Page 9 - CMB

Diahuebs, 15 April 2021 AWEMainta 9

Consolidated Financial Highlights

Consolidated balance sheet of Maduro & Curiel’s Bank N.V. Consolidated income statement of Maduro & Curiel’s Bank N.V. Explanatory notes to the Consolidated Financial Highlights as at December 31, 2020
and its subsidiaries as at December 31, 2020 and its subsidiaries for the year ended December 31, 2020
A. ACCOUNTING POLICIES B. SPECIFICATION OF ACCOUNTS
(All amounts are expressed in thousands of Antillean Guilders) 2020 2019 (All amounts are expressed in thousands of Antillean Guilders) 2020 2019 1. GENERAL - Amortized cost: (All amounts are expressed in thousands of Antillean Guilders) 2020 2019 www.mcb-bank.com
ASSETS The principal accounting policies adopted Assets that are held for collection of I ASSETS
Cash and due from banks 2,851,439 2,625,990 Interest income 287,095 317,180 in the preparation of the Consolidated contractual cash flows where those Investment securities
Investment securities 880,607 772,370 Interest expense 15,352 15,374 Financial Highlights of Maduro & Curiel’s cash flows represent solely payments of Debt securities at amortized cost 868,846 762,807
Bank N.V. and its subsidiaries (the ‘Group’)
principal and interest (‘SPPI’), and that
Loans and advances to customers 4,267,905 4,218,613 are set out below. These explanatory notes are not designated at Fair Value Trough Financial assets at fair value through profit or loss 8,176 6,494
Customers' liability under acceptances 1,506 1,487 Net interest income 271,743 301,806 are an extract of the detailed notes included Profit or loss (FVTPL), are measured at Total investment securities 877,022 769,301
Other assets 47,286 39,009 in the consolidated financial statements amortized cost. The carrying amount of Accrued interest receivables on debt securities 4,265 4,229
and are consistent in all material respects
these assets is adjusted by any expected
Bank premises, equipment and 194,894 198,462 Fee and commission income 184,926 242,915 with those from which they have been credit loss allowance as further Less: allowance for expected credit loss (680) (1,160)
right-to-use assets Fee and commission expenses 75,352 99,312 derived. described below. Interest income from
Deferred tax assets 10,169 6,883 2. BASIS OF PREPARATION these financial assets is included in NET INVESTMENTS 880,607 772,370
‘Interest income’ using the effective
Net fee and commission income 109,574 143,603 The consolidated financial statements, interest rate method.
TOTAL ASSETS 8,253,806 7,862,814 from which the Consolidated Financial Loans and advances to customers
Highlights have been derived, are prepared - Fair value through profit or loss Retail customers 1,700,614 1,605,815
Income from foreign exchange transactions 41,267 52,512 in accordance with International Financial (“FVTPL”):
LIABILITIES AND EQUITY Reporting Standards (‘IFRS’). Assets that do not meet the criteria Corporate customers 2,486,312 2,505,801
Liabilities Other operating income 15,959 976 for amortized cost are measured at fair Public sector 203,745 162,713
Customers' deposits 7,008,245 6,603,939 The figures presented in these highlights value through profit or loss. These assets Other 46,286 44,317
Due to banks 15,616 28,306 Operating income 438,543 498,897 are stated in thousands of Antillean are unquoted equity securities that are Total loans and advances to customers 4,436,957 4,318,646
Guilders and are rounded to the nearest
not held for trading purposes. A gain
Acceptances outstanding 1,506 1,487 thousand. or loss on such an equity investment Accrued interest receivable on loans and advances 11,563 11,207
Profit tax liabilities 15,936 (3,150) Salaries and other employee expenses 146,521 207,693 is subsequently measured at fair value Less: allowance for expected credit loss (180,615) (111,240)
Lease liabilities 13,398 9,989 Occupancy expenses 35,414 27,673 The accounting policies used have been through profit or loss. Interest income
from these financial assets is included
consistently applied by the Bank and are
Other liabilities 105,246 144,950 Credit loss expenses on financial assets and 86,704 7,376 consistent, in all material respects, with in ‘Interest income’ using the effective NET LOANS AND ADVANCES TO CUSTOMERS 4,267,905 4,218,613
Provisions 77,241 149,943 contingent liabilities those used in the previous year. interest rate method.
