Source: Financial Times.
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MICROCAPITAL STORY: Meet a MicroBank: An Interview with Managers of First Microfinance Bank (FMFB) of Afghanistan, Member of Aga Khan Development Network (AKDN)
The Aga Khan Development Network (AKDN) focuses on health, education, culture, rural development, institution-building and the promotion of economic development. It is dedicated to improving living conditions and opportunities for the poor. In Afghanistan, AKDN’s projects include large-scale rural development, health, education and civil society programs. Through one of its nine operating agencies, the Aga Khan Agency for Microfinance (AKAM) also provides microfinance services in the rehabilitation of historic neighborhoods in Kabul and Herat. A key product development priority for AKAM began in 2007 with the development of the Housing Product Initiatives program in Afghanistan, via the First MicroFinance Bank (FMFB) of Afghanistan with additional assistance from the International Finance Corporation (IFC), a member of the World Bank Group.
MICROCAPITAL STORY: Hyderbad-based Spandana Microfinance Seeks to Raise Rs 300 Crore (USD 63.7 million) by June
According to a press release in The Economic Times of India, Spandana Sphoorty Financial Ltd. is set to raise Rs. 300 Crore (USD 63.7 million) in equity funding and is currently in talks with over two dozen investors. The deal would raise the company’s valuation to Rs. 1,800 Crore (USD 382.2 million). Spandana intends to use the funds to expand and strengthen its capital adequacy ratio. The Reserve Bank of India (RBI) raised its capital adequacy requirements (CRAR) for non-bank financial institutions last August, requiring institutions to meet a 12 percent CRAR by April 2009 and a 15 percent CRAR by April 2010. Spandana’s CRAR stood at 19.5 percent last fiscal year. To read a MicroCapital story on the RBI’s new regulations, click here. Currently Mumbai-based JM Financial holds an 18 percent stake in the microfinance institution, private equity fund Valiant holds 11 percent, Lok Capital has a 5 percent stake and another 15 percent is held by senior employees, with this round of funding their stakes will be diluted.
MICROCAPITAL STORY: PlaNet Finance UAE to Launch Microfinance Institution in Oman
PlaNet Finance United Arab Emirates (PlaNet Finance UAE), a unit of the France-based microfinance support organization the PlaNet Finance Group, plans to launch a microfinance institution (MFI) in the Sultanate of Oman. The MFI, a joint stock company, is also supported by the Oman-based Ajit Khimji Group, MB Holding Company, and the private philanthropist Mr. Samir Fancy. The Omani Ministry of Social Development is also supporting the project. The as-yet-unnamed MFI is currently referred to by PlaNet Finance as the “Greenfield MFI”, “Greenfield” being the generic term for new business ventures. Information on the ownership of the MFI is not yet available. PlaNet Finance UAE is currently working on the legal structure of the MFI. The MFI needs an initial investment fof USD 3.4 million and a USD 15 million concessionary and commercial loan for three to five years to finance portfolio growh. There are donors who have approved the business plan of the new MFI, but amount of current investment and the amount committed by each donor is not publicized. Once established, the MFI will offer one-year loans between USD 800 and USD 4,000.
MICROCAPITAL STORY: Conference Discusses Scope of Microfinance Market in Lebanon
A conference on the challenges of microfinance in Lebanon was recently held at Beirut’s Haigazian University, The general manager of microfinance institution (MFI) Ameen, Ziad Halabi remarked, “….only 28.4 percent of the market has been served, so we still have a gap of 71.6 percent in the market.” According to a 2008 study published by the International Finance Corporation (IFC) and Grameen Jameel Pan Arab Microfinance Ltd., microfinance in Lebanon has a potential customer base of 190,000 clients. Mr. Halabi added that Ameen grew 40 percent in 2008, adding 35 staff members and that 1,000 more staff is necessary to reach the potential clients.
MICROCAPITAL STORY: European Fund for Southeast Europe (EFSE) Provides EUR 20m Loan to Serbia’s Komercijalna Banka
The European Fund for Southeast Europe (EFSE) has announced a EUR 20 million loan to Komercijalna Banka to further expand its outreach to micro and small enterprises (MSEs) in Serbia. The loan brings EFSE’s total investment portfolio in Southeast Europe to EUR 551 million.
