MICROCAPITAL BRIEF: Triodos Fair Share, Triodos Microfinance Funds to Invest Debt, Equity in India’s Janalakshmi, Kazakhstan’s KazMicroFinance, Kyrgyzstan’s Kompanion

Two microfinance investment vehicles managed by a unit of the Netherlands’ Triodos Bank, the Triodos Fair Share Fund (TFSF), and the Triodos Microfinance Fund (TMF), have agreed to invest jointly in the following organizations: (1) Janalakshmi Financial Services (JFS), a Bangalore-based microfinance institution (MFI) that will borrow USD 11.4 million to expand its financing of small and medium-sized enterprises (SME) in India; (2) KazMicroFinance (KMF), which is reportedly the largest MFI in Kazakhstan and will sell the Triodos funds stakes totaling 13.7 percent of the organization’s shares; and (3) Kompanion Financial Group, an MFI in Kyrgyzstan that will sell the funds stakes totaling 17.5 percent of the organization’s shares as it seeks to transform from a community development financial institution into a microfinance bank [1] [2] [3]. Kompanion also sold a 17.5-percent stake to Dutch public-private development bank FMO; Mercy Corps, the founder of Kompanion, is retaining 65-percent ownership of the institution. The prices paid for the equity stakes in KMF and Kompanion have not been released.

As of 2014, JFS reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 420 million, a gross loan portfolio of USD 342 million and 1.4 million active borrowers. As of 2013, the MFI reported return on assets of 1.97 percent and return on equity of 8.64 percent. As of 2015, KMF had a net loan portfolio of USD 118 million, approximately 98,000 clients and 90 service locations. As of 2014, Kompanion reported to MIX total assets of USD 102 million, a gross loan portfolio of USD 81 million, return on assets of 1.35 percent, return on equity of 9.14 percent and 113,000 active borrowers. None of these MFIs accept deposits.

As of December 2013, TFSF reported total assets of EUR 200 million (USD 228 million). As of 2014, TMF reported total assets of EUR 197.6 million (USD 232.9 million). As of 2013, Triodos Bank reported total assets of EUR 9,450 million (USD 10,740 million).

By Julia Marín, Research Associate

About Triodos Fair Share Fund (TFSF)

The Triodos Fair Share Fund (TFSF) is offered by Triodos Bank, a fully licensed independent bank with branch offices in the Netherlands, Belgium, United Kingdom and Spain. The Fund, founded in 2002, is a closed mutual fund held by private Dutch investors. The Fund invests debt and equity in microfinance institutions (MFIs) in Central and Eastern Europe as well as developing countries in other parts of the world. As of December 2013, the fund reported total assets of EUR 200 million (USD 228 million).

About Triodos Microfinance Fund (TMF)

The Triodos Microfinance Fund is a microfinance investment vehicle that invests 80 percent of its portfolio in established microfinance institutions (MFIs) and 20 percent in start-up institutions. The fund allocates approximately 30 percent of its holdings to equity and 70 percent to loans and debt securities. The fund accepts investments from institutional investors in Belgium, Denmark, Luxembourg, the Netherlands, and the UK. As of 2014, Triodos Microfinance Fund reported total assets of EUR 197.6 million (USD 232.9 million) from holdings in Latin America, Africa, Asia and Eastern Europe.

About Janalakshmi Financial Services (JFS)

Janalakshmi Financial Services (JFS) is a microfinance institution (MFI) located in India. It is focused primarily on offering loans and microinsurance in urban areas. As of 2014, JFS reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 420 million, a gross loan portfolio of USD 342 million and 1.4 million active borrowers. As of 2013, JFS reported return on assets of 1.97 percent and return on equity of 8.64 percent. The MFI does not accept deposits.

KazMicroFinance (KMF)

KazMicroFinance (KMF) is a non-banking financial institution that offers training as well as individual and group loans across Kazakhstan. KMF was founded in 1997 based on a microfinance project initiated by the United States Agency for International Development (USAID). As of 2015, it had a regional network of 90 service locations, a net loan portfolio of USD 118 million and approximately 98,000 clients. KMF strategic focus is on rural and “underserved” regions, with 70 percent of its clients female and 74 percent of its clients living in rural areas. The institution does not accept deposits.

About Kompanion

Kompanion Financial Group Microfinance Closed Joint Stock Company was established in Kyrgyzstan in 2004 through the consolidation of five microcredit agencies affiliated with Mercy Corps, a nonprofit economic development and aid organization based in the US. Kompanion describes itself as a “community development financial institution that seeks to combine conservation and development goals.” As of June 30, 2014, Kompanion reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 102 million, a gross loan portfolio of USD 81 million, return on assets of 1.35 percent, return on equity of 9.14 percent and 113,000 active borrowers. The institution does not accept deposits.

Sources and Additional Resources:

[1] Triodos Newsletter, Janalakshmi to expand further into untapped market

[2] Triodos Newsletter, Co-ownership in Kazakhstan

[3] Triodos Newsletter, Equity expansion in Central Asia

MicroCapital, August 26, 2014, Lok Capital, Michael and Susan Dell Foundation, Bellwether Microfinance Fund Exit Janalakshmi Financial Services of India

MicroCapital, May 24, 2011, Norwegian Microfinance Initiative (NMI) Global Fund Invests $2.8m in Triodos Microfinance Fund (TMF)

MicroCapital Universe: Triodos Fair Share Fund (TFSF)

MicroCapital Universe Profile: Triodos Microfinance Fund (TMF)

MicroCapital Universe Profile: Janalaskhmi Financial Services (JFS)

MicroCapital Universe Profile: Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO)

Do you know that MicroCapital publishes the MicroCapital Monitor newspaper each month? Find out more athttps://www.microcapital.org/products-page/