MICROCAPITAL BRIEF: BlueOrchard Makes First Direct Loan of $5m to Microfinance Network FINCA International

BlueOrchard Finance SA, a subsidiary of Switzerland-based microfinance investment company BlueOrchard, recently made a debt investment of USD 5 million in FINCA International, a US-based microfinance network, through its Dexia Microcredit Fund, one of the microfinance investment vehicles BlueOrchard manages. The debt issue marks the first loan that BlueOrchard has made directly to FINCA International, although it has previously invested in FINCA’s affiliate microfinance institutions (MFIs). Ms Maria Teresa Zappia, a managing director at BlueOrchard, describes the transaction as “a great opportunity to support the growth and long-term sustainability of the FINCA network, as well as a strategic means to increase the outreach of BlueOrchard Finance impact investing globally.” BlueOrchard had approximately USD 1.1 billion under management as of April 2011. As of 2009, FINCA had total assets of USD 467 million, with operations in 21 countries.

By Jacqueline Foelster, Research Associate

About BlueOrchard: BlueOrchard is a Switzerland-based, commercial microfinance intermediary that provides loans to microfinance institutions through its subsidiary BlueOrchard Finance S.A. and invests in the equity of microfinance institutions and microfinance network funds through its subsidiary BlueOrchard Investments S.A. BlueOrchard had approximately USD 1.1 billion under management as of April 2011.

About Dexia Microcredit Fund (DMCF): DMCF invests in debt instruments issued by microfinance institutions (MFIs). DMCF finances 88 institutions in 33 developing countries in Africa, Asia, Eastern and Central Europe and Latin America. DMCF is managed by BlueOrchard Finance SA and is also certified by the Luxembourg Fund Labeling Agency (LuxFLAG), an organization that investigates whether microfinance investment vehicles actually support the microfinance sector.

About FINCA International: Founded in 1984 by Dr John Hatch, a pioneer of the village banking model, the Foundation for International Community Assistance (FINCA) International is a global microfinance network based in Washington, DC, serving approximately 700,000 people through its subsidiaries in 21 countries. As of 2009, it had total assets of USD 467 million, with an operating profit of USD 742,000.

Source and Additional Resources:

[1] Press release submitted by BlueOrchard to MicroCapital, April 12, 2011, “BlueOrchard Finance SA strengthens its partnership with FINCA International”

MicroCapital.org Brief, April 4, 2011, “Microfinance Investment Vehicle BlueOrchard Private Equity Fund Completes First Distribution to Investors of $7.5m”, https://www.microcapital.org/microcapital-brief-microfinance-investment-vehicle-blueorchard-private-equity-fund-completes-first-distribution-to-investors-of-7-5m/

MicroCapital Universe Profile: BlueOrchard, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=BlueOrchard

MicroCapital Universe Profile: Dexia Microcredit Fund, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Dexia+Microcredit+Fund+%28DMCF%29

MicroCapital Universe Profile: FINCA International, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=FINCA+International

Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/

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