Deferred tax liability 16,682 21,679 Other operating expenses 72,264 83,120 II LIABILITIES
The statements have been prepared Business model assessment
on the historical cost basis except for The business model reflects how the Customers' deposits
7,253,870 6,957,143 Operating expenses 340,903 325,862 financial assets at fair value through Group manages the assets in order to Retail customers 2,770,049 2,561,911
Equity profit or loss, and financial assets that are generate cash flows. That is, whether Corporate customers 2,756,525 2,754,514
the Group’s objective is solely to collect
measured at amortized cost. Historical
Share capital 51,000 51,000 Net result before tax 97,640 173,035 cost is generally based on the fair value the contractual cash flows from the Other 1,478,390 1,281,829
General reserve 12,500 12,500 Profit tax 14,249 25,524 of the consideration given in exchange for assets. If this condition is not applicable 7,004,964 6,598,254
Other reserves 199,092 192,844 goods and services. (unlisted equity securities), then the
Retained earnings 737,344 649,327 3. BASIS OF CONSOLIDATION financial assets are classified as part of Accrued interest payable on customers' deposits 3,281 5,685
‘other’ business model and measured at
999,936 905,671 Subsidiaries are all entities over which FVTPL.
the Group has the power to govern the TOTAL CUSTOMERS' DEPOSITS 7,008,245 6,603,939
financial and operating policies, generally SPPI
TOTAL LIABILITIES AND EQUITY 8,253,806 7,862,814 NET RESULT AFTER TAX 83,391 147,511
accompanying a shareholding of more than Where the business model is to hold
one half of the voting rights. Subsidiaries assets to collect contractual cash
are fully consolidated from the date on flows, the Group assesses whether
which control is transferred to the Group the financial instruments’ cash flows Expected credit loss principles - The Exposure at Default (EAD) is an
Independent auditor’s report on the audit of the consolidated financial highlights until the date that control ceases. represent solely payments of principal and Based on IFRS 9 the financials assets and estimate of the exposure at a future
interest (the ‘SPPI test’). In making this loan commitments (‘financial assets’) are default date, taking into account expected
Opinion conclusion thereon. The following subsidiaries have been assessment, the Group considers whether grouped into Stage 1, Stage 2 and Stage 3 as changes in the exposure after the
The accompanying consolidated financial highlights, which comprise the consolidated In connection with our audit of the consolidated financial statements, our consolidated as of December 31, 2020: the contractual cash flows are consistent described below: reporting date, including repayments of
balance sheet as at 31 December 2020 and consolidated income statement for responsibility is to read the other information and, in doing so, consider whether - Caribbean Mercantile Bank N.V. and with a basic lending arrangement i.e. - Stage 1: When financial assets are first principal and interest, whether scheduled
the year then ended and related notes, are derived from the audited consolidated the other information is materially inconsistent with the consolidated financial subsidiary interest includes only consideration for recognized, the Group recognizes an by contract or otherwise, expected
financial statements of Maduro & Curiel’s Bank N.V. (“the Bank”) for the year ended statements or our knowledge obtained in the audit or otherwise appears to be - The Windward Islands Bank Ltd. the time value of money, credit risk, other allowance based on twelve months’ drawdowns on committed facilities, and
31 December 2020. materially misstated, as is required by article 121 sub 3 Book 2 of the Curaçao Civil - Maduro & Curiel’s Bank (Bonaire) N.V. basic lending risks and a profit margin ECLs. Stage 1 financial assets also include accrued interest from missed payments.
