by the MicroCapital Team -

Best in Class Just Keeps Getting Better: Swiss responsAbility Microfinance Investment Fund Lends $1,755,095 to German ProCredit Holding.

The responsAbility Global Microfinance Fund, ProCredit’s first private investor, augmented its stake in the holding company with loan of $1,755,095. Information on the duration of the loan is not publicly available.

Swiss-based ResponsAbility Global Microfinance Fund was founded in 2003 by Swiss financial institutions Credit Suisse, which is also the fund manager, Raiffeisen Banking Group, Baumann & Cie Banquiers, and the Andromeda Fund. Investment advisory services to the ResponsAbility Fund are provided by: Alterfin, BlueOrchard Finance, IPC/ProCredit Holding, FINCA International, Symbiotics, Opportunity International, and PlaNet Finance. ResponsAbility loans between $50,000 and $1.5 million to MFIs for a maximum of 5 years at a rate equal to “LIBOR plus full cost plus full risk.” The Fund’s total assets amounted to just over $45 million as of January 2006 with over $43 million allocated to microfinance investments.

Established in 1998 as the leader and main shareholder of the ProCredit Group, which consists of 19 microbanks with microcredit programs in different countries, ProCredit Holding controls its subsidiaries closely, their website stressing investment in training and professional development. The ProCredit group had approximately å¥1.9 billion in total assets and a total loan portfolio of å¥1.3 billion as of October 2005. To date, the 19 microbanks have made about 526,000 loans to microentrepreneurs and small businesses, approximately 90% of which are under å¥10,000 and about 50% of which are below å¥1,000. ProCredit Holding reports its Return on Average Assets as of December 2004 2.4% and its Return on Average Equity as 19.5 %. ProCredit continues to distant itself from the micro-bank pack.

by the MicroCapital Team -

Impulse Microfinance Investment Fund Made $1,250,000 Debt Investment in Azerbaijan Micro Finance Bank (AMFB)

Established in 2002 by the European Bank for Reconstruction and Development (EBRD), International Finance Corporation (IFC), Black Sea Trade and Development Bank, and German LFS Financial Systems GmbH, AMFB provides financial services to micro and small business within the country. The bank’s typical microloans are between $400 and $10,000 for a maximum of 9 months. In June 2005, the Azerbaijan Microfinance Association reported that AMFB had a total loan portfolio of more than $11.4 million. It is the only one of the 45 commercial banks in Azerbaijan that focuses on microfinance services. AMFB does not report to the MIX Market, the World Bank’s microfinance information clearinghouse. Further information about their performance is not publicly available.

Established in 1992, Incofin invests in MFIs in 14 countries, and in mid-2005 had total assets of $5.6 million. The duration of Incofin’s loans, which are between $120,000 and $600,000, is five years, and the terms offered are “LIBOR plus full cost plus full risk”. At the end of 2004, Incofin, along with KBC, Boerenbond, VDK Spaarbank, Volksvermogen (Belgian institutional investors) set up the Impulse Microfinance Investment Fund, which had initial capital of å¥5 million. By mid-2005, the fund’s assets were worth $15,413,875. The fund invests between $300,000 and $1.5 million in MFIs, and offers the same terms as Incofin.

by the MicroCapital Team -

Microcredit Lender Converts on New Debt Investment

Amidst a rising tide of investment in emerging markets, The International Finance Corporation has agreed to provide a US$2.2 million financing package to Micro Credit Agency Bai Tushum Financial Foundation (BTFF). The investment is being made in the form of a US$1.2 million loan with an option for the IFC to convert a portion of the loan into a US$1 million dollar equity stake in the MFI.
Continue reading “Microcredit Lender Converts on New Debt Investment”

by the MicroCapital Team -

Calling All Outsiders!!! Hot Seminar in NYC on Microfinance Investment and Securitization, Place to Meet Who’s Who

We urge you to the Waldorf-Astoria February 6 & 7! This is the first all-star conference in New York City on microfinance securitization since microfinance securitization left Mexico for bigger markets.

Even if you only drop in for a morning or an afternoon, this is $350 well-spent. To insiders, participants are the usual suspects, but for those who want to meet the players in microfinance investment, this is a timely and convenient event indeed.

