Bahamas - FirstCaribbean International Bank

Notes to the Consolidated Financial Statements
October 31, 2007
(expressed in thousands of Bahamian dollars)
76
11. Retirement benefit assets and obligations
The Bank has an insured group health plan and a pension plan. The pension plan is
a mixture of defined benefit and defined contribution schemes. The defined benefit
sections of the scheme are non-contributory and allow for additional voluntary
contributions. The insured health plan allows for retirees to continue receiving
health benefits during retirement. Independent actuaries value the plan every three
years. The most recent actuarial valuations of the plan assets and the present value
of the defined benefit obligation were carried out as at November 1, 2004. At
November 30, 2004, the valuation revealed a fund surplus of $20.0 million.
The amounts recognised on the balance sheet are determined as follows:
Defined benefit Post-retirement
pension plans medical benefits
2007 2006 2007 2006
$ $ $ $
Fair value of plan assets 92,254 83,149 — —
Present value of
funded obligations (68,189) (56,398) (3,582) (9,368)
24,065 26,751 (3,582) (9,368)
Unrecognised actuarial gain (10,563) (13,097) (232) (2,240)
Net asset/(liability) 13,502 13,654 (3,814) (11,608)
The pension plan assets include 100,000 ordinary shares in the Bank.
The actuarial return on plan assets for the defined benefit sections of the pension
plan is $10,680 (2006: $6,494).
The amounts recognised in the consolidated statement of income are as follows:
Defined benefit Post-retirement
pension plans medical benefits
2007 2006 2007 2006
$ $ $ $
Current service costs 2,854 2,873 519 526
Curtailment and settlement costs (324) (378) (8,860) (52)
Expected return on plan assets (6,177) (6,158) — —
Interest cost 3,800 3,598 639 639
Total amount included
in staff costs 153 (65) (7,702) 1,113
See Auditors’ Report Page 56.
11. Retirement benefit assets and obligations (continued)
The movements in the net asset/(liability) recognised on the balance sheet are as
follows:
Defined benefit Post-retirement
pension plans medical benefits
2007 2006 2007 2006
$ $ $ $
Balance, beginning of year 13,654 13,597 (11,608) (10,600)
Charge for the year (153) 65 7,702 (1,113)
Contributions paid — (8) — —
Employer premiums for
existing retirees — — 92 105
Foreign exchange
translation gain 1 — — —
Balance, end of year 13,502 13,654 (3,814) (11,608)
Changes in the present value of the defined benefit obligation are as follows:
2007 2006
$ $
Present value of funded obligations at
beginning of year 56,398 50,440
Interest cost 3,800 3,598
Customer service cost 2,854 2,873
Benefits paid (1,575) (963)
Actuarial loss on obligation 6,712 450
Present value of funded obligation at end of year 68,189 56,398
Changes in fair value of the plan assets are as follows:
2007 2006
$ $
Fair value of plan assets at beginning of year 83,149 77,449
Expected return on plan assets 6,177 6,158
Benefits paid (1,575) (963)
Actuarial gain on plan assets 4,503 505
Fair value of plan assets at end of year 92,254 83,149