MICROCAPITAL STORY: responsAbility Global Microfinance Fund (rAGMF) Makes Loans to Caritas del Peru, MiBanco of Peru, Proempresa of Peru and FIELCO of Paraguay in March 2009 totaling $10.5m

In March 2009, responsAbility Global Microfinance Fund (rAGMF) reported four loans to the Consultative Group to Assist the Poor (CGAP) Microfinance Dealbook, a monthly report on microfinance capital market transactions. responsAbility is a Switzerland-based asset management firm that connects social investors with microfinance institutions (MFIs). Three loans were made to Peruvian MFIs Caritas del Peru (USD 500,000), MiBanco (USD 7.5 million) and to Proempresa (USD 1 million (in local currency)). A Loan was also granted to FIELCO of Paraguay of USD 1.5 million. These loans were made through responsAbility’s Global Microfinance Fund (rAGMF) which invests either directly in MFIs or indirectly through microfinance investment vehicles.

The loan of USD 500,000 to Caritas del Peru will help continue its works in the poorest regions of Peru where it serves over 24,000 borrowers of which 73 percent are women. Caritas was founded in 1955 by the Peruvian Episcopal Conference and as at the end of December 2007 Total Assets were USD 17.7 million and the gross Loan Portfolio was USD 14.8 million. Return on Assets was 9 percent and the Debt to Equity ratio 47 percent (as reported to the MIX Market, the microfinance information clearinghouse). No rating information is available.

MiBanco of Peru was granted a USD 7.5 million loan from rAGMF in March. MiBanco is a private bank, established in 1998 when it took over the operations of Acción Comunitaria del Perú, an NGO, which had been working with microentrepreneurs for 33 years. Currently it works in the Lima and Callao areas where it serves over 361,000 borrowers. As at 31 December 2008 its gross Loan Portfolio was USD 781 million and Total Assets were USD 957 million. MiBanco had a Return on Assets of 3 percent and a Debt to Equity ratio of 1,080 percent (according to the MIX Market). Rating information is provided in Spanish on the MIX Market.

A loan of USD 1 million was made in local currency to Proempresa of Peru. Established in 1997 Proempresa offers financial services to small and micro enterprises in Peru. Its objective by 2010 is to reach 100,000 clients with no more than 3 percent default, a return on assets of 4 percent and return on capital of 18 percent. As at the end of 2007 it has over 30,000 active borrowers with an average loan balance of USD 972. Total Assets were USD 32.9 million for the same period and the gross Loan Portfolio was USD 29.5 million. The Return on Assets was 2 percent and Return on Equity 11 percent. Rating information is provided in Spanish on the MIX Market.

FIELCO, Financiera El Comercio, received a USD 1.5 million loan from rAGMF for its Paraguay operations. FIELCO was established in 1976 and operates in Latin America and the Caribbean. At the end of 2008 FIELCO had 67,000 active borrowers and 14,500 savers. Its gross Loan Portfolio was USD 54.7 million and it had Total Assets of USD 73.4 million. Return on Assets was 7 percent for the same period, whilst the Debt to Equity ratio was 549 percent. Rating information, by Fitch Ratings, is provided in Spanish on the MIX Market.

In April 2005 the Global Microfinance Fund (rAGMF) was launched in Luxembourg with the objective of increasing the independence of microentrepreneurs in developing and transition countries. Investors in this fund seek to achieve a financial return through their investment in alleviating poverty. The fund makes diversified investments around the world in microfinance. responsAbility, as the investment advisor, selects suitable MFIs for the fund. At the end of February 2009 rAGMF had Fund Assets of USD 358 million of which USD 284 million were allocated to microfinance investments. It reported 182 active microfinance investments for the same period.

By Sally Levy, Research Assistant

Additional Resources:

responsAbility: Home; Press Release: Launch of the responsAbility Global Microfinance Fund ? creating hope for microentrepreneurs and opportunities for investors

CGAP Microfinance Dealbook: Link

Caritas del Peru: Home

MiBanco of Peru: Home

Proempresa: Home

FIELCO: Home

MIX Market: Caritas; FIELCO; MiBanco; Proempresa: Global Microfinance Fund (rAGMF)