If you are committed to building microfinance as a safe investment class, then bring your friends with you.

by the MicroCapital Team -

Symbiotics Tells Story of Microfinance Investment Funds in Less Than 150 Words

Symbiotics, a new Swiss professional services firm catering to microfinance investors and fund managers, summarizes the investment funds landscape beautifully:

“Over fifty global and regional microfinance investment vehicles exist today, and at least as much local ones have been identified. All are expected to grown significantly in the coming few years. Foreign investment in microfinance totals over a billion dollars, and is growing rapidly (supply is expected to double in 2005 and double again by 2008).

Continue reading “Symbiotics Tells Story of Microfinance Investment Funds in Less Than 150 Words”

by the MicroCapital Team -

Microfinance Investment Funds Ranked by Size and Microcredit Allocation

FUND NAME Ranked by $ Size of Fund

SIZE OF FUND $USD

FUNDS ALLOCATED TO MICROFINANCE $USD

ROI

1. Oikocredit World Partnership Investments

304,662,000

80,764,000

2%

2. ProCredit Holding Aktiengesellschaft

110,918,700

89,181,767

5-6.5%

3. Calvert Community Investment Notes

80,000,000

20,000,000

3%

4. Dexia Microcredit Fund

51,669,512

46,334,570

5.5-7.5%

5. Blue Orchard Microfinance Securities

40,069,833

38,000,000

4.55-8.8%

6. ASN-Novib Fonds

28,421,190

9,473,730

1.20%

7. AXA World Funds

23,073,410

1,481,556

5.10%

8. MicroVest I, LP: Equity

not available

not available

7-9%

9. MicrovestI, LP: Subordinated Debt

not available

not available

4.5-6%

10. mPower Investment Program

not available

not available

0-3%

11. Impulse Microfinance Investment Fund

15,413,875

15,413,875

4%

12 Triodos Fair Share Fund

14,583,596

6,983,086

2-4%

13. Accion Investments in Microfinance

12,969,985

12,512,329

8-10%

14. responsAbility Global Microfinance Fund

11,449,977

11,449,977

3.56%

15. ALTERFIN

11,084,244

3,628,790

6%

16. Partners for the Common Good

7,095,500

300,000

3%

17. Latin American Bridge Fund

5,340,505

1,450,000

0-2.875%

18. CRESUD

2,483,480

1,490,088

2.75%

19. Global Bridge Fund

1,691,000

not available

0-2.875%

by the MicroCapital Team -

Microfinance Investment Funds Ranked by Microcredit Allocation

FUND NAME

SIZE OF FUND $USD

FUNDS ALLOCATED TO MICROFINANCE $USD

ROI

1. ProCredit Holding Aktiengesellschaft

110,918,700

89,181,767

5-6.5%

2. Oikocredit World Partnership Investments

304,662,000

80,764,000

2%

3. Dexia Microcredit Fund

51,669,512

46,334,570

5.5-7.5%

4. Blue Orchard Microfinance Securities

40,069,833

38,000,000

4.55-8.8%

5. Calvert Community Investment Notes

80,000,000

20,000,000

3%

6. Impulse Microfinance Investment Fund

15,413,875

15,413,875

4%

7. Accion Investments in Microfinance

12,969,985

12,512,329

8-10%

8. responsAbility Global Microfinance Fund

11,449,977

11,449,977

3.56%

9. ASN-Novib Fonds

28,421,190

9,473,730

1.20%

10. Triodos Fair Share Fund

14,583,596

6,983,086

2-4%

11. ALTERFIN

11,084,244

3,628,790

6%

12. CRESUD

2,483,480

1,490,088

2.75%

13. AXA World Funds

23,073,410

1,481,556

5.10%

14. Latin American Bridge Fund

5,340,505

1,450,000

0-2.875%

15. Partners for the Common Good

7,095,500

300,000

3%

16. Global Bridge Fund

1,691,000

not available

0-2.875%

17. MicroVest I, LP: Equity

not available

not available

7-9%

18. Microvest I, LP: Subordinated Debt

not available

not available

4.5-6%

19. mPower Investment Program

not available

not available

0-3%

by the MicroCapital Team -

World Bank Investing å¥30m of Equity in Microfinance Together with German Development Bank KfW to Establish “Southeast Europe Microfinance Fund” with an Expected Final Capitalization of å¥500m

