The Foundation for International Community Assistance (FINCA) Azerbajian received 2 separate loans for $500,000 and $400,000 from the responsAbility Global Microfinance Fund. FINCA Azerbaijan is part of the FINCA International network, which developed the village banking method of microfinance which emphasizes the formation of community-based credit and savings associations. FINCA was incorporated in 1985 and expanded its activities beyond Latin America to Central Asia with the establishment of FINCA Kyrgyzstan in 1995. FINCA Azerbaijan was established in 1998.

Continue reading “responsAbility Global Microfinance Fund Makes Debt Investment Totaling USD $900,000 in FINCA Azerbaijan”

Microfinance Institution (MFI) Prizma received a EUR 1 million (USD $1.02 million) loan from Impulse Microfinance Investment Fund. Prizma is a non-bank financial institution established in 1997, with 5 branch offices and 35 satellite offices across Bosnia & Herzegovina. It reports an outstanding loan portfolio of 20.96 million km (USD $13.57 million), with an average loan balance of $731. It recently received loans totaling EUR 1 million from the Triodos-Doen fund.

Continue reading “Impulse Microfinance Investment Fund Loans 1 Million Euros to Prizma in Bosnia & Herzegovina”

The Kazakhstan Loan Fund (KLF), an NGO working to provide financing to small-scale entrepreneurs throughout Kazakhstan, recently received a series of loans from a number of Microfinance Investment funds. Founded in 1997, KLF had 16,436 active borrowers at the end of 2005, with a gross loan portfolio of $11.2 million out of $14.4 million in total assets. Return on assets was 8.98%. Total Equity was reported at $5.02 million, with a debt to equity ratio of 186.73%.

Continue reading “Thanks to a Series of Microfinance Investments from Oikocredit, Triodos-Doen & Hivos-Triodos, Dignity Fund and Microvest, Kazakhstan Loan Fund Receives $4.38 Million”

Alter Modus, an NGO based in Serbia & Montenegro, recently received a loan from the Triodos-Doen Foundation for EUR 300,000, or US$384,150. This is in addition to a loan worth $244,800 issued earlier this year. (See Microcapital Blog 3/3/06).

Continue reading “Alter Modus of Serbia & Montenegro Accepts an Additional $384,150 in Microfinance Investment from Triodos-Doen”

Oikocredit’s latest round of microfinance investments has included several loans to microcredit organizations in Eastern Europe. Founded in 1975, Oikocredit is one of the larger microfinance investment funds, reporting total assets of $304 million as of year-end of 2005. $126 million of this is allocated to Microfinance Investments.

Continue reading “Constanta Foundation of Georgia, FINCA Armenia, and Romania’s CAPA Finance Societate de Microfinantare SA Benefit from Oikocredit’s Microfinance Investments in Eastern Europe”

Mobiasbanca, the fifth largest private bank in Moldova, was extended a credit line of 2.4 million euros (USD $3.07 million) by the European Bank for Reconstruction & Development (EBRD) as part of its Moldovan Microfinance Framework (MMF). MMF is a $25 million facility providing funds for local banks to lend to micro and small enterprises.

Continue reading “The European Bank for Reconstruction & Development Supports Microfinance in Moldova with 2.4 million euro Credit Line Extension to Mobiasbanca”

MI-BOSPO of Bosnia & Herzegovina, received a EUR 1 million (US$1.28 million) loan repayable in 5 years from Oikocredit. Founded in 1996, MI-BOSPO is a microcredit organization which aims at providing financial services to women entrepreneurs. According to MIX Market, year-end 2004 figures indicated a $9.4 million gross loan portfolio made up of 9,206 active borrowers. Total assets were $11.4 million. With $4.3 million in total equity, the return was 17.83% and debt to equity ratio was 164.07%.

Continue reading “Oikocredit Microcredit Investments Extend to Eastern Europe; MI-BOSPO Receives $1.28 Million Loan”

The United States National Nuclear Security Administration reported that it has removed 139 pounds of weapons-grade nuclear material from and Uzbekistan reactor to a secure storage site in Russia. This move was atypical of U.S. åö Uzbekistan relations; the two have been at odds since last year when Uzbek forces opened fire on antigovernment demonstrators in the northeastern part of the country.

Interestingly, cooperation in the matter came about after a concerted humanitarian effort by the United States. In the past year, USAID has been responsible for approximately US$4 million in health programs in Uzbekistan; and US$2 million in economic aid targeting microcredit for small businesses.

1) New York Times: “Uzbeks Ship Bomb-Grade Waste to Russia,” April 20, 2006.
2) USAID
3) MicroCapital Blog: “Microfinance Investments Seen as a Cornerstone in the Rebuilding of Iraq- USAID Laying the Foundations for Growth,” April 20, 2006.

Headquartered in Zurich, Credit Suisse is a financial services institution providing investment banking, private banking and asset management services to clients in more than 50 countries. At the end of 2005, Credit Suisse reported total assets just over $1 trillion and return on equity (ROE) of 15.4%.

