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Notes to the Financial Statements

For the year ended September 30, 2025. Expressed in Thousands of Eastern Caribbean dollars ($’000), except where otherwise stated.

2 Material accounting policies (continued)
2.5 Summary of material accounting policies (continued)
l Premises and equipment (continued)

The depreciation rates used are as follows:

Freehold premises 1.3% – 2.0%
Vehicles and equipment 12.5% – 25.0%
(computers, software, servers, other hardware, etc.)
Furniture and fittings 1.7% – 10.0%

m Impairment of non-financial assets
Further disclosures relating to impairment of non-financial assets are also provided in the following notes:
• Disclosures for significant assumptions (Note 3)
• Premises and equipment (Note 6)
• Intangible assets (Note 8)

The Bank assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any
indication exists, or when annual impairment testing for an asset is required, the Bank estimates the asset’s
recoverable amount. An asset’s recoverable amount is the higher of an asset’s or Cash-Generating Unit’s (CGU) fair
value less costs of disposal and its value in use. The recoverable amount is determined for an individual asset, unless
the asset does not generate cash inflows that are largely independent of those from other assets or group of assets.
When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and
is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows available to shareholders are discounted to their present
value using a pre-tax discount rate that reflects current market assessments of the time value of money and the
risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into
account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are
corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value
indicators.

For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an
indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists,
the Bank estimates the asset’s or CGU’s recoverable amount.

n Business combinations and goodwill
The Bank uses the purchase method of accounting to account for acquisitions. The cost of an acquisition is measured
as the aggregate of the consideration transferred, measured at acquisition date fair value and the amount of any non-
controlling interests in the acquiree. For each business combination, the Bank elects to measure the non-controlling
interests in the acquiree at the proportionate share of the acquiree’s identifiable net assets. Acquisition-related costs
are expensed as incurred.

If the business combination is achieved in stages, any previously held equity interest is remeasured at its acquisition
date fair value and any resulting gain or loss is recognised in the Statement of income.