FEDEE Operations Manager DENISE HOLDEN-PIERRE Manager, Internal Audit

05

05

BERYL CARASCO-ALLEYNE Human Resource Manager/Corporate Secretary

06 07

ROBERT FEVRIER Manager, Projects & Services

06

CLARETTE AUGUSTE-TAYLOR Manager Lendings

07


08 09 10 11

08

VALERY MARSHALL-ST. OMER Assistant Manager, Operations SYLVIA ALCEE Manager, Rodney Bay Sub Branch PATRICIA HOWELL Assistant Manager, Lendings

12 13 14

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 35

NAOMI PROMESSE-EDWARD Manager, Vieux Fort Sub Branch BEVERLEY ANN GREENE Assistant Manager, Finance MANSLEY JULIUS Assistant Manager, Accounting

PETER FLOISSAC Assistant Manager, Recoveries

09

10

11

Management Team

12

13

14


Our People, though often unseen make the things You See and Enjoy... Happen Performance... Built On A Heritage Of Community And Care! | PG 36


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 37

Staff of various Business Units.


Management Organization Chart BOARD OF DIRECTORS

MANAGING DIRECTOR

Manager Lendings

Assistant Manager, Lendings

Assistant Manager, Recoveries

Operations Manager

Assistant Manager, Operations

Manager, Projects and Services

Sub Branch Managers, Rodney Bay, Vieux Fort and Officer in Charge, Marigot Bay Sub Branch

Performance... Built On A Heritage Of Community And Care! | PG 38

Human Resource Manager/ Corporate Secretary

Finance Manager

Assistant Manager, Finance

Assistant Manager, Accounting

Manager Internal Audit


PriceWaterhouseCoopers Pointe Seraphine P.O.Box 195 Castries St. Lucia, West Indies Telephone (758) 456-2600 Facsimile (758) 452-1061

Independent Auditor’s Report March 30th 2010 To the Shareholders of 1st National Bank St. Lucia Limited Report on the Financial Statements We have audited the accompanying financial statements of 1st National Bank St. Lucia Limited (the Bank) which comprise the balance sheet as of December 31st 2009 and the statement of income, statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes.

Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

Opinion

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Bank as of December 31st 2009 and the results of its operations and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

Chartered Accountants

PricewaterhouseCoopers refers to the East Caribbean firm of PricewaterhouseCoopers and the other member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity. A full listing of the partners of the East Caribbean firm is available on request at the above address.

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 39


Balance Sheet | As of December 31, 2009 | (expressed in Eastern Caribbean dollars) Note

2009 $

2008 $

5 6 7 8 9

29,307,645 5,976,620 16,832,105 47,965,561 280,947,796

29,208,566 5,088,351 17,910,470 38,642,361 248,470,227

11 11

12,285,162 22,556,356 1,731,068 15,331,161 2,920,830 218,194

12,789,462 22,171,742 1,018,873 12,474,455 2,347,028 30,846

436,072,498

390,152,381

365,377,016 3,832,385 659,000

329,404,588 3,769,600 739,000

369,868,401

333,913,188

7,971,454 44,700,869 13,531,774

7,971,454 37,539,794 10,727,945

66,204,097

56,239,193

436,072,498

390,152,381

Assets Cash and balances with Central Bank Due from other banks Treasury bills Loans and advances to financial institutions Loans and advances to customers Investment securities: - available-for-sale - held-to-maturity Income tax recoverable Property, plant and equipment Other assets Deferred income tax asset

12 13 17

Total assets

Liabilities Due to customers Other liabilities Retirement benefit obligations

14 15 16

Total liabilities

Equity Capital and reserves attributable to the Bank’s equity holders Share capital Retained earnings Other reserves Total equity Total liabilities and equity

18

Approved by the Board of Directors on March 17, 2010 ___________________________________ Director

_______________________________ Director

Performance... Built On A Heritage Of Community And Care! | PG 40


Statement of Income | For the year ended December 31, 2009 | (expressed in Eastern Caribbean dollars) Note

2009 $

2008 $

Interest and similar income

20

30,587,169

29,680,766

Interest expense and similar charges

20

(11,883,032)

(10,762,836)

18,704,137

18,917,930

4,866,109

4,056,350

23,570,246

22,974,280

Net interest income Other operating income

21

Operating income Other operating expenses

22

(11,621,901)

