✨ Trust Investment Performance
27 JUNE 2012 NEW ZEALAND GAZETTE, No. 72 2031
EASTERN AND CENTRAL COMMUNITY TRUST INC
| Asset | Actual Return (%) | Benchmark Return (%) | Value Added (%) |
|---|---|---|---|
| NZ & Aus Equities | 2.9 | 1.5 | + 1.4 |
| NZ Property | 15.2 | 15.6 | - 0.4 |
| NZ Bonds | 7.1 | 6.8 | + 0.3 |
| Offshore Equities | -8.2 | -2.4 | - 5.8 |
| Aus Property | -6.8 | -11.1 | + 4.3 |
| Offshore Bonds | 7.0 | 9.6 | - 2.6 |
| Cash | 4.0 | 2.5 | + 1.5 |
| TOTAL | -0.4 | -1.6 | +1.2 |
The following table shows the actual performance, the benchmark performance and value added for all asset classes held by the Trust for the year ended 31st March 2011:
| Asset | Actual Return (%) | Benchmark Return (%) | Value Added (%) |
|---|---|---|---|
| NZ & Aus Equities | 11.9 | 4.5 | + 7.4 |
| NZ Property | 6.0 | 6.7 | - 0.7 |
| NZ Bonds | 9.2 | 8.8 | + 0.4 |
| Offshore Equities | 5.7 | 7.2 | - 1.5 |
| Aus Property | 6.5 | 1.6 | + 4.9 |
| Offshore Bonds | 14.4 | 4.4 | + 10.0 |
| Cash | 4.2 | 2.9 | + 1.3 |
| TOTAL | 8.0 | 8.0 | 0.0 |
Fair Value and Impairment
As all of the financial instruments are revalued at year end to published prices there is no subjectivity as to whether the assets are impaired. The fair value equals the carrying value for all financial instruments.
Credit Risk
Credit risk represents the risk that a counterparty to a financial asset fails to discharge an obligation which will cause the Trust to incur a financial loss.
With regard to the credit risk arising for financial assets, the Trust’s credit risk arises from any default by a counterparty. There is no security held over these assets.
Concentrations of risk arise when a number of financial instruments or contracts are entered into with the same counterparty or where a number of counterparties are engaged in similar business activities, geographic regions, or similar economic features that would influence their ability to meet their contractual obligations by reason of changes in economic, political or other conditions.
The Trust manages credit concentration risks through:
- a diversified and non-correlated basket of investments
- ensuring compliance with the individual mandate requirements of each investment.
The Trust Manager, Trust’s investment advisor and the Trust’s Board review the portfolios for compliance against each investment mandate on a regular basis. The Fund Managers ensure that the funds they manage comply with their mandates as defined in the SIPO.
As at 31st March 2012 the maximum exposure to credit risk for New Zealand corporate bonds is detailed in the table below. The credit quality of the Trust’s NZ Bond portfolio is managed by the Trust using Standard and Poor’s rating categories.
| AAA to AA- | A+ to A- | BBB+ to BB | Unrated | 2012 $ | 2011 $ | |
|---|---|---|---|---|---|---|
| Corporate Bonds | 7.1% | 31.0% | 52.1% | 9.8% | 37,660,368 | 43,002,219 |
| Cash | 100% | 3,292,497 | 8,887,550 | |||
| Total | 40,952,865 | 51,889,769 |
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NZ Gazette 2012, No 72
✨ LLM interpretation of page content
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Eastern and Central Community Trust Investment Portfolio
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💰 Finance & RevenueInvestment Portfolio, Asset Allocation, Performance Measurement, Trust Management