MICROCAPITAL BRIEF: Credit Rating Agency Standard and Poor’s (S&P) Upgrades Mexican Microfinance Institution (MFI) Compartamos Banco

Compartamos Banco, a publicly-listed microfinance institution (MFI) based in Mexico, has been upgraded by credit rating agency Standard and Poor’s (S&P) to ‘mxAA’ and ‘mxA-1+’ for its long and short-term ratings, respectively. Compartamos Banco’s local bank bonds issued in August 2009, COMPART 09, were also upgraded to ‘mxAA’ and ‘mxA-1+’ with a ‘stable’ outlook.

According to the S&P press release, “the upgraded ratings reflect Compartamos’ capacity to maintain its financial profile, based on its asset quality and profitability, which surpasses those reported by the main participants of the Mexican financial sector, despite the difficult economic conditions that have prevailed in Mexico. The Bank has been able to maintain a solid pace of market penetration in its target market, due to its strong capitalization level, as well as its well-diversified financing sources, with long-term maturities.”

Compartamos Banco made its initial public offering (IPO) in 2007 on the Mexican and New York 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 (USD 591 million).

By: Christine Chang, Research Associate

About 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 Mexican and New York 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).

Additional Resources:

Business Wire website: Standard and Poor’s Upgrades Compartamos’ Rating to ‘mxAA’ and ‘mxA-1+’ With a ‘Stable’ Outlook, April 16, 2010: http://www.businesswire.com/portal/site/home/permalink/?ndmViewId=news_view&newsId=20100416005647&newsLang=en

MicroCapital.org: WHO’S WHO IN MICROFINANCE: Compartamos Banco, January 13, 2010: https://www.microcapital.org/who%E2%80%99s-who-in-microfinance-compartamos-banco/

MicroCapital.org: PRESS RELEASE: Mexican Microfinance Institution Compartamos Triples Bond Issue to $115m, August 20, 2009: https://www.microcapital.org/press-release-mexican-microfinance-institution-compartamos-triples-bond-issue-to-115m/

MicroCapital.org: NEWS WIRE: Mexico: Microfinance Institution Compartamos Issues $37m in Long-Term Debt, August 11, 2009: https://www.microcapital.org/news-wire-mexico-microfinance-institution-compartamos-issues-37m-in-long-term-debt/

MicroCapital Universe: Compartamos Banco: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Compartamos+Banco

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