MICROCAPITAL STORY: World Bank Micro, Small and Medium Enterprise (MSME) Project in Ghana Disburses $3.2m for Year Ended June 2008; Total Project Value $118.9m
The World Bank, an international quasi-public bank, has committed USD 118.9 million to its Micro, Small and Medium Enterprise (MSME) project in Ghana. For the year ended June 2008 USD 3.21 million had been disbursed. The purpose of the project is to promote entrepreneurial activities within MSME as it comprises almost 70 percent of the Ghanaian workforce. The World Bank’s Country Director for Ghana, Mats Karlsson, has said: “Growth and employment in Ghana are directly linked to the growth of MSMEs …. Ghanaian banks will be more able to link up to Ghanaian businesses for more investment and private sector jobs.” The project will be administered by local World Bank staff.
MICROFINANCE EVENT: XII FOROMIC 2009: Inter-American Forum on Microenterprise
Microfinance Event: XII FOROMIC 2009: Inter-American Forum on Microenterprise
FOROMIC 2009: Inter-American Forum on Microenterprise, September 30 – October 2, 2009, Arequipa, Peru, Sponsored by the Multilateral Investment Fund, Organized by the Inter-American Development Bank
See Our Comprehensive Event Calendar Here: http://microfinanceassociation.ning.com/events
MICROFINANCE EVENT: Second Annual Microfinance Investment Summit, October 6-7, 2009, London, United Kingdom, Sponsored by Incofin
Microfinance Event: Second Annual Microfinance Investment Summit, October 6-7, 2009, London United Kingdom, Sponsored by Incofin
Second Annual Microfinance Investment Summit, October 6-7, 2009, London, United Kingdom, Sponsored by Incofin
See Our Comprehensive Event Calendar Here: http://microfinanceassociation.ning.com/events
PAPER WRAP-UP: Microfinance Funds Continue to Grow Despite the Crisis, by the Consultative Group to Assist the Poor (CGAP)
By Xavier Reille and Jasmina Glisovic-Mezieres, CGAP, with research assistance from Yannis Berthouzoz, Symbiotics, published by Consultative Group to Assist the Poor (CGAP), April 2009, CGAP Brief, 4 pages, available at:
http://www.cgap.org/gm/document-1.9.34437/CGAP%20Brief_MIV_FinancialCrisis.pdf
MICROCAPITAL STORY: African Development Bank Group, Agence Française de Développement Group, European Investment Bank, Development Bank of Southern Africa, KfW Bankengruppe, Islamic Development Bank Group, and World Bank Group Launch USD 15bn Joint Action Plan for Africa Including Support for Microfinance Programs
Seven international financial institutions (IFIs) and development finance institutions (DFIs) have announced a Joint IFI/DFI Action Plan to respond to the Financial Crisis in Africa (Joint Action Plan). In a communiqué signed at the annual meeting of the African Development Bank Group (AfDB) in Dakar, Senegal, the organizations jointly pledged to increase commitments by at least USD 15 billion in the next two to three years. Among goals such as promoting trade and increasing funding for infrastructure and agribusiness, the Joint Action Plan also allocates significant funding to strengthen the financial sector and support micro, small and medium enterprises in the region affected by the global economic slowdown.
MICROCAPITAL STORY: International Finance Corporation Helps ACDI/VOCA’s CredAgro in Azerbaijan Improve Corporate Governance
The International Finance Corporation (IFC), a member of the World Bank Group, announced on its website that Azerbaijani microfinance institution CredAgro, will join the IFC’s Azerbaijani Corporate Governance Project. As part of the program IFC will advise and train directors, managers, and key shareholders of the institution. IFC will also help revise corporate documents, improve financial reporting and information disclosure, internal control, and internal audit functions.
