MICROCAPITAL BRIEF: Money Manager Christofferson, Robb and Company to Establish $400m Fund to Facilitate Commercial Investment in Small and Medium-Sized Enterprises (SMEs); International Finance Corporation (IFC) Commits $100m

Christofferson, Robb and Company (CRC), a private UK- and US-based money manager, is working to raise USD 400 million for a new “capital release fund” that will allow banks and financial institutions in developed countries to reduce the amount of capital that must be set aside against losses from their loans to small and medium-sized enterprises (SMEs) in developing countries. The goal of the fund is to allow banks to expand their SME portfolios, with unexpected loan losses covered by the fund in return for a fee.

According to Richard Robb, co-founder of CRC, “this transfers risk off banks and lets investors take the risk. If something bad does happen, the bank can continue to perform its functions and take the losses, which they’re ready for” [2].

The International Finance Corporation (IFC), the private-investment arm of the World Bank Group, is the only investor that has been named so far, with an initial contribution of USD 100 million [1].

By Rohan Trivedi, Research Associate

About International Finance Corporation (IFC):
A member of the 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. As of 2011, IFC has 182 member countries that drive its policies and approve disbursements. As of June 30, 2010, IFC reports net income of USD 1.75 billion, total assets of USD 61 billion, return on assets of 3.1 percent and total investment mobilization of USD 18.4 billion to 528 projects.

About Christofferson, Robb and Company:
Christofferson, Robb and Company (CRC) is a private UK- and US-based money management company that focuses on investments in global credit markets. CRC works to minimize credit risk for its clients by transferring capital into managed investment funds. CRC’s investments are targeted towards small and medium-sized enterprises (SMEs), housing finance and alternative energy. As of August 2011, CRC reports approximately USD 1.5 billion in net assets.

Sources and Additional Resources:

[1] IFC Press Release: “IFC Invests $100 Million in Innovative Fund to Boost Loans to SMEs in Emerging Markets”, http://ifcext.ifc.org/IFCExt/Pressroom/IFCPressRoom.nsf/0/124C29B0DAF5D3F185257909004D72DD

[2] The Financial Times: “World Bank unit invests in hedge fund”, http://www.ft.com/intl/cms/s/0/1b0ff7ac-dc6d-11e0-8654-00144feabdc0.html#axzz1Y1kfecPu

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

MicroCapital Universe Profile: Christofferson, Robb and Company (CRC), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Christofferson+Robb+and+Company+%28CRC%29

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