Code. If, based on the work we have performed, we conclude that there is a material and subsidiary that is consistent with a basic lending facilities where the credit risk has - The Loss Given Default (LGD) is an
In our opinion, the accompanying consolidated financial highlights are consistent, misstatement of this other information, we are required to report that fact. We have - Maduro & Curiel’s Insurance Services N.V. arrangement. Where the contractual terms improved and the financial asset has been estimate of the loss arising in the case
in all material respects, with the audited consolidated financial statements of the nothing to report in this regard. - MCB Risk Insurance N.V. introduce exposure to risk or volatility reclassified from Stage 2. where a default occurs at a given time. It
Bank, in accordance with the Provisions for the Disclosure of Consolidated Financial - MCB Group Insurance N.V. that are inconsistent with a basic lending - Stage 2: When a financial asset has is based on the difference between the
Highlights of Domestic Banking Institutions, as set by the Central Bank of Curaçao Responsibilities of management for the consolidated financial highlights - MCB Securities Holding B.V. arrangement, the related financial asset is shown a significant increase in credit risk contractual cash flows due and those
and Sint Maarten (“CBCS”). Management is responsible for the preparation of the accompanying consolidated - MCB Securities Administration N.V. classified and measured at FVTPL. since origination, the Group records an that the lender would expect to receive,
financial highlights in accordance with the Provisions for the Disclosure of - Progress N.V. allowance for these Lifetime ECLs. Stage including from the realization of any
Consolidated financial highlights Consolidated Financial Highlights of Domestic Banking Institutions, as set by the - MCB Holding International VBA and Derecognition of financial assets 2 financial assets also include facilities, collateral. It is expressed as a percentage
The accompanying consolidated financial highlights do not contain all the disclosures CBCS. subsidiaries The Group sometimes renegotiates or where the credit risk has improved and of the EAD.
required by International Financial Reporting Standards. Reading the accompanying otherwise modifies the contractual cash the financial asset has been reclassified
consolidated financial highlights and our report thereon, therefore, is not a substitute Auditor’s responsibilities 4. CLASSIFICATION AND SUBSEQUENT flows of loans to customers. When this from Stage 3. In its ECL models, the Group relies on a
for reading the audited consolidated financial statements of the Bank and our Our responsibility is to express an opinion on whether the accompanying consolidated MEASUREMENT OF FINANCIAL ASSETS happens, the Group assesses whether - Stage 3: Financial assets considered broad range of forward looking information
auditor’s report thereon. financial highlights are consistent, in all material respects, with the audited Classification and subsequent or not the new terms are substantially credit-impaired and the Group records an as economic inputs such as GDP growth,
consolidated financial statements of the Bank based on our procedures, which were measurement of the financial assets different to the original terms. If the allowance for these Lifetime ECLs. Unemployment rates and the Consumer
The audited consolidated financial statements and our auditor’s report thereon conducted in accordance with International Standard on Auditing (ISA) 810 (Revised), depend on: terms are substantially different, the Price Index. The inputs and models used for
We expressed an unmodified audit opinion on the consolidated financial statements Engagements to Report on Summary Financial Statements. (i) the Group’s business model for Group derecognizes the original financial Calculation of Expected credit losses calculating ECLs may not always capture
2020 of the Bank in our auditor’s report dated 23 March 2021. managing the asset; and asset and recognizes a ‘new’ asset and The key elements of the ECL calculations all characteristics of the market at the
Curaçao, 14 April 2021 (ii) the cash flow characteristics of the recalculates a new effective interest rate are as follows: date of the financial statements. To reflect
Other information asset. for the asset. - The Probability of Default (PD) is an this, qualitative adjustments or overlays
Other information consists of the Management’s Report. Management is responsible for Ernst & Young Accountants estimate of the likelihood of default are occasionally made as temporary
for the other information. Our opinion on the consolidated financial statements Based on these factors, the Group classifies Financial assets are derecognized when over a given time horizon. A default may adjustments when such differences are
does not cover the other information and we do not express any form of assurance drs. R.J.W. van Nimwegen RA its debt instruments into one of the the rights to receive cash flows from the only happen at a certain time over the significantly material.
following two measurement categories: investments have expired. assessed period.