MICROFINANCE EVENT: 2nd Annual Microfinance Investment Summit October 6th & 7th 2009, London, UK
Event Name: 2nd Annual Microfinance Investment Summit
Event Description: The conference will provide an opportunity to discuss, debate and learn about critical microfinance investment issues, ensuring the industry’s survival and its continued sustainable growth in the current economic climate. It will bring together microfinance stakeholders from institutional and private investors, the donor community, microfinance institutions (MFIs) and industry experts.
See Our Comprehensive Event Calendar Here: http://microfinanceassociation.ning.com/events
Cost: Starting from £1,099 (plus 15% VAT). Each additional workshop £399 (plus 15% VAT). Discounts available for non-profits and group bookings.
MICROCAPITAL STORY: World Bank and Federal Government of Nigeria Approve USD 8.4 million in Grants for Microfinance Institutions ACCION Microfinance Bank (AMfB), Susu Microfinance Bank, LFS, MIC Microfinance Bank, Integrated Microfinance Bank (IMFB) and Micro Credit
The Nigerian Federal Government and the World Bank have approved grants totaling USD 8.4 million for six Nigerian microfinance institutions (MFIs). The Executive Secretary of the Nigerian Investment Promotion Commission (NIPC), Mr. Mustafa Bello, made the announcement at the Business Development Services (BDS) Fair, organized by the World Bank’s Micro, Small and Medium Enterprises Project (MSME) in Lagos. The six MFIs are ACCION Microfinance Bank (AMfB), Susu Microfinance Bank, Integrated Microfinance Bank Ltd. (IMFB), MIC Microfinance Bank, LFS, and MicroCredit. No breakdown of the grant money between the MFI’s or what it was to be used for was available.
MICROCAPITAL STORY: Symbiotics Partners with Luxembourg Labelling Agency (LuxFLAG) and Spins Off Luxembourg Consulting Arm to Innpact Sàrl
Symbiotics SA, the Geneva-based investment advisor and information resource for the microfinance industry, has announced a collaboration with the Luxembourg Fund Labelling Agency (LuxFLAG). In an unrelated event, Symbiotics spins-off its Luxembourg consulting arm into an independent company, Innpact Sàrl.
MICROCAPITAL STORY: Islamic Development Bank (IDB) Grants $10m Loan to the Development and Employment Fund (DEF) of Jordan
The Islamic Development Bank (IDB) has extended a USD 10 million soft loan to the Development and Employment Fund (DEF) in Jordan to develop microfinance in the country. The IDB consists of 56 countries that are all members of the Organization of the Islamic Conference and contribute to the bank’s capital. In addition to facilitating trade among member countries, the IDB grants loans and provides funding for social and economic development projects in member countries. Because the financial operations of the IDB are intended to be consistent with Shariah law, the IDB also provides technical assistance and training in Shariah banking practices. For more information on the how Shariah law affects banking practices in general and microfinance in particular, see this MicroCapital Paper Wrap-Up. The IDB was founded at the Conference of Finance Ministers of Muslim Countries in Jeddah in December 1973 and commenced operations in October 1975. The DEF is a public government fund that commenced operations in 1991 with the objective of promoting independent employment and developing the small business sector. Initially under the government’s Industrial Development Bank, the DEF has been independently managed since 1992.
MICROCAPITAL STORY: Microfinance Boosts Lending Portfolio of Sri Lanka’s LB Finance by 40 Percent
According to a report in the Sri Lankan Daily Mirror, LB Finance has announced that 40 percent of its disbursements for the fiscal year ending March 31, 2009 were in microfinance. The significant portion of its disbursements to microfinance resulted partly from its increased focus on micro-leasing of three-wheeler vehicles and agricultural equipment to the informal economy, as well as an expansion to more remote areas of Sri Lanka where there are limited financial services.
MICROCAPITAL STORY: European Development Finance Institutions Part 3: The Netherlands Development Finance Company (FMO) Invests Over USD 160 million in Microfinance in Last Two Years
The Netherlands Development Finance Company (FMO), founded by the Dutch government in 1970 to support the private sector in developing countries, invests in microfinance as a way to stimulate sustainable economic growth. Between January 2007 and March 2009, FMO has invested at least USD 160 million in microfinance services around the world.