(10,514,717)

Impairment losses on loans and advances

10

(1,577,771)

(1,248,031)

Profit before income tax Income tax expense

10,370,574 25

Profit for the year

11,211,532

(1,256,102)

(2,115,966)

9,114,472

9,095,566

1.82

1.82

Earnings per share for profit attributable to the equity holders of the Bank during the year (expressed in EC$ per share) - basic and diluted

26

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 41


Statement of Comprehensive Income | For the year ended December 31, 2009 | (expressed in Eastern Caribbean dollars) Profit for the year

2009 $

2008 $

9,114,472

9,095,566

2,723,259

–

56,812 70,347

(195,279) –

127,159

(195,279)

2,850,418

(195,279)

11,964,890

8,900,287

Other comprehensive income Gains on revaluation of land and buildings Fair value gains/(losses) on available-for-sale financial assets Unrealised net gains/(losses) arising during the year Net reclassification adjustments for realised net gains Net fair value gains/(losses) on available-for-sale financial assets Total other comprehensive income/(loss) for the year Total comprehensive income for the year

Performance... Built On A Heritage Of Community And Care! | PG 42


Statement of Changes in Equity | For the year ended December 31, 2009 | (expressed in Eastern Caribbean dollars) Share Capital $

Statutory Reserve $

Revaluation Reserve $

Revaluation Reserve – available-forsale $

7,971,454

7,971,454

2,285,636

689,040

30,421,308

49,338,892

Profit for the year

9,095,566

9,095,566

Fair value losses on available-forsale financial assets

(195,279)

(195,279)

Total comprehensive income

(195,279)

9,095,566

8,900,287

Dividends relating to 2007

(1,999,986)

(1,999,986)

Transfer to retained earnings

(22,906)

22,906

Balance at December 31, 2008

7,971,454

7,971,454

2,262,730

493,761

37,539,794

56,239,193

Balance at January 1, 2009

7,971,454

7,971,454

2,262,730

493,761

37,539,794

56,239,193

Profit for the year

9,114,472

9,114,472

Gains on revaluation of land and buildings

2,723,259

2,723,259

Fair value gains on available-forsale financial assets

127,159

127,159

Total comprehensive income

2,723,259

127,159

9,114,472

11,964,890

Dividends relating to 2008

(1,999,986)

(1,999,986)

Transfer to retained earnings

(46,589)

46,589

7,971,454

7,971,454

4,939,400

620,920

44,700,869

66,204,097

Balance at January 1, 2008

Balance at December 31, 2009

Retained Earnings $

Total Equity $

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 43


Statement of Cash Flows | For the year ended December 31, 2009 | (expressed in Eastern Caribbean dollars) Note Cash flows from operating activities Profit before income tax Adjustments for: Depreciation Impairment losses on loans and advances Retirement benefit obligations Dividend income Interest and similar income Interest expense and similar charges

12 10 21 20 20

Cash flow before changes in operating assets and liabilities Increase in mandatory reserve deposits with Central Bank Increase in loans and advances to financial institutions Increase in loans and advances to customers (Increase)/decrease in other assets Increase in due to customers Increase/(decrease) in other liabilities Cash used in operations Interest and similar income received Interest expense and similar charges paid Income taxes paid

2009 $

2008 $

10,370,574

11,211,532

1,068,207 1,577,771 (80,000) (81,630) (30,587,169) 11,883,032

834,094 1,248,031 12,000 (50,810) (29,680,766) 10,762,836

(5,849,215)

(5,663,083)

(2,248,860) (9,181,709) (33,161,734) (573,802) 35,577,951 11,143

(4,770,570) (6,625,331) (24,653,415) 310,337 32,010,267 (160,608)

(15,426,226)

(9,552,403)

29,578,936 (11,488,555) (2,155,645)

28,268,360 (10,878,289) (2,874,199)

508,510

Net cash generated from operating activities Cash flows from investing activities Proceeds from sale/(purchase) of treasury bills, net Purchase of investment securities Proceeds from sale of investment securities Dividends received Purchase of property, plant and equipment

4,963,469

1,058,366 (24,610,805) 24,850,785 81,630 (1,201,654)

(2,380,738) (45,007,984) 39,782,072 50,810 (1,625,366)

178,322

(9,181,206)

