MICROCAPITAL BRIEF: Indian Microfinance Institution Trident Microfin Defaults on Loan from Kotak Mahindra Bank

Trident Microfin, a microfinance institution (MFI) based in the Indian state of Andhra Pradesh, reportedly has received a legal notice from Kotak Bank, an Indian commercial bank, for defaulting on a loan it received from Kotak. According to Trident managing director Kishore Kumar Puli, “We had taken a INR 4 crore (USD 821,000) loan from Kotak Bank and repaid INR 2.6 crore (USD 534,000) but could not service the remaining…” Trident Microfin is said to have been behind on its repayments since January 2011. As of June 30, 2011, Trident Microfin reported total assets of USD 39 million, a gross loan portfolio of USD 29.5 million, return on assets of -3.1 percent and return on equity of -23 percent.

By Cameron Milani, Research Associate

About Trident Microfin Private Limited: Trident Microfin Private Limited (formerly Annapurna Financial Services Private Limited) is a microfinance institution that was established in 2007 and is headquartered in Hyderabad, Andhra Pradesh, India. The goal of the company is to provide comprehensive financial and business solutions to enterprises and low-income individuals, particularly women and microenterprises, in a socially, economically and environmentally sustainable manner. As of June 30, 2011, Trident Microfin reported total assets of USD 39 million, a gross loan portfolio of USD 29.5 million and 214,940 active borrowers.

About Kotak Mahindra Bank: Kotak Mahindra Bank is a private bank based in Mumbai, India. It operates under the umbrella of the Kotak Mahindra Group, which also offers stock brokerage, mutual funds, life insurance and investment banking. The bank was originally founded in 1985 as Kotak Capital Management Finance Limited, a non-banking financial organization. In 2003, it was converted into a bank. In November 2009, Kotak Mahindra Bank began participating in the International Finance Corporation’s Global Trade Finance Program, receiving a trade financing line of credit of USD 51 million to lend to small and medium-sized enterprises (SMEs).

Sources and Additional Resources:

The Economic Times, “Kotak Mahindra Bank Slaps Legal Notice on Trident,” http://articles.economictimes.indiatimes.com/2011-10-19/news/30297690_1_mfis-in-andhra-pradesh-kishore-kumar-puli-spandana-sphoorty-financial

MicroCapital Article, June 17, 2011: “MICROCAPITAL BRIEF: Wholesale Lenders Agree to Restructure $1b in Debt for Indian Microfinance Institutions (MFIs) Spandana Sphoorty, Asmitha, Future, Share, Trident,” https://www.microcapital.org/microcapital-brief-wholesale-lenders-agree-to-restructure-1b-in-debt-for-indian-microfinance-institutions-mfis-spandana-sphoorty-asmitha-future-share-trident/

MicroCapital Universe, Trident Microfin Private Limited: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Trident+Microfin+Private+Limited

MicroCapital Universe, Kotak Mahindra Bank: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Kotak%20Mahindra%20Bank

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