Incofin, a Belgian for-profit microfinance investment manager, has agreed to disburse loans of USD 3 million to FINCA Kyrgyzstan, a branch of US-based microfinance nonprofit FINCA International, and USD 2 million to Bai Tushum Partners, a microfinance institution (MFI) based in Kyrgyzstan. Of the funding for FINCA Kygyzstan, USD 2 million comes from VDK MFI Loan Portfolio and USD 1 million comes from the Rural Impulse Fund II, both of which are funds managed by Incofin. VDK Loan Portfolio, which was launched in 2007 by Belgium’s Volkdepositokas (VDK) Spaarbank, provided the entire loan to Bai Tushum. As of March 2011, FINCA Kyrgyzstan reported loans outstanding of USD 50 million and 110,000 clients As of 2010, it had total assets of USD 496 million, with an operating profit of USD 10 million. As of 2011, Bai Tushum reported total assets of USD 86.1 million, a gross loan portfolio of USD 55 million, ROE of 16.1 percent, ROA of 3.4 percent and 35, 428 active borrowers.
Incofin’s RuralImpulse Fund II also took a 35-percent equity stake in Unguka Bank Limited, an MFI in Rwanda, in return for an investment of unspecified size. The investment also included a technical assistance facility which is intended to help improve the bank’s infrastructure. The equity investment is intended to allow Unguka to grow its loan book by expanding into rural areas of Rwanda. Founded in 2005, Unguka Bank reported a net profit of RWF 230 million (USD 384,000), working capital of RWF 1.1 billion (USD 1.8 million) and five branches as of December 2010.
Incofin Investment Management is a private Belgian company that develops and manages funds investing in microfinance institutions (MFIs) in developing countries. As of June 2011, Incofin manages six facilities with total outstanding investments of USD 425 million placed in 39 countries.
By Brett Cohen, Research Associate
About FINCA Kyrgyzstan
A unit of US-based microfinance nonprofit FINCA International, FINCA Kyrgyzstan was established in 1995 with a USD 6.2 million grant from the United States Agency for International Development (USAID), a US government agency that supports global economic and humanitarian assistance. According to FINCA Kyrgyzstan, approximately 70 percent of the unemployed in Kyrgyzstan are women, which is why the organization mainly targets female bazaar workers as its clients. As of March 2011, FINCA Kyrgyzstan reported loans outstanding of USD 50 million and 110,000 clients.
About FINCA International
Founded in 1984 by Dr John Hatch, a pioneer of the village banking model, the Foundation for International Community Assistance (FINCA) International is a microfinance network based in Washington, DC, that provides financial services to poor families through a network of locally managed institutions. FINCA targets its services to poor women living in the Americas, sub-Saharan Africa and Eurasia. In the 2010 fiscal year, FINCA International served approximately 760,000 clients through its subsidiaries in 21 countries. As of 2010, it had total assets of USD 496 million, with an operating profit of USD 10 million. In December of 2011, FINCA launched a subsidiary, FINCA Microfinance Holdings LLC, with funding from the International Finance Corporation (IFC), KfW Bankengruppe, Nederlandse Financierings-Maatschappijvoor Ontwikkelingslanden NV (FMO), responsAbility, and Triple Jump.
About Bai Tushum
Bai Tushum and Partners is a microfinance institution (MFI) based in the Kyrgyz Republic. Bai Tushum’s mission is to contribute to the economic development of the Kyrgyz Republic through the delivery of microfinance services that lead to increased employment and otherwise meet the interests of its clients and investors. Bai Tushum’s products include agriloans; trade, service, and production loans; mortgage loans; consumer loans; and equipment financing. As of 2011, Bai Tushum reported total assets of USD 86.1 million, a gross loan portfolio of USD 55 million, ROE of 16.1 percent, ROA of 3.4 percent and 35, 428 active borrowers.
About Unguka Bank Ltd
Unguka Bank is a microfinance institution (MFI) that was established in Rwanda in 2005. As of December 2010, the organization reported net profit of RWF 230 million (USD 384,000), working capital of RWF 1.1 billion (USD 1.8 million) and five branches. Unguka Microfinance does not report to the Microfinance Information Exchange (MIX), the US-based microfinance data provider, and further financial details are not otherwise available.
About Incofin Investment Management
Incofin Investment Management is a private Belgian company that develops and manages funds investing in microfinance institutions (MFIs) in developing countries. As of year-end 2011, Incofin held total assets of USD 38 million and was working with 30 partner institutions in 21 countries that reach 1.8 million microentrepreneurs.
About Incofin VDK MFI Loan Portfolio
The Incofin VDK MFI Loan Portfolio was launched in 2007 by Volksdepositokas (VDK) spaarbank, a Belgian savings bank that is also one of Incofin’s shareholders. VDK spaarbank earmarked EUR 75 million (USD 110 million) for the fund and appointed Incofin to act as mediator for the facility. The fund invests in large microfinance institutions (MFIs) that are deemed “high-quality.” As of October 31, 2011, the VDK MFI Loan Portfolio has outstanding investments of EUR 59 million (USD 81.8 million).
About Incofin Rural Impulse Fund
The Incofin Rural Impulse Funds (RIF) were launched by Incofin Investment Management to invest in rural microfinance institutions (MFIs) that are deemed commercially viable. The two funds include Rural Impulse Fund I and Rural Impulse Fund II. They target both farm and non-farm populations in small towns and villages. The funds invest primarily through loans, though they make equity investments and guarantees as well. As of October 31, 2011, Rural Impulse Fund I has outstanding investments of EUR 25.7 million (USD 35.9 million) and a fund size of EUR 30 million (USD 38 million), while Rural Impulse Fund II has outstanding investments of EUR 33.1 million (USD 46.0 million) and a fund size of EUR 120 million (USD 173 million).
Sources and Additional Resources
Incofin.com press release: “Rural Impulse Fund II takes a stake in Unguka Bank in Rwanda”
http://www.incofin.com/en/news/rural-impulse-fund-ii-takes-stake-unguka-…
Incofin.com press release: “Incofin IM invests USD 5 million in Kyrgyz MFIs”
http://www.incofin.com/en/news/incofin-im-invests-usd-5-million-kyrgyz-m…
MicroCapital.org story, June 11, 2012: “MICROCAPITAL BRIEF: Fairtrade, Incofin Launch Fund Offering Long-Term Microloans Starting in Latin America”
https://www.microcapital.org/microcapital-brief-fairtrade-incofin-launch-…
MicroCapital.org story, January 26, 2012: “MICROCAPITAL BRIEF: Incofin Rural Impulse Fund II, Triple Jump’s ASN-Novib Microkredietfonds Acquire Shares of AzerCredit of Azerbaijan”
https://www.microcapital.org/microcapital-brief-incofin-rural-impulse-fun…
MicroCapital.org Universe Profile: Incofin Investment Management
http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Inc…
MicroCapital.org Universe Profile: Incofin VDK Loan Portfolio
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Inc…
MicroCapital.org Universe Profile: Incofin Rural Impulse Fund
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Inc…
MicroCapital.org Universe Profile: FINCA Kyrgyzstan
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=FIN…
MicroCapital.org Universe Profile: FINCA International
https://www.microcapital.org/microcapital-brief-responsability-loans-6-4m…
MicroCapital.org Universe Profile: Bai Tushum
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Bai…
MicroCapital.org Universe Profile: Unguka Bank Ltd
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Ung…
Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/
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