In 2003, Credit Suisse co-founded the responsAbility Global Microfinance Fund along with Raiffeisen Banking Group, Baumann & Cie Banquiers, and the Andromeda Fund. This fund provides investors with a combination of moderate financial returns coupled with social benefits. responsAbility loans between $50,000 and $1.5 million to MFIs for a maximum of 5 years at a rate equal to “LIBOR plus full cost plus full risk.” As of March 31, 2006 the fund’s total assets reached $50 million with over $45 million allocated to microfinance investments. In addition, investment advisory services to the responsAbility Fund are provided by BlueOrchard, IPC/ProCredit, FINCA International, Symbiotics, Opportunity International, and PlaNet Finance.

Additional Resources
1. ING “A Billion to Gain? A study on global financial institutions and microfinance,” February, 2006
2. ResponsAbility
3. MIX Market: “responsAbility”4. MIcrocapital Blog: “Best in Class Just Keeps Getting Better: Swiss responsAbility Microfinance Investment Fund Lends $1,755,095 to German ProCredit Holding.” February 16, 20065. Microcapital Blog: “Microfinance Investment Funds Ranked by Size and Microcredit Allocation” January 13, 20066. Microcapital Blog: “ResponsAbility Global Microfinance Fund Investing More than $7m in 11 Microfinance Institutions in Jordan, Benin, Ecuador, Nicaragua, Bosnia and Herzegovina, and Peru” January 6, 2006
7. Credit Suisse

Yesterday, MicroCapital reported on increased investment commitments by the major shareholders of ProCredit Bank Romania. Today’s financial report by the bank affirms the investors’ decision as a strong play. The bank posted a profit of å¥1.75 million over 2005, a solid recovery from its 2004 losses. In addition, the bank grew total deposits by 157% and assets totaled å¥128.85 million. The lending business also expanded significantly with a 259% increase in farm credits. Finally, the bank plans to vastly increase its outreach over the coming year, adding 30 new branches to the 17 already in existence.

1) Reporter.gr “Romania: ProCredit Posts ’05 Net Profit Over å¥1.75mn,” March 22, 2006.
2) Reporter.gr: “Romania: ProCredit Bank Raises Share Capital by å¥4mn,” March 20, 2006.
3) MIXMarket Profile: ProCredit Bank Romania
4) ProCredit Holdings
5) MicroCapital Blog: “Major Shareholders ProCredit Holdings, Commerzbank, and European Bank for Reconstruction and Development Increase Equity Investment in Microfinance Institution, ProCredit Romania,” March 21, 2006.

MicroCapital recently reported on a US$750,000 debt investment made by the Triodos-Doen Fund in FINCA Mexico, but recent financial reports from Eastern European and Central Asian FINCA organizations show that the growth of these microfinance institutions is by no means limited by geography. FINCA, which stands for the Foundation for International Community Assistance, is a global network of microfinance institutions that leverage the “Village Banking” methodology, a microfinance program that encourages community responsibility for financial services.
Continue reading “FINCA Microfinance Institutions in Azerbaijan, Tajikistan, Georgia, and Armenia Growing Rapidly on the Heels of New Investments”

The European Bank for Reconstruction & Development was established in 1991 to enable growth of the private sector in Eastern Europe after the fall of Communism. The Bank uses tools of investment to help build market economies and democracies in twenty-seven countries. The Bank is owned by member / shareholder countries with over å¥20 billion in subscribed capital and maintains a AAA credit rating.

The European Bank for Reconstruction & Development made its first-ever local currency loan to the Kazakhstan Loan Fund. The KZT 267.14 million loan (approximately US$2 million) will develop on-lending across the fund’s product base that includes Business Loan Group solidarity loans, individual loans, and group consumer lending. The Kazakhstan Loan Fund has been a presence in European microfinance for 9 years now. With a gross loan portfolio of US$6,154,594 and total assets of US$7,231,359, the fund created a return on assets of 7.20% over 2004. By January of 2006, that loan portfolio had grown to US$11.6 million.
Continue reading “European Bank for Reconstruction & Development Backs Alter Modus of Montenegro, Kazakhstan Loan Fund, and Moldovan Rural Finance Corporation with New Microcredit Investments”

Kfw, a German development bank established in 1948 to support small and medium-sized enterprises (SMEs) and start-ups is providing a $5 million loan to the Microfinance Bank of Azerbaijan (MFBA). Kfw, one of the ten largest banks in Germany and a historically strong partner to the microfinance industry, had å¥341 billion in total assets at the close of 2005. Recently, the group participated in a å¥30 million equity financing with the World Bank that established the Southeast Europe Microfinance Fund. See the January 10, 2006 blog for more information on this deal.

MFBA was established in 2002 by four shareholders: European Bank for Reconstruction and Development (EBRD), International Finance Corporation (IFC), Black Sea Trade and Development Bank (BSTDB) and LFS Financial Systems GmbH (LFS). In December of 2004, KfW became the fifth shareholder. Based upon information released earlier this month, MFBA enjoyed a strong financial performance in 2005. Since inception, the organization has disbursed 18,825 loans, with 9,608 loans disbursed in 2005 alone. Also, MFBA’s credit portfolio nearly tripled in 2005 and reached $17.5 million, 169% greater than portfolio indicators for January 01, 2005. The Bank’s assets grew substantially in 2005, reaching $22.4 million – up from $9.3 million in 2004.

