by Jeffrey Erfe -

MICROCAPITAL EVENT: 2008 Arab Microfinance Investment Symposium

NOVEMBER 30, 2008, DUBAI, UNITED ARAB EMIRATES

The 2008 Arab Microfinance Investment Symposium is a day-long event focusing on microfinance as an emerging asset class and investment opportunities in the Middle East, North Africa and Pakistan.  The symposium will take place on November 30 at the Godolphin Ballroom of the Jumeirah Emirates Towers in Dubai, United Arab Emirates (UAE), and it will be co-hosted by Grameen-Jameel, a social-oriented business based in Dubai, and BlueOrchard, a microfinance investment manager located in Geneva, Switzerland.  Aramex and the International Finance Corporation (IFC) have signed on as sponsors.   The symposium has been marketed to asset managers, bankers, high net-worth individuals, family businesses and other interested investors. 

by Scott Everett -

MICROCAPITAL STORY: Microfinance Institution ACCION International Launches New Hub in Africa

ACCION International, a microfinance organization founded in 1961, launched a new hub office and training center in Accra, Ghana, with the aim to expand financial services for Africa’s poorest populations. The new center will offer support to East and West African microfinance institutions (MFIs) in the form of education and training to increase capacity. According to the press release, ACCION’s goals are to train 3,000 microfinance practitioners in such disciplines as business planning, risk management, lending and governance; all through its training center network.

by Jeffrey Erfe -

MICROCAPITAL STORY: Citigroup Opens Two Micro-Credit Firms in China Following Recent Rural Banking Initiatives by HSBC Holdings and Standard Chartered in the Region

In early October, Citigroup Inc, a New York-based multinational financial services firm, announced that the China Banking Regulatory Commission (CBRC), a Chinese government agency responsible for regulating the banking sector, approved Citigroup’s plan to open two micro-credit firms in Hubei, a rural province in China. The two institutions will be established in Gong’an county and Chibi city sometime in the next few months.  China Daily implied that Citigroup’s move is meant to compete with the Chinese rural banking outlets of two London-based international banks, HSBC Holdings and Standard Chartered, in China’s financially underdeveloped regions.

by Lori Curtis -

MICROCAPITAL STORY: FMO Invests $10 Million in Sri Lankan LOLC Micro Finance Company

Sri Lankan company Lanka ORIX Leasing Company PLC (LOLC) will launch LOLC Micro Finance Company (LOLC MF) with a USD 10 million loan and equity injection from the Netherlands Development Finance Company (FMO). FMO is investing USD 2 million in equity, USD 1.5 million as a convertible loan and USD 6.5 million as a senior loan. FMO will own 20 percent of LOLC MF. This will be the first Sri Lankan microfinance institution (MFI) to have foreign shareholding. LOLC MF already has a Rs 2.3 billion (USD 21.2 million) loan portfolio which has a non-performing loan ratio on a portfolio-of-risk basis of around 5 percent.

by Jeffrey Erfe -

MICROCAPITAL PAPER WRAP-UP: Islamic Microfinance: An Emerging Market Niche, by Nimrah Karim, Michael Tarazi and Xavier Reille

Written by Nimrah Karim, Michael Tarazi and Xavier Reille and based primarily on secondary research by the Consultative Group to Assist the Poor (CGAP), released in August 2008 as Number 49 of Focus Note, a publication of CGAP, 16 pages, available on October 27, 2008 at: http://www2.cgap.org/gm/document-1.9.5029/FocusNote_49.pdf.

by Lori Curtis -

MICROCAPITAL STORY: Cambodian Credit Bureau To Be Launched for Regulating Banking and Microfinance

Regulators in Cambodia are planning the creation of the nation’s first credit bureau to link the country into a national financial database, it was reported in the Phnom Penh Post. The credit bureau would act as a registry for the details of all loans which would be submitted by microfinance institutions (MFIs) in Cambodia. While the report did not specify which authorities will launch the credit bureau, The International Finance Corp, a member of the World Bank Group, and the National Bank of Cambodia, Cambodia’s Central Bank, made statements regarding the need for the bureau and the desired date for the launch, which is in April 2010, while Angkor Microfinance Kampuchea (AMK) and ACLEDA Bank also spoke about the benefits of regulation in the microfinance sector. The motivation for the creation of a credit bureau has been brought on by the global credit crisis as its effects expand to Cambodia, combined with the rapidly growing banking sector.

by Jeffrey Erfe -

MICROCAPITAL STORY: Micro-Lender Letshego Holdings Limited (Micro Provident) Seeks $137.7m in Capital for Expansion of African Operations

Letshego Holdings Limited, a micro-lending company based in Botswana, announced on October 10 that it intends to raise USD 137.7 million (BWP 1 billion) in debt instruments in order to fund the expansion of its micro-lending operations across Africa. Target countries in the short to medium term include: Ghana, Mozambique and Namibia. Over 80 percent of shareholders—excluding the World Bank and the International Finance Corporation (IFC)—voted to approve the move at a special general meeting in Gaborone, Botswana.

by Jeffrey Erfe -

MICROCAPITAL STORY: World Bank Group Publishes Online Database of Global Remittance Prices to Improve Price Transparency in Remittance Provision Markets

The World Bank Group recently published a publicly-available online database of global remittance prices in 120 “country corridors” (i.e. two countries between which remittances are transferred) with the aim of informing low-income migrant workers and households in emerging economies.   While global leaders have talked about reducing remittance-sending costs for some time, little has been done on the issue in the way of substantial quantitative data until now, says remittances specialist Dilip Ratha.    

by Lori Curtis -

MICROCAPITAL STORY: Relaxed Credit Controls in China May Open Market Opportunities for Microfinance

A number of manufacturing bankruptcies and recent relaxations of credit controls by the Chinese government may allow microcredit lenders to emerge to play a bigger part in the Chinese Economy, according to The China Daily. With the recent bankruptcies by small to medium manufacturing companies in the Pearl River Delta and the jobs lost as a result of this, financial experts are looking to the restrictions on lending in China. Experts including Wu Xiaoling, vice-chairwoman of the Financial and Economic Committee of the National People’s Congress and Xu Xiaonian, a professor of economics and finance at the China Europe International Business School both spoke recently about the importance of private financing for enterprises as opposed to large, state-run banks.

by Greg Casey -

MICROFINANCE EVENT: Global Summit on Microfinance as an Alternate Asset Class for Institutional Investors

GLOBAL SUMMIT ON MICROFINANCE AS AN ALTERNATIVE ASSET CLASS FOR INSTITUTIONAL INVESTORS

OCTOBER 29-30, MILLENIUM KNIGHTSBRIDGE HOTEL, LONDON, ENGLAND

The conference will focus on the opportunities and challenges for microfinance investments as the industry becomes larger and converges with mainstream financial institutions. Specific topics will include the current state of the microfinance sector, the risks and rewards for institutional investors involved in microfinance, an evaluation of rating metrics currently employed, lessons and opportunities taken from other asset classes, good governance in microfinance institutions (MFIs), and developing a universal framework for evaluating social returns. A complete agenda can be found of the conference website.