MICROCAPITAL BRIEF: International Finance Corporation (IFC) Makes $3m Equity Investment in Bina Usaha Keluarga (BUK) of Indonesia, Seeking to Triple Female Clients of Microfinance Institution Mitra Bisnis Keluarga Ventura (MBK)

Bina Usaha Keluarga (BUK), the Indonesia-based controlling shareholder of Mitra Bisnis Keluarga Ventura (MBK), a microfinance institution (MFI) in the same country, recently received an equity infusion of IDR 34.3 billion (USD 3 million) from the International Finance Corporation (IFC), a US-based international financial institution and a member of the US-based World Bank Group, to triple the number of female clients of MBK. Grameen Capital India, an advisory social business based in India, served as the executive adviser on the transaction [1]. Further information is not available.

Dr Shafiq Dhanani, Founder and President of MBK, stated that the MFI will now have a “bigger and more sustainable impact” in providing financial access to low-income people [1].

As of June 2012, MBK reported total assets of USD 39 million, a gross loan portfolio of USD 34.2 million, 322,000 clients, return on assets of 1.89 percent and return on equity of 11.83 percent. As of the same year, IFC’s total assets were reported at USD 75.8 billion.

By Anesa Kratovac, Research Associate

About Mitra Bisnis Keluarga Ventura (MBK)

Mitra Bisnis Keluarga (MBK) Ventura is an Indonesian microfinance institution that was established in 2006. Its mission is to raise the living standards of the bottom 25 percent of the population in Indonesia by providing micro- and small loans to low-income households, particularly in rural areas and small towns on the island of Java. As of September 30, 2012, MBK Ventura reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 41.3 million, a gross loan portfolio of USD 34.1 million, return on assets (ROA) of 1.82 percent and return on equity (ROE) of 12.5 percent. As of December 12, 2012, MBK Ventura has approximately 329,000 active borrowers and does not accept deposits.

About International Finance Corporation (IFC)

A member of the US-based World Bank Group, the International Finance Corporation (IFC) offers loans, equity investments, advisory services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. At fiscal year-end 2012, IFC reported 184 member countries, total assets of USD 76 billion and return on equity of approximately 5 percent. As of June 30, 2012, IFC Asset Management Company had approximately USD 4.5 billion in assets under management.

About Grameen Capital India

Grameen Capital India is a “social business” based in the Indian city of Mumbai that aims to enable microfinance institutions (MFIs) to develop wider access to capital markets. It is a collaboration between Grameen Foundation USA, India-based IFMR Trust and US-based Citigroup. Its focus is on “developing access to capital markets, initially in India, through securitization and other appropriate financial vehicles; structuring and arranging credit enhancements/first loss guarantees to support the investment grade rating of the senior securities… and advising MFIs on the standards of governance, accounting, reporting, and transparency necessary to satisfy commercial financing sources.” Financial information is unavailable for Grameen Capital India.

Sources and Additional Resources:

[1] Grameen Capital Press Release, October 3, 2013, “PT Mitra Bisnis Keluarga Ventura’s, majority shareholder raises ~US$ 3 Mn from IFC,” http://grameencapital.in/images/gck-mbk.pdf

MicroCapital Article, August 9, 2013, “Standard Chartered Bank (SCB) Loans $6m to Asian MFIs ASA Philippines Foundation, Mitra Bisnis Keluarga Ventura of Indonesia,” https://www.microcapital.org/microcapital-brief-standard-chartered-bank-scb-loans-6m-to-asian-mfis-asa-philippines-foundation-mitra-bisnis-keluarga-ventura-of-indonesia/

MicroCapital Article, April 8, 2013, “International Finance Corporation (IFC) to Loan Up to $11m to Suryoday Micro Finance of India,”https://www.microcapital.org/microcapital-brief-international-finance-corporation-ifc-to-loan-up-to-11m-to-suryoday-micro-finance-of-india/

MicroCapital Article, March 27, 2013, “International Finance Corporation Invests $28m in Equity in Bhutan National Bank to Increase Financial Inclusion; Lending to Micro-, Small and Medium-sized Enterprises,” https://www.microcapital.org/microcapital-brief-international-finance-corporation-invests-28m-in-equity-in-bhutan-national-bank-to-increase-financial-inclusion-lending-to-micro-small-and-medium-sized-enterprises/

MicroCapital Article, March 5, 2013, “Grameen Credit Agricole Microfinance Foundation (GCAMF) Loans $1.3m to Microfinance Institution Mitra Bisnis Keluarga (MBK) Ventura of Indonesia,” https://www.microcapital.org/microcapital-brief-grameen-credit-agricole-microfinance-foundation-gcamf-loans-1-3m-to-microfinance-institution-mitra-bisnis-keluarga-mbk-of-indonesia/

MicroCapital Universe Profile: PT Mitra Bisnis Keluarga Ventura (MBK), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Mitra+Bisnis+Keluarga+Ventura+%28MBK%29

MicroCapital Universe Profile: International Finance Corporation (IFC), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=International+Finance+Corporation+%28IFC%29

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

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