Cash flows from financing activities Dividends paid on ordinary shares

(1,948,344)

(1,962,483)

Net decrease in cash and cash equivalents

(1,261,512)

(6,180,220)

Cash and cash equivalents, beginning of year

14,853,347

21,033,567

13,591,835

14,853,347

Net cash generated from/(used in) investing activities

Cash and cash equivalents, end of year

28

Performance... Built On A Heritage Of Community And Care! | PG 44


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 45


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Performance... Built On A Heritage Of Community And Care! | PG 46


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 47


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Performance... Built On A Heritage Of Community And Care! | PG 48


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 49


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Performance... Built On A Heritage Of Community And Care! | PG 50


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 51


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Performance... Built On A Heritage Of Community And Care! | PG 52


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 53


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Performance... Built On A Heritage Of Community And Care! | PG 54


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 55


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Performance... Built On A Heritage Of Community And Care! | PG 56


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Due from other banks Treasury bills Loans and advances to financial institutions Loans and advances to customers: − Overdraft − Demand loans − Promissory notes − Mortgages Investments securities: − available for sale − held to maturity Other assets Credit risk exposures relating to off-balance sheet items are as follows: Financial Guarantees Loan commitments and other credit related liabilities At December 31

Maximum exposure 2009 2008 $ $ 5,976,620 5,088,351 16,832,105 17,910,470 47,965,561 38,642,361 13,918,905 126,920,339 11,254,777 128,853,775

11,557,424 113,270,801 8,418,705 115,223,297

8,607,692 22,556,356 1,909,761

9,431,682 22,171,742 1,839,745

4,199,510 24,695,113

3,707,216 25,371,125

413,690,514

372,632,919

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 57


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

2009

2008

$

$

174,530,840

150,515,962

Past due but not impaired

85,436,909

79,527,603

Impaired

34,142,461

32,657,984

Gross

294,110,210

262,701,549

Less: allowance for impairment (Notes 9 and 10)

(13,162,414)

(14,231,322)

Net

280,947,796

248,470,227

47,965,561

38,642,361

Loans and advances to customers Neither past due nor impaired

Loans and advances to financial institutions Neither past due nor impaired (Note 8)

Performance... Built On A Heritage Of Community And Care! | PG 58


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Total Loans and advances Mortgages to customers

Overdrafts

Demand loans

Promissory notes

$

$

$

$

$

Grades 1. Pass 2. Special mention 3. Sub-standard 4. Doubtful 5. Loss

11,943,628 1,194,480 – – –

72,543,430 502,893 – – –

4,839,336 – – – –

82,329,564 1,177,509 – – –

171,655,958 2,874,882 – – –

Total

13,138,108

73,046,323

4,839,336

83,507,073

174,530,840

9,547,239 1,737,367 – – –

61,480,754 1,238,413 – – –

5,325,447 – – – –

70,038,928 1,147,814 – – –

146,392,368 4,123,594 – – –

11,284,606

62,719,167

5,325,447

71,186,742

150,515,962

December 31, 2009 Loans and advances to customers

December 31, 2008 Loans and advances to customers Grades 1. Pass 2. Special mention 3. Sub-standard 4. Doubtful 5. Loss Total

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 59


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Demand loans

Promissory notes

Mortgages

Total Loans and advances to customers

December 31, 2009 Past due up to 30 days Past due 30-60 days Past due 60-90 days Past due over 90 days

$

$

$

$

19,285,778 5,647,423 6,693,489 10,780,431

1,262,506 276,873 156,288 691,268

18,673,121 5,650,967 3,615,381 12,703,384

39,221,405 11,575,263 10,465,158 24,175,083

Total

42,407,121

2,386,935

40,642,853

85,436,909

Fair value of collateral

71,023,322

8,458,726

100,217,108

179,699,156

December 31, 2008 Past due up to 30 days Past due 30-60 days Past due 60-90 days Past due over 90 days

20,424,112 8,850,958 2,675,937 8,097,336

1,107,753 458,878 317,023 731,009

18,557,205 3,197,194 3,834,521 11,275,677

40,089,070 12,507,030 6,827,481 20,104,022

Total

40,048,343

2,614,663

36,864,597

79,527,603

Fair value of collateral

64,595,029

6,948,529

79,223,069

150,766,627

Individually impaired loans Grades: 1. Pass 2. Special mention 3. Sub-standard 4. Doubtful 5. Loss Total