The World Bank Group’s private sector arm, the International Finance Corporation (IFC) will invest å¥20 million in mezzanine “B” shares with a 10-year maturity and å¥10 million in senior “A” shares with a seven-year maturity, in the soon to be established European Fund for Southeast Europe (EFSE), which will eventually lend to banks and microfinance institutions (MFIs). The IFC’s stake is approximately 21% of the fund’s initial capitalization of å¥142 million. To reach its target of a å¥500 million capitalization within five years, EFSE expects to attract capital from multilateral and private institutional investors via multiple closings in the future. EFSE is expected to be the largest microfinance fund in Southeast Europe.
Continue reading “World Bank Investing å¥30m of Equity in Microfinance Together with German Development Bank KfW to Establish “Southeast Europe Microfinance Fund” with an Expected Final Capitalization of å¥500m”

by the MicroCapital Team -

ResponsAbility Global Microfinance Fund Investing More than $7m in 11 Microfinance Institutions in Jordan, Benin, Ecuador, Nicaragua, Bosnia and Herzegovina, and Peru

Swiss-based ResponsAbility Global Microfinance Fund was founded in 2003 by Swiss financial institutions Credit Suisse, which is also the fund manager, Raiffeisen Banking Group, Baumann & Cie Banquiers, and the Andromeda Fund. Investment advisory services to the ResponsAbility Fund are provided by: Alterfin, BlueOrchard Finance, IPC/ProCredit Holding, FINCA International, Symbiotics, Opportunity International, and PlaNet Finance. ResponsAbility loans between $50,000 and $1.5 million to MFIs for a maximum of 5 years at a rate equal to “LIBOR plus full cost plus full risk.” The Fund’s total assets amounted to just over $40 million as of November 30th 2005 with close to $37 million allocated to microfinance investments. For further information on some of ResponsAbility’s past investments please refer to our November 1st blog.
ResponsAbility made a å¥1.4 million equity investment into German-based international development holding company ProCredit Holding. Established in 1998 as the leader and main shareholder of the ProCredit Group, which consists of 19 microbanks with microcredit programs in different countries, ProCredit Holding controls its subsidiaries closely, their website stressing investment in training and professional development. The ProCredit group had approximately å¥1.9 billion in total assets and a total loan portfolio of å¥1.3 billion as of October 2005. To date, the 19 microbanks have made about 526,000 loans to microentrepreneurs and small businesses, approximately 90% of which are under å¥10,000 and about 50% of which are below å¥1,000. ProCredit Holding reports its Return on Average Assets as of December 2004 2.4% and its Return on Average Equity as 19.5 %.
ResponsAbility also made the following debt investments in microfinance institutions (MFIs):
Continue reading “ResponsAbility Global Microfinance Fund Investing More than $7m in 11 Microfinance Institutions in Jordan, Benin, Ecuador, Nicaragua, Bosnia and Herzegovina, and Peru”

by the MicroCapital Team -

Inter-American Development Bank Investing and Granting $650,000 to Microfinance Institution Pro Mujer Mexico

The Inter-American Development Bank (IADB) has approved financing, which includes a $500,000 loan and a $150,000 grant, for microfinance institution (MFI) Pro Mujer Mexico (PMM), which is a part of the New York City administered transnational wholesale microfinance network Pro Mujer International. The new funding will allow PMM to extend microcredit to Central Mexico, where microfinance services are not well-established. The MFI will subsequently make initial loans between $50 and $150 to both rural and urban women microentrepreneurs. PMM is a relatively young institution established in 2002, which had a $1.2 million loan portfolio and over 10,000 active borrowers at year end 2004.
Continue reading “Inter-American Development Bank Investing and Granting $650,000 to Microfinance Institution Pro Mujer Mexico”

by the MicroCapital Team -

Sierra Leonean Microfinance Investment and Technical Assistance Facility to Loan $700,000 to Finance Salone for Microcredit

