Year*CBTT prof­its

2023*$1.58B

2022*$550.66M

2021*$756.48M

2020*$1.37B

2019*$1.88B

2018*$1.47B

2017*$1.04B

2016*$713.42M

2015*$699.73M

2014*$329.88M

The Cen­tral Bank of Trinidad and To­ba­go (CBTT) de­clared a net prof­it of $1.58 bil­lion ($1,587,477,000) for its fi­nan­cial year end­ed Sep­tem­ber 30, 2023, an in­crease of 188 per cent com­pared to the $550.66 mil­lion prof­it T&T’s mon­e­tary au­thor­i­ty and reg­u­la­tor of fi­nan­cial in­sti­tu­tions re­port­ed in 2022.

The Cen­tral Bank Act re­quires the in­sti­tu­tion to re­mit all of its prof­its to the Con­sol­i­dat­ed Fund. (see box).

The Cen­tral Bank’s $1.58 bil­lion net prof­it for its 2023 fi­nan­cial year is record­ed in the bud­get doc­u­ment Draft Es­ti­mates of Rev­enue for the Fi­nan­cial year 2025 as eq­ui­ty prof­its in the re­vised es­ti­mates for 2024.

In the re­vised es­ti­mates for 2024, the Cen­tral Bank’s $1.58 bil­lion eclipses the $914.69 mil­lion in in­ter­est, div­i­dends and sur­plus gen­er­at­ed by T&T’s state en­ter­pris­es.

The Cen­tral Bank’s net prof­it for 2023, record­ed in the Con­sol­i­dat­ed Fund for the 2024 fi­nan­cial year, equals 3.24 per cent of the re­vised es­ti­mate of to­tal rev­enue for 2024 of $48.76 bil­lion ($48,764,897,868).

In the ten-year pe­ri­od from 2014 to 2023, the Cen­tral Bank’s net prof­it in 2023 was on­ly sur­passed in 2019, when the in­sti­tu­tion gen­er­at­ed $1.88 bil­lion. In the ten-year pe­ri­od, the Bank con­tributed $10.38 bil­lion to the Con­sol­i­dat­ed Fund.

In its 2023 an­nu­al re­port, which was pub­lished on May 10, 2024, the Cen­tral Bank dis­closed that it earned $1.52 bil­lion “in in­come from for­eign cur­ren­cy as­sets.”

When in­vest­ment ex­pens­es, re­alised loss from cur­ren­cy trans­la­tions and net loss re­alised on dis­pos­al and amor­ti­sa­tion of in­vest­ments are net­ted off, the Bank gen­er­at­ed $1.32 bil­lion from its for­eign cur­ren­cy as­sets port­fo­lio. That was ten times more than the $130.82 mil­lion the Bank record­ed in its 2022 fi­nan­cial year.

The Cen­tral Bank’s to­tal rev­enue for the year end­ing Sep­tem­ber 30, 2023, was $2.408 bil­lion, with $1.327 bil­lion com­ing from net in­vest­ment in­come on for­eign cur­ren­cy as­sets and $1.023 bil­lion from net rev­enue from lo­cal cur­ren­cy as­sets. That means 55 per cent of the Cen­tral Bank’s to­tal rev­enue came from the in­come gen­er­at­ed by its for­eign as­sets. The bal­ance, main­ly in­ter­est in­come of $950.43 mil­lion, came from the Bank’s TT-dol­lar as­sets.

Asked what are the gen­er­al ar­eas that the Cen­tral Bank de­rives in­come from, a spokesper­son for the in­sti­tu­tion said: “Gen­er­al­ly speak­ing, the Cen­tral Bank’s for­eign in­come re­flects earn­ings from in­vest­ments of for­eign re­serves. Lo­cal in­come prin­ci­pal­ly in­cludes in­ter­est charged on cus­tomer ac­counts and su­per­vi­so­ry fees. See the Bank’s pub­lished ac­counts for more de­tails.”

The Bank’s 2023 an­nu­al re­port ac­tu­al­ly shows a de­cline in its for­eign as­sets for that year com­pared to 2022.

As at Sep­tem­ber 30, 2023, the Cen­tral Bank’s to­tal for­eign cur­ren­cy as­sets amount­ed to the TT-dol­lar equiv­a­lent of $32.38 bil­lion, com­pared to $39.63 bil­lion in the 2022 fi­nan­cial year:

* The in­sti­tu­tion held $16.24 bil­lion in for­eign cur­ren­cy cash and cash equiv­a­lents at the end of its 2023 fi­nan­cial year, com­pared to $20.36 bil­lion at the end of Sep­tem­ber 30, 2022.

* Its for­eign cur­ren­cy in­vest­ment se­cu­ri­ties at the end of its 2023 fi­nan­cial year amount­ed to $19.14 bil­lion, com­pared to $19.27 bil­lion in 2022.

Ques­tioned on what hap­pened in the Bank’s 2023 fi­nan­cial year, which led to $1.50 bil­lion in in­vest­ment in­come from for­eign cur­ren­cy as­sets, the spokesper­son said, “A key con­tribut­ing fac­tor was rel­a­tive­ly high ex­ter­nal in­ter­est rates.”

It was point­ed out to the spokesper­son that the es­ti­mate of Cen­tral Bank’s eq­ui­ty prof­its for 2025 in the Draft Es­ti­mates of Rev­enue was $1.60 bil­lion, slight­ly high­er than the $1.58 bil­lion that went in­to the Con­sol­i­dat­ed Fund for 2024. Does that mean that the Cen­tral Bank has com­mu­ni­cat­ed to the Min­istry of Fi­nance that what the Bank did in 2024 will re­oc­cur in 2025?