2009 $

2008 $

663,964 2,576 16,397,033 9,907,686 7,171,202 34,142,461

2,146,463 439,447 12,568,058 9,943,439 7,560,577 32,657,984

Fair value of collateral

62,708,004

58,550,849

Performance... Built On A Heritage Of Community And Care! | PG 60


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Investment securities Treasury bills

Available-forsale

Held-to-maturity

Total

$

$

$

$

AA- to AA+

1,532,055

4,007,005

5,539,060

A- to A+

2,041,205

2,041,205

Lower than A-

Unrated

16,832,105

7,075,637

16,508,146

40,415,888

Total

16,832,105

8,607,692

22,556,356

47,996,153

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 61


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Government

Professional and other services

Personal

industries

Total

$

$

$

$

$

$

16,832,105

16,832,105

47,965,561

47,965,561

- Overdraft

479,981

1,084

4,333,498

4,266,220

4,846,630

13,927,413

- Demand loans

4,111,118

3,287,270

1,572,721

13,247,585

56,775,895

56,613,735

135,608,324

- Promissory notes

10,845

61,299

35,820

9,054,161

3,422,921

12,585,046

- Mortgages

296,278

2,115,371

6,988,523

102,709,721

19,879,534

131,989,427

7,628,258

4,656,904

12,285,162

10,902,788

11,550,080

103,488

22,556,356

958,267

951,494

1,909,761

As at December 31, 2009

67,454,874

4,898,222

5,465,024

29,954,906

24,605,426

172,805,997 90,474,706

395,659,155

As at December 31, 2008

55,708,177

4,251,979

4,146,340

31,369,462

30,291,301

153,727,088 76,560,982

356,055,329

Treasury bills Loans and advances to financial institutions

Financial institutions

Manufacturing

Tourism

$

$

Other

Loans and advances to customers:

Investment securities: - available-for-sale - held-to-maturity Other assets

Performance... Built On A Heritage Of Community And Care! | PG 62


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 63


ECD

CAD

EURO

USD

GBP

TTD

BD

TOTAL

28,420,137 2,104,008 16,832,105 47,965,561 280,947,796

59,487 156,398 – – –

236,457 213,903 – – –

458,930 2,261,256 – – –

64,940 1,182,590 – – –

– 15,734 – – –

67,694 42,731 – – –

29,307,645 5,976,620 16,832,105 47,965,561 280,947,796

Investment securities - available-for-sale - held-to-maturity Other assets

9,685,224 22,556,356 1,909,761

– – –

– – –

2,599,938 – –

– – –

– – –

– – –

12,285,162 22,556,356 1,909,761

Total financial assets

410,420,948

215,885

450,360

5,320,124

1,247,530

15,734

110,425

417,781,006

Liabilities Due to customers Other liabilities

363,920,948 3,832,385

– –

2,577 –

1,453,491 –

– –

– –

– –

365,377,016 3,832,385

Total financial liabilities

367,753,333

2,577

1,453,491

369,209,401

Net on-balance sheet positions

42,667,615

215,885

447,783

3,866,633

1,247,530

15,734

110,425

48,571,605

Credit commitments

28,894,623

28,894,623

365,153,690 331,856,979

165,493 –

1,255,352 2,516

8,146,849 1,314,693

964,682 –

198,617 –

236,241 –

376,120,924 333,174,188

Net on-balance sheet positions

33,296,711

165,493

1,252,836

6,832,156

964,682

198,617

236,241

42,946,736

Credit commitments

29,078,341

29,078,341

As at December 31, 2009 Assets Cash and balances with Central Bank Due from other banks Treasury bills Loans and advances to financial institutions Loans and advances to customers

As at December 31, 2008 Total financial assets Total financial liabilities


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Performance... Built On A Heritage Of Community And Care! | PG 66


