ECCT grants more than $2m to Hawke's Bay, despite challenging market conditions

ECCT chairwoman Shelly Mitchell-Jenkins at the trust's annual meeting in Hastings. Photo / Supplied.

Volatile investment markets have failed to impact on Eastern and Central Community Trust's abilities to put money into Hawke's Bay but ECCT says it expects markets to deliver lower income "for some time".

Eastern & Central Community Trust (ECCT) gave almost $5.6 million to community organisations across its regions over the last financial year, ECCT Chairwoman Shelly Mitchell-Jenkins announced at the trust's annual meeting in Hastings.

"A total of 640 organisations - from East Cape down to Wairarapa, and across to Manawatu and Horowhenua - received grants from Eastern & Central Community Trust in the year ending March 31, 2018.

"This was slightly up on the amount we granted the previous financial year, and is a very pleasing result."

A total of $2,063,320 was granted to 221 organisations in Hawke's Bay - an increase on the $1,788,966 granted to 214 organisations in Hawke's Bay from a total grants budget of $5.1 million, the previous year.

Grants ranged in size from $500 for the Hawke's Bay Live Poets' Society's operating costs, up to $250,000 to go towards the Hawke's Bay Community Fitness Centre Trust's new sporting and health centre at the regional sports park.

Mitchell-Jenkins said the trust's financial returns remained positive this year, returning
a surplus, albeit a lower one than the "stellar" performance of the previous year.

ECCT's latest Annual Report recorded a surplus of almost $2m, down from $9.3m. While revenue fell $7m to $9.2m.

"The result somewhat impacted by a dip in equity markets near year end," Mitchell-Jenkins said.

"The trust is, and will be, operating in an investment market that delivers lower income in the form of interest and dividends for some time.

"Investment markets are also likely to continue to be volatile. This creates a challenge for trustees when making decisions to distribute funds and manage investments. Trustees must balance the desire for intergenerational equity in distribution and the protection of the base capital.

"We must also ensure we understand our communities and the priorities that are
important to them. Continuing to prudently manage the funds we hold, and to grant effectively, are our top priorities for the trustees."

Trust Bank Eastern and Central Community Trust was created in 1988 when New Zealand's banking industry was deregulated. The Trust was provided with shares in the Trust Bank Group to the value of $11.8 million to hold for the benefit of the communities within a defined region.

The trust was renamed Eastern and Central Community Trust Inc. in 1996, when the Trust Bank Group was sold to Westpac Banking Corporation for $1.2 billion, of which the trust received $109 million as its share of the proceeds.

The starting capital of the trust was set at $90 million, with $19 million set aside as capital reserves. Funds were invested in diversified range of asset classes in New Zealand and overseas.

The trust has now increased its capital to $174 m.

It is the eighth largest of the 12 Community Trusts across New Zealand and serves communities the length of the East Coast of the North Island, from Gisborne District in the north, through Hawke's Bay, Tararua, down to Wairarapa and across into Manawatu and Horowhenua.