“Each year the Cen­tral Bank’s pro­vides an es­ti­mate of its prof­it for the up­com­ing year to the Min­istry of Fi­nance, which the Min­istry utilis­es as a base for its own Draft Rev­enue Es­ti­mates,” the spokesper­son re­spond­ed.

Cen­tral Bank ex­pens­es

The Bank’s op­er­at­ing ex­pens­es for 2023 to­talled $821.12 mil­lion. That was 54.4 per cent high­er that the $531.86 mil­lion in ex­pens­es for the 2022 fi­nan­cial year.

The largest con­trib­u­tor to the Cen­tral Bank’s op­er­at­ing ex­pens­es in its 2023 fi­nan­cial year was salaries and re­lat­ed ex­pens­es, which amount­ed to $350.55 mil­lion. The Bank’s salaries and re­lat­ed ex­pens­es in 2023 more than dou­bled com­pared to 2022 when it to­talled $167.35 mil­lion.

The Bank’s ex­pen­di­ture on salaries and al­lowances for 2023 to­talled $246.10 mil­lion, 15.6 per cent more than the $212.91 mil­lion for the 2022 fi­nan­cial year.

The ma­jor con­trib­u­tor to the in­crease in salaries and re­lat­ed ex­pens­es in 2023 was $60.32 mil­lion spent on pen­sion and post-re­tire­ment med­ical plan in that year.

The Cen­tral Bank spent $104.13 mil­lion in ‘oth­er op­er­at­ing ex­pens­es’ in its 2023 fi­nan­cial year, com­pared to $100.11 mil­lion in 2022. The main ex­pens­es in that cat­e­go­ry were com­put­er-re­lat­ed, $32.74 mil­lion in 2023 com­pared to $29.21 mil­lion in 2022, and main­te­nance cost of $27.75 mil­lion in 2023 ($27.61 mil­lion in 2022).

Gov­er­nor speaks

In the fore­word to the an­nu­al re­port, Cen­tral Bank Gov­er­nor, Dr Alvin Hi­laire, praised the “firm com­mit­ment and dili­gence of the staff” of the Bank, not­ing that it reg­is­tered ma­jor suc­cess­es in the ex­e­cu­tion of its 2021/22 – 2025/26 strate­gic plan. One of the achieve­ments he point­ed to was the im­ple­men­ta­tion of the Elec­tron­ic Cheque Clear­ing Sys­tem. The an­nu­al re­port states that the ECCS was suc­cess­ful­ly im­ple­ment­ed in Feb­ru­ary 2023. The op­er­a­tor of the ECCS is In­folink Sys­tems Ltd (ISL).

The ECCS was the cause of a ma­jor dis­pute be­tween the Min­is­ter of Fi­nance, Colm Im­bert, and Au­di­tor Gen­er­al, Jai­wan­tee Ram­dass, over rev­enue dis­crep­an­cies as a re­sult of the new sys­tem.

The in­sti­tu­tion’s fi­nan­cial state­ments for its 2023 fi­nan­cial year were signed on De­cem­ber 15, 2023, by Ram­dass, who opined that “the fi­nan­cial state­ments...present fair­ly, in all ma­te­r­i­al re­spects, the fi­nan­cial po­si­tion of the Cen­tral Bank of Trinidad and To­ba­go as at Sep­tem­ber 30, 2023...”

The Cen­tral Bank Act

“35.(1) The Bank shall es­tab­lish and main­tain a Gen­er­al Re­serve Fund.

(2) The Bank may, with the ap­proval of the Min­is­ter, es­tab­lish Spe­cial Re­serve Funds of spec­i­fied amounts.

(3) The Bank may place in the Gen­er­al Re­serve Fund or the Spe­cial Re­serve Funds, or in both the Gen­er­al Re­serve Fund and the Spe­cial Re­serve Funds, an amount that does not ex­ceed ten per cent of the net prof­it of the Bank for a fi­nan­cial year.

(4) The net prof­it of the Bank for a fi­nan­cial year shall be de­ter­mined af­ter—

(a) al­low­ing for the ex­pens­es of op­er­a­tions, in­clud­ing re­place­ment and ac­qui­si­tion of as­sets for the op­er­a­tions of the Bank;

(b) pro­vi­sion has been made for bad and doubt­ful debts, de­pre­ci­a­tion in as­sets, con­tri­bu­tion to staff pen­sion ben­e­fits and oth­er con­tin­gen­cies.

(5) Sub­ject to sub­sec­tion (7), at the end of each fi­nan­cial year, af­ter al­low­ing for the amount re­ferred to in sub­sec­tion (3), the net prof­it of the Bank shall be paid in­to the Con­sol­i­dat­ed Fund.

(6) When the sum stand­ing to the cred­it of the Gen­er­al Re­serve Fund equals the au­tho­rised cap­i­tal of the Bank, no fur­ther con­tri­bu­tion to the Gen­er­al Re­serve Fund shall be made.

(7) Any loss in­curred by the Bank dur­ing a fi­nan­cial year may be met from the Gen­er­al Re­serve Fund or from the Spe­cial Re­serve Funds where the Gen­er­al Re­serve Fund is in­suf­fi­cient.

(8) Where the Gen­er­al Re­serve Fund and the Spe­cial Re­serve Funds are in­suf­fi­cient for the pur­pose re­ferred to in sub­sec­tion (7), the Bank, with the ap­proval of the Min­is­ter, may car­ry for­ward and re­coup the loss­es from fu­ture prof­its be­fore fur­ther pay­ment is made in­to the Con­sol­i­dat­ed Fund.”

The Cen­tral Bank’s cap­i­tal and its gen­er­al re­serve fund each to­tal $800 mil­lion.