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Up to 1 month

1-3 months

3-12 months

1-5 years

Over 5 years

Total

$

$

$

$

$

$

234,017,911

43,514,407

84,622,554

5,885,395

368,040,267

3,832,385

3,832,385

237,850,296

43,514,407

84,622,554

5,885,395

371,872,652

49,757,710

45,699,912

56,249,216

67,280,190

210,586,870

429,573,898

222,635,987

36,206,105

70,534,136

2,293,200

331,669,428

3,769,600

3,769,600

226,405,587

36,206,105

70,534,136

2,293,200

335,439,028

56,610,722

47,978,074

50,799,145

59,953,932

176,236,167

391,578,040

As at December 31, 2009

Liabilities Due to customers Other liabilities

Total liabilities (Contractual maturity dates) Assets held for managing liquidity risk (contractual maturity dates) As at December 31, 2008

Liabilities Due to customers Other liabilities Total liabilities (Contractual maturity dates) Assets held for managing liquidity risk (contractual maturity dates)

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 67


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

1 year $

1-5 years $

Over 5 years $

Total $

Loan commitments Guarantees, acceptances and other financial facilities

22,638,843 207,262

2,048,273 3,879,590

112,658

24,695,113 4,199,510

Total

22,846,105

5,927,863

120,655

28,894,623

15,965,251

9,400,678

5,196

25,371,125

3,707,216

–

–

3,707,216

19,672,467

9,400,678

5,196

29,078,341

As at December 31, 2009 7,997

As at December 31, 2008 Loan commitments Guarantees, acceptances and other financial facilities Total

Performance... Built On A Heritage Of Community And Care! | PG 68


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Carrying value

Fair value

2009 $

2008 $

2009 $

2008 $

47,965,561

38,642,361

47,965,561

38,642,361

280,947,796

248,470,227

286,801,939

250,853,265

13,918,905

11,557,424

13,872,273

11,454,871

126,920,339

113,270,801

130,848,499

116,203,033

11,254,777

8,418,705

8,288,869

9,050,392

128,853,775

115,223,297

133,792,298

114,144,969

22,556,356

22,171,742

22,247,917

22,171,136

Due to customers:

365,377,016

329,404,588

363,421,316

327,293,210

− Time deposits

143,041,123

120,722,596

141,085,423

118,611,218

− Savings accounts

187,915,027

173,451,589

187,915,027

173,451,589

− Demand accounts

34,420,866

35,230,403

34,420,866

35,230,403

Financial assets Loans and advances to financial institutions Loans and advances to customers: − Overdraft − Demand loans − Promissory notes − Mortgages Investment securities − Held to maturity Financial liabilities

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 69


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

December 31, 2009

Level 1 $

Level 2 $

Level 3 $

Total $

- Investment securities - debt

5,538,959

3,068,733

8,607,692

- Investment securities - equity

969,310

969,310

6,508,269

3,068,733

9,577,002

Available-for-sale financial assets

Total assets

Available-for-sale financial assets Debt securities $ At January 1, 2009

4,427,490

Settlements

(1,358,757)

Transfer into or out of Level 3 At December 31, 2009 Performance... Built On A Heritage Of Community And Care! | PG 70

– 3,068,733


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Reflected in equity Favourable changes

Unfavourable changes

$

$

77,894

18,864

At December 31, 2009

Available-for-sale financial assets

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 71


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

2009 $

2008 $

Share capital

7,971,454

7,971,454

Statutory reserve

7,971,454

7,971,454

Retained earnings

44,700,869

37,539,794

Total qualifying Tier 1 capital

60,643,777

53,482,702

Revaluation reserve – available-for-sale investments

620,920

493,761

Revaluation reserve – property, plant and equipment

4,939,400

2,262,730

Total qualifying Tier 2 capital

5,560,320

2,756,491

66,204,097

56,239,193

On-balance sheet

279,719,643

279,562,292

Off-balance sheet

5,778,925

5,815,668

285,498,568

285,377,960

Capital adequacy ratio

21%

19%

Basel ratio

23%

20%

Tier 1 capital

Tier 2 capital

Total regulatory capital

Risk-weighted assets:

Total risk-weighted assets

Performance... Built On A Heritage Of Community And Care! | PG 72


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 73


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars) 2009 $

2008 $

Cash in hand Balances with Central Bank other than mandatory reserve deposits

6,659,391 955,824

7,991,839 1,773,157

Included in cash and cash equivalents (Note 28)

7,615,215

9,764,996

21,692,430

19,443,570

29,307,645

29,208,566

Mandatory reserve deposits with Central Bank

2009 $

2008 $

Items in the course of collection from other banks

1,411,193

566,838

Placements with other banks

4,565,427

4,521,513

Included in cash and cash equivalents (Note 28)

