by Radhika Chandrasekhar -

MICROCAPITAL.ORG BRIEF: ACCION International invests $500,000 for 49.5% Equity Stake in Indian Microfinance Institution Saija Finance Pvt Ltd

ACCION International recently invested USD 500,000 for a 49.5 percent equity stake in Saija Finance Pvt Ltd, [4] a microfinance institution (MFI) based in Northern India that started in April 2008. The investment was made through ACCION International’s ACCION Gateway Fund. [3] Saija is the fund’s fourth investment in India. Other recent investments in Indian MFIs include Swadhaar FinServe, [5] which caters to the urban poor, Lok Capital, [6] which serves social enterprises, and United Villages, [7]  which focuses on the rural poor.

by Diya Chopra -

MICROCAPITAL.ORG STORY: Indian Microfinance Sector Sees Increase in Private Equity Investments from $61m to $143m

The Financial Express, a web-based Indian financial news source, said that from January to October of 2009, the Indian microfinance sector has seen a significant growth in private equity (PE) investments. In that time period, eleven PE deals worth USD 143 million were carried out, compared to eight deals worth USD 61 million in the previous year. According to the article, the Indian microfinance sector’s compound annual growth rate (CAGR) has reached 105% [1].

by Christopher Maggio -

MICROFINANCE PAPER WRAP-UP: IFC Reports on Its Activities: Access to Finance (A2F) Highlights Report 2009

Published by IFC, 40 pages, available at: http://www.ifc.org/ifcext/gfm.nsf/AttachmentsByTitle/A2F-HighlightsReport2009/$FILE/A2F-HighlightsReport2009.pdf

The International Financial Corporation, the investment arm of the World Bank, has published its annual Access to Finance Highlights Report for 2009. The report covers the efforts of the IFC to expand and improve financial access. Some of the main highlights include:

by Zoran Stanisljevic -

MEET THE BOSS: Interview with Robert Annibale, Global Director of Citi Microfinance (Part Two of a Two Part Series)

Bob Annibale is Global Director of Citi Microfinance. He leads the bank’s commercial relationships with microfinance institutions, on a multi-business and product basis, providing financing and product partnerships to institutions that serve the poor and the unbanked.

He joined Citibank in 1982. After a first assignment in Greece, he held a number of senior treasury, risk and corporate positions at Citi in Athens, Bahrain, Kenya, London and New York.  Mr. Annibale completed his BA degrees in History and Political Science at Vassar College and his Masters Degree in African Studies (History) at the University of London, School of Oriental and African Studies.

Mr. Annibale served on the Board of Advisors for the United Nations High Level Commission on Legal Empowerment of the Poor. He represents Citi on the Board of the Microfinance Information Exchange, on the Council of Microfinance Equity Funds and with the Microfinance Network. He also serves on a number of other external boards and councils.

by Zoran Stanisljevic -

MEET THE BOSS: Interview with Robert Annibale, Global Director of Citi Microfinance (Part One of a Two Part Series)

Bob Annibale is Global Director of Citi Microfinance. He leads the bank’s commercial relationships with microfinance institutions, on a multi-business and product basis, providing financing and product partnerships to institutions that serve the poor and the unbanked.

He joined Citibank in 1982. After a first assignment in Greece, he held a number of senior treasury, risk and corporate positions at Citi in Athens, Bahrain, Kenya, London and New York.  Mr. Annibale completed his BA degrees in History and Political Science at Vassar College and his Masters Degree in African Studies (History) at the University of London, School of Oriental and African Studies.

Mr. Annibale served on the Board of Advisors for the United Nations High Level Commission on Legal Empowerment of the Poor. He represents Citi on the Board of the Microfinance Information Exchange, on the Council of Microfinance Equity Funds and with the Microfinance Network. He also serves on a number of other external boards and councils.

by Hio Kyeng Lee -

MICROCAPITAL.ORG STORY: Banco Compartamos SA Reports Strong 3Q09 Results Despite Challenging Macroeconomic Conditions

     Despite challenging economic times, Banco Compartamos SA, a microfinance bank located in Mexico City, has reported strong results for third quarter of 2009. Compartamos reported a total loan portfolio of 7,071 million pesos or 548 million USD, or an increase of 40.2 percent from the previous year.[1, 2] The number of new clients reached 1.4 million active clients resulting from an increase of 36.1 percent of new clients over the past year.[1,2] Compartamos states that global macroeconomic environment has not negatively affected client demand.[2, pg.4] The average outstanding loan balance per client increased slightly by 3.1 percent to 4,968 pesos or 385 USD in third quarter of 2009.[2, pg.4] Compartamos’ core product called “Credito Mujer” (group loans) represents 74.2 percent of the total loan portfolio in third quarter of 2009.[2, pg.4] The Bank states that it “restructured the loan origination process in higher risk profile products, establishing stricter policies to avoid over indebting customers.”[2, pg. 4]

by Stefanie Rubin -

MICROCAPITAL.ORG STORY: Banco Compartamos SA Applies for Banking License to Accept Deposits from Clients

