The Annual General Meeting of the Blues and Twos Credit Union was held at 2pm on Tuesday 8th December 2009 in the Bradley Room at Lancashire Police Headquarters.
CHAIR DESCRIBES “DIFFICULT” YEAR
Maggie Roberts, Chair of the Board of Directors, told the Annual General Meeting on 8th December that the past twelve months had been “difficult in financial terms” and that the so called credit crunch had affected everyone. In many cases, the credit union had been able to assist members who found themselves in difficulty but the important thing was to “tell us – we can’t help you if you leave it too late”.
Mrs Roberts went on to thank the administration staff who she said had met the year’s challenges by streamlining procedures, realigning office responsibilities and using the new document scanning system to free up time. To maximise our efforts, plans have been made to recruit a dedicated Marketing officer next year.
Net membership now stood at over 4300 with greater emphasis being placed on marketing within the County Council via electronic mail systems, road shows held at various locations and of course, maintaining the County Hall office. The Chief Executive, Ged Fitzgerald, was thanked for his continuing support.
The Chair made special mention of the Blues and Twos Society, who this year donated over £19,000 raised from their lottery, and the Board of Directors, who continue to give of their time and expertise for the benefit of the credit union.
Looking to the future, she said that our priorities continue to be to grow the business, increase turnover and provide a healthy dividend on savings.
Lastly but certainly not least, the Chair said that the entire Board of Directors and the staff of the credit union would like to thank all members for their continued support and loyalty with a promise that we will always seek to provide you with the best financial services possible.
TREASURER RECOMMENDS 3.2% GROSS DIVIDEND
The Treasurer of the Blues and Twos told the Annual General Meeting that despite the repercussions of the so called credit crunch being experienced nationwide, the credit union had managed some of the financial difficulties emerging locally by providing a viable alternative for its members.
In describing the year’s positive performance, Bill Roberts said that Turnover, Shareholder Funds and the transfer to General Reserve had all gone up.
Total income (turnover) had risen by over £21,000 although interest on members’ savings held at the bank had fallen for the third year running. This particular source of our income would probably continue to fall despite all efforts. Total Shareholders Funds, comprising members’ savings balances and the General Reserve, had increased by a colossal £1.2 million due to extremely high levels of shareholder deposits over the past 12 months. This was, it is felt, as a direct result of the generous dividend announced 12 months ago, just when the credit crunch was beginning to bite and other investment rates were plummeting. Consequently, the credit union now has more than enough cash to service any lending requirements of members who appear reluctant to borrow in the current climate. In this situation, any shortfall in loan interest must be made up by investing savings at the best rate obtainable. It also means that the more shareholder funds we have, the further the amount available for a dividend payment must be spread. In effect, the only logical solution is to increase the number of loans to members. The Transfer to General Reserve was increased by nearly £34,000.
Dealing with Expenditure, Mr Roberts said that Administration Expenses which include everything from wages to bank charges, from computers to pencils, had increased by £55,000. Price rises of services and consumables, over which the credit union has no control, had been kept to a minimum by good housekeeping. By careful monitoring, Staff Salaries and Pensions had increased by only £1200.
However, the main increase within this heading was in respect of the Provision for Bad Debt which was up by £50,800. Despite this amount, the Treasurer said that the increase should be seen in the context of the current financial environment. The credit union will always try to give practical assistance to borrowing members in financial difficulty whenever possible and this can involve re-financing loans or temporarily accepting reduced repayments. However, there are occasions when there is little or nothing that can be done and the outstanding loan becomes subject to a bankruptcy or IVA. Under FSA rules, all loans which fall into these categories or are likely to do so must be provided for in our accounts and, in effect, taken out of the operating surplus. Mr Roberts reassured the meeting that policies and procedures for ensuring members are capable of repaying loans would be kept under constant review.
To summarise, the Treasurer said that although the overall operating surplus had been reduced by £36,000 - mainly as a results of the debt provision - the credit union had had another successful year. Our accountants have described our business growth of between 8% and 10% per year as an excellent result.
The constant challenge for the credit union is to encourage the membership to save and borrow in a financially prudent way. This is done by supplying low cost loans at the lower end of the market, helping existing borrowers who may experience financial difficulties and providing a safe haven for members’ spare cash which attracts a reasonable dividend.
In conclusion, Mr Roberts said that the figure available for distribution as Dividend amounted to £133,890 and that he was pleased to recommend the payment of a 3.2% gross dividend on all savings for the year ended 30 September 2009.
The recommendation was proposed, seconded and received unanimous approval. THIS DIVIDEND HAS NOW BEEN POSTED TO ALL SHARE(SAVINGS) ACCOUNTS
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04 September 2010