5,976,620

5,088,351

Treasury bills

Performance... Built On A Heritage Of Community And Care! | PG 74

2009 $

2008 $

16,832,105

17,910,470


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Overdraft Demand loans Promissory notes Mortgages

Less provision for impairment of loans and advances (Note 10)

Current Non-current

2009 $

2008 $

13,927,413 135,608,324 12,585,046 131,989,427

11,566,613 122,976,186 9,878,217 118,280,533

294,110,210

262,701,549

(13,162,414)

(14,231,322)

280,947,796

248,470,227

20,168,920 260,778,876

23,519,169 224,951,058

280,947,796

248,470,227

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 75


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Overdraft

Demand loans

Promissory notes

Mortgage

Total

$

$

$

$

$

Balance at January 1, 2009 Provision for loan impairment Loans written off during the year

9,189 (681) –

9,705,385 879,742 (1,897,142)

1,459,512 (44,535) (84,708)

3,057,236 743,245 (664,829)

14,231,322 1,577,771 (2,646,679)

At December 31, 2009

8,508

8,687,985

1,330,269

3,135,652

13,162,414

15,847 – (6,658)

7,933,289 1,789,642 (17,546)

955,695 525,379 (21,562)

4,158,071 (1,066,990) (33,845)

13,062,902 1,248,031 (79,611)

9,189

9,705,385

1,459,512

3,057,236

14,231,322

Balance at January 1, 2008 Provision for loan impairment Loans written off during the year At December 31, 2008

2009 $

2008 $

969,310 2,708,160

912,500 2,445,280

5,538,959 3,068,733

5,004,192 4,427,490

Total securities: available-for-sale

12,285,162

12,789,462

Held-to-maturity Debt securities - at amortised cost: - Listed - Unlisted

10,253,291 12,303,065

10,078,086 12,093,656

Total securities: held-to-maturity

22,556,356

22,171,742

Current Non-current

12,678,642 22,162,876

23,482,498 8,120,926

34,841,518

31,603,424

Available-for-sale Equity securities - Listed - Unlisted Debt securities: - Listed - Unlisted

Performance... Built On A Heritage Of Community And Care! | PG 76


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Available for sale $

Held to maturity $

12,789,462

22,171,742

2,009,708

23,160,649

Disposals (sale and redemption)

(2,570,820)

(22,776,035)

Gains from changes in fair value

56,812

–

At December 31, 2009

12,285,162

22,556,356

At January 1, 2008

10,625,141

19,276,037

7,490,432

37,546,945

(5,130,832)

(34,651,240)

At January 1, 2009 Additions

Additions Disposals (sale and redemption) Losses from changes in fair value

At December 31, 2008

(195,279)

–

12,789,462

22,171,742

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 77


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars) Land and Building

Furniture and Fixtures

Equipment

Motor Vehicles

Total

$

$

$

$

$

December 31, 2007 Cost or valuation Accumulated depreciation

10,771,211 (1,882,179)

1,248,533 (842,842)

8,624,359 (6,357,562)

186,920 (65,257)

20,831,023 (9,147,840)

8,889,032

405,691

2,266,797

121,663

11,683,183

Opening net book amount Additions in the year Depreciation charge (Note 22)

8,889,032 24,510 (156,244)

405,691 40,258 (43,363)

2,266,797 1,560,598 (610,155)

121,663 – (24,332)

11,683,183 1,625,366 (834,094)

Closing net book amount

8,757,298

402,586

3,217,240

97,331

12,474,455

10,795,721 (2,038,423)

1,288,791 (886,205)

8,757,298

8,757,298 2,723,259 398,934 (242,112)

Net book amount Year ended December 31, 2008

At December 31, 2008 Cost or valuation Accumulated depreciation

10,184,957 (6,967,717)

186,920 (89,589)

22,456,389 (9,981,934)

402,586

3,217,240

97,331

12,474,455

402,586 – 55,475 (43,418)

3,217,240 – 747,245 (763,211)

97,331 – – (19,466)

12,474,455 2,723,259 1,201,654 (1,068,207)

11,637,379

414,643

3,201,274

77,865

15,331,161

Cost or valuation Accumulated depreciation

12,083,652 (446,273)

1,344,266 (929,623)

10,932,202 (7,730,928)