Banco Compartamos SA, a publicly traded Mexican bank and the largest microfinance institution (MFI) in Latin America with USD 587.8 million in total assets, plans to apply for a license to expand its banking services [1, 2, 3]. The license will allow the bank to take deposits by offering savings accounts to clients. It will also allow third parties to use the deposits to issue credit to and take interest payments from some of Compartamos´ 1.2 million customers.

by Radhika Chandrasekhar -

MICROFINANCE PAPER WRAP-UP: “Asia – Commercialise Microfinance” by Nicholas Kwan, Kelvin Lau, and Elizabeth Lee from Standard Chartered Bank (Hong Kong) Limited. Released on Aug 31, 2009.

Written by Analysts Nicholas Kwan, Kelvin Lau, and Elizabeth Lee. Released on August 31, 2009 in “On the Ground” through the Standard Chartered Bank (Hong Kong) Limited. Ref: GR_20Jul09

http://www.microfinancegateway.org/gm/document-1.9.37784/Asia%20Commercialise%20Microfinance.pdf

This is a paper written by analysts from the Standard Chartered Bank that describes to the public the role of commercialization in the transformation of the microfinance industry. In this paper, the authors note that though microfinance has been growing in popularity throughout the world in the past few decades, Asia has not maximized its potential in this investment sector. The authors use the term “commercialization” of microfinance to refer to the idea of microfinance institutions (MFIs) becoming very much integrated into the for-profit, business and financial sector, rather than the non-profit, subsidized sector. According to them, especially considering Asia’s growing economy, Asian MFIs are currently well positioned to become more involved in commercialized microfinance and cross-border investment. Many Asian MFIs have begun to further integrate themselves with commercial banks and the financial sector.

by Stefanie Rubin -

MICROCAPITAL.ORG STORY: SKS Microfinance Plans for India’s First Microfinance Institution’s (MFI) Initial Public Offering (IPO), Managed by Citigroup, Credit Suisse and Kotak Mahindra Capital

According to an article in the Financial Times, Hyderabad-based SKS Microfinance, India´s largest microfinance institution (MFI), is taking steps toward becoming the first microfinance institution (MFI) to be listed on Indian stock exchanges. The initial public offering (IPO) could come as early as the start of 2010. Investment firms Citigroup, Credit Suisse and Indian-based Kotak Mahindra Capital will manage the USD 200 to 250 million listing [1].

by Christopher Maggio -

MICROCAPITAL.ORG STORY: Mexican Business Tycoon Carlos Slim Helú’s Carlos Slim Foundation and Grameen Trust Launch “Grameen-Carso”, Mexican Micro-Lending Program With USD 5 Million Donation and USD 40 Million Guaranteed as Credit Line

Mexican entrepreneur Carlos Slim Helú (Carlos Slim), through his charitable Carlos Slim Foundation, has teamed with Grameen Trust, an organization charged with supporting and promoting poverty-alleviating activities, to begin “Grameen-Carso” a micro-lending program in Mexico started with a Carlos Slim Foundation donation of USD 5 million for initial assets, and a guaranteed USD 40 million from the Carlos Slim Foundation as a credit line [3]. The terms and conditions of this credit line have not been disclosed. Grameen Trust will assume a management role for the program, bringing in experienced employees in the field of microfinance from Grameen Bank, the microfinance institution (MFI) whose model Grameen Trust attempts to promote in its ventures [1,3]. The managers will then, in the long term, “capacitate local managers in order to be in charge of procedures in Mexico” [3].

by Christopher Maggio -

MICROCAPITAL.ORG STORY: Citi Microfinance Executive, Robert Annibale, Says Financial Crisis Will Spur Microfinance to Move Toward a Banking Model

The Wall Street Journal Online has reported on the comments of Robert Annibale, global director of Citi Microfinance, the arm of the financial services company dedicated to fostering microfinance through funding and support [1,2]. Mr. Annibale believes that more microfinance institutions (MIFs) will begin to “seek banking licenses to broaden their sources of funding” [1]. He sees the lack of liquidity caused by the financial crisis as creating a situation in which MFIs need “diversified funding” and that deposits are one source that MFIs should draw from. In Mr. Annibale’s opinion, deposits have more stable sources of funding in the financial crisis than “selling debt on the capital markets or loans from public and private sector banks” [1]. As debt and credit markets have slowed down during the financial crisis, these sources of funding have been more difficult to obtain, which Mr. Annibale says has not been the case with deposits [1]. He cites the trajectories of MFIs such as Peru’s MiBanco and Mexico’s Banco Compartamos SA, “which started as non-government organizations and later became banks in order to offer a wider range of products” as being indicative of a greater trend to come in microfinance [1,3,4,5,6].