MICROCAPITAL BRIEF: European Bank for Reconstruction and Development (EBRD) Sells Dai-ichi Life Insurance $100m in Microfinance Bonds

The European Bank for Reconstruction and Development (EBRD), a multilateral institution headquartered in London, recently announced that it has sold ten-year microfinance bonds valued at MXN 1.7 billion (USD 100 million) to Japan’s Dai-ichi Life Insurance Company, a firm that offers life, property and casualty insurance as well as investment trust and related services. Dai-ichi Life’s investment under the EBRD microfinance bonds program supports micro- and small enterprises (MSEs) in Eastern Europe, Central Asia and North Africa. The sole arranger of the transaction was Crédit Agricole Corporate and Investment Bank (Crédit Agricole CIB), an arm of the France-based Crédit Agricole Group that specializes in capital markets, investments and corporate banking services.

Kazuyuki Shigemoto, the general manager of the global fixed income investment department of Dai-ichi Life, said that “Dai-ichi Life follows investment principles that combine attractive investment opportunities with social, environmental, and governance (“ESG”) considerations. We strongly support the EBRD’s projects that provide the sustainable development of the emerging countries thorough funding to MSEs. […] We also believe the bonds offer solid and attractive investment opportunity”[1]. Isabelle Laurent, EBRD’s deputy treasurer and head of funding, added that “this bond not only helps EBRD finance key microcredit projects, but also serves to highlight the importance of improving access to finance for those underserved by banks, thereby helping them to better cope with risk and to increase their income from self-employment”[1].

EBRD invested EUR 8.9 billion (approximately USD 10.1 billion) in 377 projects in 34 countries during 2014, and as of December of that year, it reported total members’ equity of EUR 14.2 billion (approximately USD 16.1 billion). As of March 31, 2015, Dai-ichi Life reported total assets of JPY 50 trillion (USD 411 billion) from its nine countries of operation. Crédit Agricole CIB reported net income of EUR 1 billion (USD 1.2 billion) as of December 2014.

By Alíz Crowley, Research Associate

About European Bank for Reconstruction and Development (EBRD)

The European Bank for Reconstruction and Development (EBRD) is a multilateral institution headquartered in London, England. The bank began operations in 1991 upon the agreement of 40 countries, and is owned by 64 countries as well as the European Investment Bank and the European Union as of 2015. It aims to finance operations that are both commercially viable and assist development in Eastern Europe, Central Asia and North Africa. It does this by providing loans, debt securities, equity investments, guarantees and technical assistance to micro- and small businesses via commercial banks and non-bank microfinance institutions (MFIs). EBRD invested EUR 8.9 billion (approximately USD 10.1 billion) in 377 projects in 34 countries during 2014, and as of December of that year, it reported total members’ equity of EUR 14.2 billion (approximately USD 16.1 billion).

About Dai-ichi Life Insurance Company

Dai-ichi Life Insurance Company (Dai-ichi Life) is a Japanese insurance company that was established in 1902 and is based in Tokyo. The organization offers life, property and casualty insurance as well as investment trust and related services. In addition to its presence in Japan, Dai-ichi Life has affiliates in Australia, mainland China, Hong Kong, India, Indonesia, Thailand, United States, United Kingdom and Vietnam. As of March 31, 2015, Dai-ichi Life reported total assets of JPY 50 trillion (USD 411 billion).

About Crédit Agricole Corporate and Investment Bank (Crédit Agricole CIB)

Crédit Agricole Corporate and Investment Bank (Crédit Agricole CIB) is the investment and corporate banking arm of the French financial services group Crédit Agricole. Crédit Agricole CIB offers a range of financial services including investment banking, structured finance, capital markets, debt optimization and distribution, international trade finance and transaction banking. The organization has 33 offices in Europe and in the Americas, the Asia-Pacific region and the Middle East. Crédit Agricole CIB reported net income of EUR 1 billion (USD 1.2 billion) as of 2014.

Sources and Additional Resources

[1] European Bank for Reconstruction and Development (EBRD), News, Dai-ichi Life Invests in first microfinance bonds issued by the EBRD for institutional investor

[2] MondoVisione, Dai-Ichi Life Invests In First Microfinance Bonds Issued By The EBRD For Institutional Investor

[3] Dai-ichi Life Insurance Company, Investor Relations, Financial Information

[4] Crédit Agricole Corporate and Investment Bank, News Releases, Annual Results 2014

MicroCapital Universe Profile: Crédit Agricole Corporate and Investment Bank (Crédit Agricole CIB)

MicroCapital Universe Profile: Dai-ichi Life Insurance Company

MicroCapital Universe Profile: European Bank for Reconstruction and Development (EBRD)

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