ECCB 2014-2015 Annual Report and Statement of Accounts

EASTERN CARIBBEAN CENTRAL BANK

Eastern Caribbean Central Bank Notes to Consolidated Financial Statements March 31, 2015 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (expressed in Eastern Caribbean dollars) March 31, 2015 3. Financial risk management … continued f) Fair value …continued Fair Value Hierarchy …continued The following table presents the Bank’s financial assets and liabilities that are mea sured at fair value at March 31, 2014: Level 1 Level 3 $ $ Financial assets Commercial paper 295,985,184 – Financial assets held for trading 1,388,227 – Available-for-sale – foreign investment securities 2,287,942,394 – Available-for-sale – domestic investment securities – 421,686 2,585,315,805 421,686 3. Financial risk manageme … continued f) Fair value …continued Fair Value Hierarchy …continued The following table pres nts the Ba k’s fin ncial ssets and liabilities that are mea sured at fair value at March 31, 2014: Level 1 Level 3 $ $ Fin ncial assets Commercial paper 295,985,184 – Fin ncial assets held for trading 1,388,227 – Available-for-sal – foreign investment s curities 2, 87,942,394 – Available-for-sale – domestic investment s curities – 421,686 2, 85,315,805 421,686 Financial risk management …continued f) Fair value …continued air Value Hierarchy ...continued The following table presents the Bank’s financial assets and liabilities that are measured at fair value at March 31, 2014: Eastern Caribbea Centr l Bank N tes to Consolidated F nancial Statements March 31, 2015 (expressed in Eastern C ribbe n dollars) 3. (expressed in Eastern Caribbean dollars)

Level 1

Level 1

Level 3

Level 3

$

$

$

$

Financial liabilities Financial liabilities held for trading

Financial liabilities Financ al liabilities held for trading

4,207,943

4,207,943

-

-

g) Capital risk management

g) Capital risk management The Bank’s objectives when managing capital are : The Bank’s objectives when managing capital are:

g) Capital risk management The Bank’s objectives when managing c pital are :

 Safeguard the Bank’s ability to continue as a going concern  Manage and safeguard the value of the Eastern Caribbean currency  Maintain a strong capital base to support its developmental activities  Safeguard the Bank’s ability to continue as a g ing concern  M age and safeguard the valu of the Eastern Caribbean urrency  Maintain a strong capital base t support its dev lopmental activities — — Safeguard the Bank’s ability to continue as a going concern — — Manage and safeguard the value of the Eastern Caribbean currency — — Maintain a strong capital base to support its developmental activities

The Bank manages capital through the maintenance of a general reserve according to prescribed guidelines as mandated in the ECCB Agreement Act 1983 (note 2t). As at March 31, 2015 the general reserve was $114,891,311 (2014: $126,926,236). The B nk man ges capital through the maintenance of a general reserve according to prescribed guidelines as manda ed in the ECCB Agreement Act 1983 (note 2t). As at March 31, 2015 the general reserve was $ 14,891,3 1 (2014: $126,926,236). The Bank manages capital through the maintenance of a general reserve according to prescribed guidelines as mandated in the ECCB Agreement Act 1983 (note 2t). As at March 31, 2015 the general reserve was $114,891,311 (2014: $126,926,236).

h) Operational risk Operational risk is the risk of direct or indirect loss in both financial and non-financial terms arising from a wide variety of causes associated with the Bank’s processes, personnel, technology and infrastructure. It may also arise from external factors other than credit, market and liquidity risks such as those arising from legal and regulatory requirements and generally accepted standards of corporate behaviour. Operational risks arise from all of the Bank’s operations and are faced by all departments. h) Operat onal risk Operational risk is the risk of direct or indirect loss in both fin cial a d non-financial terms arising from a wide variety of causes associated with the Bank’ processes, p rsonnel, technology and infrastruc ure. It may also arise from external facto s other than credit, market an liquidity risks uc as those arising from legal and regulatory requirements and generally accepted standards f corpor te behaviour. Operat onal ri ks arise fr m all of the Bank’s per tions and are faced by ll d partments. h) Operational risk Operational risk is the risk of direct or indirect loss in both financial and non-financial terms arising from a wide variety of causes associated with the Bank’s processes, personnel, technology and infrastructure. It may also arise from external factors other than credit, market and liquidity risks such as those arising from legal and regulatory require ents and generally accepted standar s of orporat b h viour. Op rational risks arise from all of the Bank’s operations and are faced by all departments.

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ECCB ANNUAL REPORT 2014/2015

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