Compartamos Banco, a Mexican microfinance bank founded in 1990, is in the process of finding a Latin American microfinance lender to acquire. Fernando Alvarez Toca, the Chief Executive Officer of Compartamos Banco, stated that his company is planning to acquire a Latin American company in accordance with their plan for rapid expansion. Alvarez Toca names Colombia, Peru and Brazil as the primary countries they are investigating [1]. Compartamos Banco has been pursuing this avenue since November of 2009 [2].Such an acquisition would allow Compartamos Banco swifter growth elsewhere in Latin America. For example, Brazil’s GDP is forecast to grow 5 percent in 2010, while Mexico’s is forecast to grow 2.9 percent [2].

A recent acquisition was made in late February of 2010, Financiera Indepenencia, a Mexican microfinance institution focusing on urban lending to individuals, closed a MXP 530 million (USD 41 million) deal to acquire Financiera Finsol, a Mexican MFI focusing on rural group lending [3].

By Matthew Castner, Research Assistant

Compartamos Banco:

Compartamos Banco is a microfinance bank based in Mexico. It was founded in 1990. It offers both group and individual loans in rural and urban areas. Compartamos Banco provides small loans to low-income Mexican individuals and business owners, such as craft manufacturers, food vendors and other small businesses. It also offers voluntary savings, insurance, and loans specifically for home improvement. The company made its initial public offering (IPO) in 2007 on the New York and Mexican stock exchanges in a transaction worth USD 467 million, and, as of December 31, 2009, has a total loan portfolio of MXN 7.6 billion (the equivalent of USD 591 million).

About Financiera Independencia:

Founded in 1993, Financiera Independencia is a Mexican microfinance institution traded on the Mexican Stock Exchange (BMV: FINDEP). As of September 2009, Financiera Independencia had a total outstanding loan balance of USD 371.2 million (MXP 4,793.1 million) and operated in 198 offices in 143 cities in 31 of Mexico’s 32 federal entities.

About Financiera Finsol:

Founded in 2003, Financiera Finsol operates 158 branches in 29 of 32 federal entities in Mexico. It has a total outstanding loan balance of USD 49 million (MXP 632.3 million) and 143,045 clients. Among its products are individual microcredit, group microcredit and life microinsurance (LMI).

Additional Resources

[1] Bloomberg: “Mexico’s Compartamos Seeks to Buy Micro-Finance Lender Abroad,” Thomas Black, April 15, 2010, http://www.bloomberg.com/apps/news?pid=20601086&sid=a.uLbgA7TVzc

[2] Bloomberg: “Homex, Compartamos Turn to South America for Growth” by Fabiola Moura, December 2, 2009, http://www.bloomberg.com/apps/news?pid=20601086&sid=alTdE2mg9_Ko

[3] MicroCapital: “MICROCAPITAL BRIEF: Mexican Microfinance Institution (MFI) Financiera Independencia Closes $41m Acquisition of Financiera Finsol,” Stefanie Rubin, March 1, 2010,  http://www.microcapital.org/microcapital-brief-mexican-microfinance-institution-mfi-financiera-independencia-closes-41m-acquisition-of-financiera-finsol/

MicroCapital’s Microfinance Universe profile: Compartamos Banco: http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Compartamos+Banco

MicroCapital’s Microfinance Universe profile: Financiera Independencia: http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Financiera+Independencia

MicroCapital’s Microfinance Universe profile: Finsol: http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Finsol

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