A microfinance investment vehicle of Belgium’s Incofin Investment Management, agRIF, recently paid an undisclosed sum to acquire a 10-percent stake in Inecobank, a commercial bank in Armenia whose mission is “to promote private sector development acting as a trustworthy and honest partner and advisor for micro, small and medium-sized enterprises.” Through the transaction, the World Bank Group’s International Finance Corporation and Deutsche Investitions-und Entwicklungsgesellschaft (DEG), a subsidiary of German development bank Kreditanstalt für Wiederaufbau (KfW), sold all of their shares in Inecobank.
In addition to traditional face-to-face services, Inecobank offers multiple digital services, including mobile banking and a fully automated consumer lending service. For the quarter ending March 2018, the bank reported pre-tax profit of AMD 2.5 billion (USD 5.2 million) on total assets of AMD 273 billion (USD 564 million) managed via 24 branches.
The new investor, agRIF, is the successor to Incofin Investment Management’s Rural Impulse Funds (RIFs) I and II. This is the fund’s first investment in Armenia. Incofin is for-profit firm that manages assets worth USD 850 million – as of 2017 – through the following funds: Incofin CVSO, agRIF, the BIO account, FAF, FPM, Impulse Microfinance Investment Fund, Invest in Visions, RIF I, RIF II, VDK Loan Portfolio and Volksvermogen.
DEG has a portfolio of EUR 8.3 billion (USD 9.8 billion) as of December 2017.
IFC offers loans, equity investments, advisory services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. IFC has 184 member countries and total assets of USD 95 billion as of September 2017.
The World Bank Group is a multilateral organization whose goal is “to end extreme poverty and promote shared prosperity in a sustainable way.” As of 2018, it has 189 member nations. The group encompasses (1) the International Bank for Reconstruction and Development and the International Development Association, which make up the World Bank; (2) IFC; (3) the Multilateral Investment Guarantee Agency; and (4) the International Centre for Settlement of Investment Disputes. During 2017, the World Bank Group disbursed funds totaling USD 44 billion.
Sources and Additional Resources
Information provided directly to MicroCapital by Incofin
Inecobank financial reports
https://www.inecobank.am/en/home/report/
Incofin fund descriptions
https://www.incofin.com/portfolio/category/funds/
DEG data
https://www.deginvest.de/International-financing/DEG/%C3%9Cber-uns/Kennzahlen/
KfW
http://kfw.de/
World Bank Group
http://www.worldbankgroup.org/
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