Continue reading “German Development Bank KFW makes $5 Million Microfinance Investment in Microfinance Bank of Azerbaijan”

The responsAbility Global Microfinance Fund, ProCredit’s first private investor, augmented its stake in the holding company with loan of $1,755,095. Information on the duration of the loan is not publicly available.

Swiss-based ResponsAbility Global Microfinance Fund was founded in 2003 by Swiss financial institutions Credit Suisse, which is also the fund manager, Raiffeisen Banking Group, Baumann & Cie Banquiers, and the Andromeda Fund. Investment advisory services to the ResponsAbility Fund are provided by: Alterfin, BlueOrchard Finance, IPC/ProCredit Holding, FINCA International, Symbiotics, Opportunity International, and PlaNet Finance. ResponsAbility loans between $50,000 and $1.5 million to MFIs for a maximum of 5 years at a rate equal to “LIBOR plus full cost plus full risk.” The Fund’s total assets amounted to just over $45 million as of January 2006 with over $43 million allocated to microfinance investments.

Established in 1998 as the leader and main shareholder of the ProCredit Group, which consists of 19 microbanks with microcredit programs in different countries, ProCredit Holding controls its subsidiaries closely, their website stressing investment in training and professional development. The ProCredit group had approximately å¥1.9 billion in total assets and a total loan portfolio of å¥1.3 billion as of October 2005. To date, the 19 microbanks have made about 526,000 loans to microentrepreneurs and small businesses, approximately 90% of which are under å¥10,000 and about 50% of which are below å¥1,000. ProCredit Holding reports its Return on Average Assets as of December 2004 2.4% and its Return on Average Equity as 19.5 %. ProCredit continues to distant itself from the micro-bank pack.

Established in 2002 by the European Bank for Reconstruction and Development (EBRD), International Finance Corporation (IFC), Black Sea Trade and Development Bank, and German LFS Financial Systems GmbH, AMFB provides financial services to micro and small business within the country. The bank’s typical microloans are between $400 and $10,000 for a maximum of 9 months. In June 2005, the Azerbaijan Microfinance Association reported that AMFB had a total loan portfolio of more than $11.4 million. It is the only one of the 45 commercial banks in Azerbaijan that focuses on microfinance services. AMFB does not report to the MIX Market, the World Bank’s microfinance information clearinghouse. Further information about their performance is not publicly available.

Established in 1992, Incofin invests in MFIs in 14 countries, and in mid-2005 had total assets of $5.6 million. The duration of Incofin’s loans, which are between $120,000 and $600,000, is five years, and the terms offered are “LIBOR plus full cost plus full risk”. At the end of 2004, Incofin, along with KBC, Boerenbond, VDK Spaarbank, Volksvermogen (Belgian institutional investors) set up the Impulse Microfinance Investment Fund, which had initial capital of å¥5 million. By mid-2005, the fund’s assets were worth $15,413,875. The fund invests between $300,000 and $1.5 million in MFIs, and offers the same terms as Incofin.

Amidst a rising tide of investment in emerging markets, The International Finance Corporation has agreed to provide a US$2.2 million financing package to Micro Credit Agency Bai Tushum Financial Foundation (BTFF). The investment is being made in the form of a US$1.2 million loan with an option for the IFC to convert a portion of the loan into a US$1 million dollar equity stake in the MFI.
Continue reading “Microcredit Lender Converts on New Debt Investment”

The World Bank Group’s private sector arm, the International Finance Corporation (IFC) will invest å¥20 million in mezzanine “B” shares with a 10-year maturity and å¥10 million in senior “A” shares with a seven-year maturity, in the soon to be established European Fund for Southeast Europe (EFSE), which will eventually lend to banks and microfinance institutions (MFIs). The IFC’s stake is approximately 21% of the fund’s initial capitalization of å¥142 million. To reach its target of a å¥500 million capitalization within five years, EFSE expects to attract capital from multilateral and private institutional investors via multiple closings in the future. EFSE is expected to be the largest microfinance fund in Southeast Europe.
Continue reading “World Bank Investing å¥30m of Equity in Microfinance Together with German Development Bank KfW to Establish “Southeast Europe Microfinance Fund” with an Expected Final Capitalization of å¥500m”

Belgium investment company Incofin has invested å¥250,000 in Ecuadorian microfinance institution (MFI) Fundación ESPOIR, while Incofin’s Impulse Microfinance Investment Fund has invested å¥1 million in FINCA Kosovo, and å¥500,000 into Peruvian MFI EDPYME Confianza.
Continue reading “Belgian Investment Company Incofin Invests Over å¥1.5 Million in Three Microfinance Institutions (Fundación ESPOIR, FINCA Kosovo, EDPYME Confianza)”