186,920 (109,055)

24,547,040 (9,215,879)

Net book amount

11,637,379

414,643

3,201,274

77,865

15,331,161

Net book amount Year ended December 31, 2009 Opening net book amount Revaluation Additions in the year Depreciation charge (Note 22) Closing net book amount At December 31, 2009

Performance... Built On A Heritage Of Community And Care! | PG 78


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars) 2009 $

2008 $

Cost Accumulated depreciation based on historical cost

8,044,398 (1,709,253)

8,044,398 (1,608,309)

Depreciated historical cost

6,335,145

6,436,089

2009 $

2008 $

1,909,761 174,051 837,018

1,839,745 156,800 350,483

2,920,830

2,347,028

2009 $

2008 $

143,041,123 187,915,027 34,420,866

120,722,596 173,451,589 35,230,403

365,377,016

329,404,588

362,325,478 3,051,538

327,327,458 2,077,130

365,377,016

329,404,588

Accounts receivable Inventories of stationery and supplies Prepayments

Time deposits Savings accounts Demand amounts

Current Non-current

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 79


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars) 2009 $

2008 $

773,237 2,680,038 379,110

1,242,654 2,199,478 327,468

3,832,385

3,769,600

2009 $ 2,704,000 (2,961,000)

2008 $ 2,378,000 (2,613,000)

Unrecognised actuarial loss

(257,000) 916,000

(235,000) 974,000

Liability in the balance sheet

659,000

739,000

2009 $

2008 $

Manager’s cheques outstanding Accounts payable and accrued expenses Dividends payable on ordinary shares

Present value of funded obligations Fair value of plan assets

At beginning of year Current service cost Interest cost Members’ contributions Actuarial loss/(gain) Benefits paid

2,378,000 123,000 166,000 41,000 13,000 (17,000)

2,536,000 139,000 152,000 36,000 (468,000) (17,000)

At end of year

2,704,000

2,378,000

Performance... Built On A Heritage Of Community And Care! | PG 80


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars) 2009 $

2008 $

At beginning of year Expected return on plan assets Actuarial gain Bank’s contributions Members’ contributions Benefits paid

2,613,000 188,000 3,000 133,000 41,000 (17,000)

2,253,000 139,000 75,000 127,000 36,000 (17,000)

At end of year

2,961,000

2,613,000

2009 $

2008 $

Current service cost Interest cost Net actuarial gains recognised in the year Expected return on plan assets Total included in staff costs (Note 24)

At beginning of year Pension expense Contributions paid At end of year

Discount rate Expected return on plan assets Future salary increases Future pension increases

123,000 166,000 (188,000) (48,000)

139,000 152,000 (13,000) (139,000)

53,000

139,000

2009 $

2008 $

739,000 53,000 (133,000)

727,000 139,000 (127,000)

659,000

739,000

2009 %

2008 %

7 7 5.5 –

7 7 5.5 – 1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 81


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars) 2009 % Debt securities Others

86 14

86 14

100

100

2009 $ Defined benefit obligation Fair value of plan assets (Surplus)/deficit in the plan

Experience adjustment on plan liabilities Experience adjustment on plan assets

2008 %

2008 $

2007 $

2005 $

2,704,000 (2,961,000)

2,378,000 (2,613,000)

2,536,000 (2,253,000)

2,219,000 (1,993,000)

2,063,000 (1,788,000)

(257,000)

(235,000)

283,000

226,000

275,000

13,000 3,000

(43,000) 75,000

29,000 (11,000)

(87,000) (21,000)

(129,000) (51,000)

2009 $

2008 $

At beginning of year Statement of income (recovery)/charge for the year (Note 25)

(30,846) (187,348)

(165,691) 134,845

Deferred tax asset at end of year

(218,194)

(30,846)

Performance... Built On A Heritage Of Community And Care! | PG 82

2006 $


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Accelerated capital allowances Retirement defined obligation

Deferred tax asset at income tax rate of 30%

2009 $

2008 $

(68,312) (659,000)

(102,820) –

(727,312)

(102,820)

(218,194)

(30,846)

No. of Shares

2009 $

No. of Shares

2008 $

4,999,966

7,971,454

4,999,966

7,971,454

Authorized: 5,000,000 ordinary shares At beginning and end of year

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 83


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

Interest and similar income Loans and advances Deposits with banks Investment securities