Finance Salone Ltd., a Sierra Leonean non-profit microfinance institution (MFI), is expected to receive a $700,000 loan from the Microfinance Investment and Technical Assistance Facility (MITAF). Established in 2001, Finance Salone had total assets of $646,000 and a gross loan portfolio of $526,000 at year end 2004, reaching over 8,000 borrowers nationally. MIX Market, the World Bank information clearing house on microfinance, recognizes only two MFIs in Sierra Leone. Although further information is not publicly available, MIX also reports that Finance Salone had been expected to transform into a “foreign-owned for-profit” company in 2004.
Continue reading “Sierra Leonean Microfinance Investment and Technical Assistance Facility to Loan $700,000 to Finance Salone for Microcredit”

by the MicroCapital Team -

Belgian Investment Company Incofin Invests Over å¥1.5 Million in Three Microfinance Institutions (Fundación ESPOIR, FINCA Kosovo, EDPYME Confianza)

Belgium investment company Incofin has invested å¥250,000 in Ecuadorian microfinance institution (MFI) Fundación ESPOIR, while Incofin’s Impulse Microfinance Investment Fund has invested å¥1 million in FINCA Kosovo, and å¥500,000 into Peruvian MFI EDPYME Confianza.
Continue reading “Belgian Investment Company Incofin Invests Over å¥1.5 Million in Three Microfinance Institutions (Fundación ESPOIR, FINCA Kosovo, EDPYME Confianza)”

by the MicroCapital Team -

International Finance Corporation Makes $1m Equity Investment in Pakistani Tameer Microfinance Bank

The World Bank Group’s private sector arm, the International Finance Corporation (IFC), bought a 10% stake in Tameer, a fledgling Pakistani microfinance bank. Established in 1956 to promote private sector investment in developing countries, the IFC (based in Washington D.C.), had over $26 billion in total assets and a total committed loan portfolio of $19.3 billion as of the end of June this year.
Continue reading “International Finance Corporation Makes $1m Equity Investment in Pakistani Tameer Microfinance Bank”

by the MicroCapital Team -

East African Development Bank Floats $10.8 Million Bond for Partial Investment in Ugandan Microfinance

The East African Development Bank (EADB) is floating a $10.8 million bond with a seven-year tenure to raise funds for its projects in Uganda, which often require local currency, microfinance in particular. Established in 1980, the EADB provides financial services in its member states of Kenya, Uganda, and Tanzania, and had total assets of $190.3 million at year end 2003—the latest information available.
Continue reading “East African Development Bank Floats $10.8 Million Bond for Partial Investment in Ugandan Microfinance”

by the MicroCapital Team -

International Finance Corporation Makes $3 Million Equity Investment into New Microfinance Fund Solidus

Through a $3 million equity investment, the International Finance Corporation (IFC), the private investment company of the World Bank, has helped to create Solidus Investment Fund S.A., a new microfinance equity investment fund with a final capitalization projected to be $30 million. Established in 1956 to promote private sector investment in developing countries, the IFC (based in Washington D.C.), had over $26 billion in total assets and a total committed loan portfolio of $19.3 billion as of the end of June this year. The IFC’s stake in the company amounts to 15.54% of Solidus’ initial funding of $19.3 million.
Continue reading “International Finance Corporation Makes $3 Million Equity Investment into New Microfinance Fund Solidus”

by the MicroCapital Team -

Gates Foundation Dips Deeper in Microfinance, Neglecting Another Investment Opportunity with a $6 Million Microcredit Grant to Microfinance Network Freedom From Hunger

Recently, we reported on the worrying development of the massive Gates Foundation ($36 billion in total assets) entering microfinance not as an investor, but as a donor. Since then, the Bill & Melinda Gates Foundation has awarded a $6 million grant to California headquartered “transnational microfinance network” Freedom From Hunger (FFH).
Continue reading “Gates Foundation Dips Deeper in Microfinance, Neglecting Another Investment Opportunity with a $6 Million Microcredit Grant to Microfinance Network Freedom From Hunger”

by the MicroCapital Team -

Led by Deutsche Bank, German Microfinance Company ProCredit Holding Issues å¥45 Million Bond for Microcredit Investment

Marking the first time a microfinance organization has accessed the European capital markets on such a large scale, German-based ProCredit Holding AG issued a å¥45 million bond (rated BBB- by Fitch) in 7-year å¥20 million and 10-year å¥25 million tranches. Deutsche Bank was the advisor and book runner.

Continue reading “Led by Deutsche Bank, German Microfinance Company ProCredit Holding Issues å¥45 Million Bond for Microcredit Investment”