Bahamas - FirstCaribbean International Bank

Notes to the Consolidated Financial Statements
October 31, 2007
(expressed in thousands of Bahamian dollars)
18. Share capital and reserves (continued)
Statutory loan loss reserve — Bahamas
2007 2006
$ $
19. Net interest income
2007 2006
$ $
(Restated)
Balance, beginning of year 14,661 —
Transfers from retained earnings 1,834 14,661
Balance, end of year 16,495 14,661
Banking Regulations of The Central Bank of The Bahamas require a general provision
in respect of the performing loans of at least one percent of these loans. To the
extent the inherent risk provision for loans and advances to customers is less than
this amount, a statutory loan loss reserve has been established and the required
additional amount has been appropriated from retained earnings, in accordance
with IFRS.
Reverse acquisition reserve
2007 2006
$ $
Reverse acquisition reserve, beginning
and end of year (63,566) (63,566)
Interest and similar income
Cash and short term funds 16,180 20,082
Financial assets at fair value through profit or loss 26,412 22,996
Investment securities 46,396 15,668
Loans and advances 196,838 184,408
Reverse repos and other 2,775 2,325
288,601 245,479
Interest and similar expense
Banks and customers 123,803 92,723
Other borrowed funds 19,336 652
Derivatives, net (1,698) (1,968)
141,441 91,407
Net interest income 147,160 154,072
At October 11, 2002, the equity of the Bank comprised the equity of Barclays
Bahamas together with the fair value of the consideration given to acquire CIBC
Bahamas. However, legally the share capital of the Bank comprised the issued share
capital of CIBC Bahamas plus the shares issued to effect the combination, recorded
at fair value. The reverse acquisition reserve is therefore the difference between
the legally required share capital together with the retained earnings of Barclays
Bahamas, and the equity of the Bank presented in accordance with IFRS.
See Auditors’ Report Page 56.
80