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TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD
Notes to Financial Statements, continued Year ended March 31, 2013
8. Notes receivable – net
(a) TCI Bank loan, continued
On April 30, 2013 the liquidator of TCI Bank proposed to pay a rate of 8% interest on the debenture compounded every six months from the date of default until August 20, 2012, being the date the liquidator repaid the debenture, less US$300,000 unpaid liquidator’s costs and expenses incurred in relation to the debenture (note 21). On May 30, 2013 the Board of Directors of NIB agreed to the liquidator’s proposal which was formally agreed on June 18, 2013.
The agreement specified the following conditions:
(i) TCI Bank shall pay to NIB in full and final settlement of its claim for interest and costs payable under the debenture, the sum of US$822,695 (the “Settlement Amount”) within fourteen days from June 18, 2013, being the date of the agreement;
(ii) The Settlement Amount recognises a credit of US$300,000 claimed by the liquidator in respect of the liquidator’s costs in collecting sufficient of the book debt of TCI Bank so as to repay the liability of TCI Bank to NIB under the debenture; and
(iii) On payment of the Settlement Amount:
 TCI Bank and the liquidator shall be released from all claims and demands by NIB in respect of the debenture;
 NIB shall be released in respect of any claims and demands by TCI Bank and/or the liquidator in respect of collection of the book debt of the Bank; and
 The legal proceedings shall be withdrawn by consent with no order as to costs.
During the year NIB recognised US$946,373 of interest on the debenture loan which was included as part of interest and other income in the statement of income, expenses and reserve.
At March 31, 2013 the total unpaid interest on the debenture loan was US$1,044,695 (note 6). This unpaid interest was subsequently collected on June 18, 2013, net of the aforementioned US$300,000 liquidator’s cost and expenses of collection and US$78,000 legal fees incurred by NIB.
54 | The National Insurance Board of The Turks and Caicos Islands
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