Credit union rule limits dividends payment
C&WJ Cooperative Credit Union (C&WJCCUL) indicates that dividends paid out to shareholders are limited by sector rules.
In its 2019 annual report, which was released on August 5, 2020, the credit union said it made a surplus of $347 million for the year, representing an increase of 239.6 per cent when compared to the $102 million outturn in 2018.
The distributable surplus at December 31, 2019 was $364.9 million, but rules say that most of this must go towards statutory reserves.
The directors explained in the annual report, that in keeping with Article XIV Rule 73 and Article XV Rule 74, the company transferred $314.17 million of this surplus to statutory reserves.
Afterwards the amount available for distribution at this meeting is $50.7 million.
C&WJCCUL, which listed its preference shares on the Jamaica Stock Exchange last week, became first company of its kind to join the Exchange.
The annual report indicates that in 2019 it remained the largest credit union in Jamaica based on total assets and controlling market share of over 14 per cent of the movement’s savings.
Total assets increased to $17.75 billion in 2019, up from $16 billion the year before. Total assets within the credit union movement is estimated at $98 billion.
CWJ President Condell Stephenson indicated that at December 2019, the credit union’s delinquency ratio was at 2.99 per cent, the lowest in its recent past.
This ratio increased to seven per cent at December 2018 as a consequence of the merger with St Elizabeth CCU.
The credit union has however successfully reduced this ratio, and within a year has already brought it in line with the PEARLS Ratio requirement of less than five per cent.