Interest expense and similar charges Time deposits Savings deposits Demand deposits

Net interest income

Foreign exchange Commission income Fees income Rental income Dividend income Gain on investment securities

Staff costs (Note 24) Administrative expenses (Note 23) Depreciation (Note 12) Operating lease rental

Performance... Built On A Heritage Of Community And Care! | PG 84

2009 $

2008 $

24,805,756 10,429 5,770,984

24,427,048 66,603 5,187,115

30,587,169

29,680,766

5,841,078 6,003,044 38,910

5,229,080 5,487,550 46,206

11,883,032

10,762,836

18,704,137

18,917,930

2009 $

2008 $

2,552,754 1,678,946 356,705 140,000 81,630 56,074

1,747,447 1,531,602 306,491 420,000 50,810 –

4,866,109

4,056,350

2009 $

2008 $

5,172,593 4,930,604 1,068,207 450,497

5,218,223 4,247,674 834,094 214,726

11,621,901

10,514,717


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars) 2009 $

2008 $

Advertising Other operating expenses Postage, telephone and telexes Audit and professional fees Equipment expenses Utilities Security expenses Directors’ fees and expenses Insurance Repairs and maintenance Stationery Bank licence Rates and taxes Legal fees

947,426 702,357 693,762 553,559 426,701 369,748 306,795 269,408 214,437 143,772 139,744 120,000 35,125 7,770

452,002 651,888 634,408 546,506 291,304 438,276 348,847 138,712 192,143 261,589 137,484 120,000 15,625 18,890

Total administrative expenses

4,930,604

4,247,674

Salaries and wages Other employee benefits Profit sharing Social security costs Pension costs (Note 16)

2009 $

2008 $

4,020,234 570,378 363,266 165,715 53,000

3,774,844 634,953 511,717 157,709 139,000

5,172,593

5,218,223

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 85


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars) 2009 $

2008 $

1,443,450 – (187,348)

1,861,115 120,006 134,845

1,256,102

2,115,966

2009 $

2008 $

Profit before income tax

10,370,574

11,211,532

Tax calculated at the statutory tax rate of 30% Tax effect of exempt income Tax effect of expenses not deductible for tax purposes Tax under accrued in prior years Deferred tax under accrued in the prior year

3,111,172 (1,727,011) 69,641 – (197,700)

3,363,460 (1,411,583) 44,083 120,006 –

1,256,102

2,115,966

Current tax Tax under accrued in prior years Deferred tax (Note 17)

Performance... Built On A Heritage Of Community And Care! | PG 86


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars) 2009 $

2008 $

7,615,215 5,976,620

9,764,996 5,088,351

13,591,835

14,853,347

2009 $

2008 $

Loans outstanding at beginning of year Net loans issued/(repaid) for the year

2,992,329 45,496

3,112,842 (120,513)

Loans outstanding at end of year

3,037,825

2,992,329

252,829

237,312

2009 $

2008 $

Deposits at beginning of year Net deposits received/(repaid) during the year

709,978 1,514,651

920,046 (210,068)

Deposits outstanding at end of year

2,224,629

709,978

30,753

23,201

Cash and balances with Central Bank (Note 5) Due from other banks (Note 6)

Interest income earned Deposits from Directors and other key management personnel

Interest expense on deposits

1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 87


Notes to Financial Statements | December 31, 2009 | (expressed in Eastern Caribbean dollars)

2009 $

2008 $

Salaries and other short-term benefits

837,268

744,228

Post and other employment benefits

146,573

159,396

983,841

903,624

2009 $

2008 $

24,695,113 3,992,248 11,832 195,430

25,371,125 3,707,216 – –

28,894,623

29,078,341

Loan commitments Guarantees and standby letters of credit Acceptances Documentary and commercial letters of credit

Performance... Built On A Heritage Of Community And Care! | PG 88


1ST NATIONAL BANK | ANNUAL REPORT 2009 | PG 41

1st National Bank Annual Report

2009

1st National Bank St. Lucia Limited P.O. Box 168 #21 Bridge Street Castries St. Lucia Tel: +758 455 7000 Fax: + 758 453 1630 Email: manager@1st nationalbankslu.com Website: www.1stnationalbankonline.com

Annual Report 2009  

Annual Report 2009

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