CARIBBEAN CONFEDERATION OF CREDIT UNIONS 61ST ANNUAL INTERNATIONAL CONVENTION TRINIDAD AND TOBAGO 2018

Trinidad & Tobago Unit Trust Corporation

Who Are We?

The Credit Union Movement

TT$14Bn Assets Under Management Many Credit Unions established over 50 years ago Who Over 129 active Credit Unions in T&T Are Over 600,000 members You? TT$14Bn Assets Under Management

Meeting of Minds People centered financial institutions Service oriented of Minds Home grown (Indigenous)

RAPID GROWTH!!! Meeting of Minds Credit Unions in Trinidad and Tobago grew from AUM TT$5 Billion to TT$13 Billion in 8 years (2005 – 2013) of Minds UTC grew from AUM TT$1 Billion to TT$15 Billion in 10 years (1996 – 2006)

VALUE PROPOSITION The UTC and the Credit Union sector have many similarities, share much of the same clientele and together form a critical part of the fabric of domestic indigenous financial institutions. Over the last decade Credit Unions have grown significantly. However, rapid growth brings many challenges. The UTC has had to address many such challenges during the last decade, as a result of our rapid growth over the past 20 years from TT$1 Billion to TT$20 Billion in AUM. The UTC is in a unique position to transfer knowledge to the Credit Union movement to manage these challenges, especially in the areas of Investment Management and Enterprise Risk Management.

Credit Union Institutional Strengthening Symphony Credit Union Institutional Strengthening

SYMPHONY /’simf(э)ni/ Noun, 1. an instrumental piece, often in several movements, forming overture to an opera or the like. 2. anything characterized by a harmonious combination of elements, especially an effective combination of colors. 3. harmony of sounds.

SYMPHONY Credit Union Movement Unit Trust Corporation

Introduction Symphony seeks to enhance the institutional capacity of the Credit Union sector, specifically in the areas of Investment Management and Enterprise Risk Management. These will be achieved while simultaneously deepening the Unit Trust’s relationship with the Credit Union Sector.

Investment Management Services Overview Project Symphony is aimed at: Strengthening the Credit Union movement through capacity building; Enhancing the relationship between the UTC and the Credit Union movement Enterprise Risk Management Investment Management Services This will be conducted under two broad areas:

Benefits UTC CREDIT UNIONS OTHER STAKEHOLDERS Leveraging an existing skill set for the benefit of the Credit Union movement. Strengthening of relationship with core UTC clientele CREDIT UNIONS Developing stronger Investment Management capability Developing robust Enterprise Risk Management Frameworks OTHER STAKEHOLDERS Enhancing protection of members’ savings at Credit Unions Improved level of comfort for Auditors and Regulators in terms of these key Board and Management capabilities

Background UTC met with the Trinidad and Tobago Commissioner of Cooperatives, who is the Regulator for Credit Unions in May 2017 to discuss Symphony. A sample of fourteen (14) Credit Unions across Trinidad & Tobago between June and August, 2017 were visited. The fourteen Credit Unions were selected based on Credit Union Size i.e. Assets Under Management (Small/Medium/Large); Credit Union orientation (Open circuit/Closed circuit); and geographic location (North/South/East/West/Tobago). These visits to Credit Unions across Trinidad & Tobago confirmed that there is strong interest from the Credit Unions in building capacity in the two aforementioned areas.

INVESTMENT MANAGEMENT

Overview The creation of customized Investment Policies for Credit Unions complemented by training in the application and maintenance of the Investment Policy. Major Deliverables are: 01 Investment Policy 02 03 Managed Accounts Training A customized Investment Policy for the Credit Union Training for Management and Board of Directors in the application and maintenance of the Investment Policy Managed Investment Portfolios for the Credit Union

ENTERPRISE RISK MANAGEMENT

Overview 3 2 1 Three phases of roll out are: Enhanced Capabilities Setting the Foundation (Gap Analysis) Seeks to identify the “current state” and “desired state”; Adopt a common risk language; Determine Key Risk Indicators; Create ERM Dashboard Building Competencies Improves risk culture, introduces risk assessments and risk prioritization and risk responses Enhanced Capabilities ERM is a standard practice, financial performance improves and operational costs are reduced. A CULTURE of risk management is entrenched 1 2 3

Overview Training for the ERM components will focus on individual Credit Unions, as the specific requirements may differ for each entity. Deliverables for each phase are: Setting the Foundation (Gap Analysis) 01 02 Building Competencies 03 Enhanced Capabilities Defining (risk) culture Risk Management Glossary Risk Appetite Statement Streamlining risk related information to the Board of Directors Risk Assessments Identification of Risk Owners Clearly Articulated Risk Responses Process for risk based review and external environment

BETA TESTING

Beta Testing Value/Viability Appropriateness Cost Testing was conducted with two Credit Unions and as such we are able to confirm the following: Value/Viability The initiative is valuable and viable for the Credit Union and UTC. Appropriateness The appropriate timeframe estimated for the successful completion of each train will vary with each Credit Union. However, it is dependent on the commitment by the Board and Management. Cost The models are designed to be scalable.

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