2022 Treasurer's Report

Gross Income

Gross income was posted at Php248,209,333.00 surpassing the Php211,965,167.00as last year’s figure. This is due to the aggressive collection of our loan receivables. Interest income from loan comes from the collected amortization since the Association is using diminishing method of realizing the interest imposed on the loans granted to its members.

Interest Income on Bank Deposits are consisted of interest gained from time deposit, savings account and investments net of the withholding tax imposed by the bank.

Other Income is composed of Service Fee, A-Fund (insurance deducted from the loan) and Miscellaneous fee.

Total Operating Expenses

The Association’s normal operating consists of compensation, provision for credit losses and administrative expenses.

Compensation and fringe benefits consists of the staff’s salaries and wages, staff benefits as well as government mandatories like SSS, Philhealth and Pag-ibig contributions. There is significant increase in compensation since we have hired additional workforce for the year. Two Accounting personnels were hired during the year to facilitate more efficient and timely generation of reports to comply with the BSP’s time frame to avoid incurrence of penalties.

Compensation and fringe benefits are the salaries and wages of the employees and officers of the Association, including the mandatory contributions to SSS, PhilHealth, and Pag-IBIG. The increase in compensation and fringe benefits is due to the increase in salaries and wages of employees.

On the other hand, provision for credit losses is the expense the Association incurred from uncollectible loan accounts. This arise when loan receivables become delinquent with no ways to collect from the principal as well the co-makers. We are recognizing this as an expense and will write off after the BSP approval.

Administrative Expense is consisting of the assemblies and conferences, director’s fee, representation and transportation, depreciation expense, as well as repairs and maintenance, stationery and office supplies among others. You may have noticed increase in total expense in 2022 since in 2021 there are still restriction as to face-to-face transactions.

One of the causes of increase in the administrative expense is due to the implementation of BSP directives with regard to giving sufficient trainings and seminars for all the staffs and members of the Board, thus increasing the Assemblies and Conferences account. Professional fees of accredited lecturers and facilitator falls into this category.

Total Expenses for the year 2022 was tallied at Php18,507,300.00 which is lower than the Php34,170,906.00 expense of 2021. This was mostly due to the loan-loss provisioning mandated by Bangko Sentral ng Pilipinas on their 2021 examination and was already booked in 2021. However, there is increase in the administrative expense is due to the implementation of BSP directives with regard to providing sufficient trainings and seminars for all the staffs and members of the Board as well as increase in salaries and wages of employees.

Net Income

As a result, the Association was able to record a net income of Php229,702,032.00 in 2022, 23% higher than the recorded 2021 net income of 2021 amounting to Php177,794,261.00.

With this level of profitability, the Association was able to declare an annual dividend of 16% for the year 2022 amounting to Php229,588,119.07 after satisfying Bangko Sentral ng Pilipinas reserve requirements such as withdrawable share reserves, office building reserve and defined benefit obligation reserve.

Many are wondering regarding the stoppage of the acceptance of capital/savings deposits. This is because of the loan buy-out program of GSIS through GFAL, thus the Association has to solve the liquidity issue by utilizing the remittance from GSIS in order to yield good dividend rate. This was also implemented as one of the strategic initiatives of the Association to strike balance between granting competitive dividend rate while maintaining low interest rates for our loan products.