MICROCAPITAL BRIEF: OPIC to Support Citi in Loaning up to $200m to Support Small Businesses in Africa, Asia, Eastern Europe, Latin America

Citigroup (Citi), a US-based financial services corporation, and the Overseas Private Investment Corporation (OPIC), a development finance institution of the US government, reportedly have partnered to deliver USD 200 million to Citi’s local and multinational corporate and financial institution clients [1]. These clients are engaged in various sectors, such as microenterprise, agribusiness and clean energy. A portion of the financing will be on-lent to small corporate suppliers as well as self-employed individuals and smallholder farmers in rural Africa, Asia, Eastern Europe, Latin America and the Middle East. The aim of the investment is to further increase opportunities for financial inclusion of micro- and small enterprises within the “mainstream” financial system [1].

Further details about the OPIC-Citi partnership are not specified. However, in the past, OPIC shared credit risk with Citibank, the consumer banking division of Citigroup, by guaranteeing loans distributed by Citibank [2].

The new collaboration follows a successful past Citi and OPIC partnership established in 2006 by OPIC and Citi that delivered USD 350 for microlending in emerging markets worldwide. As of 2013, the 2006 initiative has funded approximately 38 microfinance institutions in 21 countries, delivering small loans to more than 960,000 borrowers, of which 91 percent are women [1].

As of June 2013, Citigroup reported total assets of USD 1.9 trillion and total deposits of USD 938 billion. As of 2012, OPIC listed a net income of USD 272 million and total portfolio of USD 16.4 billion. OPIC has active projects in 103 countries as of 2012.

By Anesa Kratovac, Research Associate

About Citigroup

Citigroup is a financial services corporation with its headquarters in New York. Citigroup offers services in approximately 140 countries, including consumer and commercial banking, brokerage, asset management and institutional securities and transactions services. Citigroup’s philanthropic activities are carried out by the Citi Foundation. As of June 2013, Citigroup reported total assets USD 1.9 trillion and total deposits of USD 938 billion.

About the Overseas Private Investment Corporation

The Overseas Private Investment Corporation (OPIC) is an agency of the US government that was established in 1971 as a development finance institution. OPIC works with private-sector firms in the US to identify opportunities in emerging markets and create an enabling environment for private enterprise in developing countries. OPIC provides financing through direct loans as well as guarantees, political risk insurance and investment funds. As of 2012, OPIC is active in 103 countries and reports a total portfolio of USD 16.4 billion.

Sources and Additional Resources:

[1] OPIC Press Release, September 25, 2013, “OPIC and Citi to Leverage up to $200 Million in Financing to Connect Micro and Small Enterprises with Corporate and Financial Institutions,”  http://www.opic.gov/press-releases/2013/opic-and-citi-leverage-200-million-financing-connect-micro-and-small-enterprises-corporate-and-financial-ins

[2] OPIC Press Release, June 2, 2011, “OPIC Board Approves $550 Million for Citibank Lending in Emerging Markets,”http://www.opic.gov/press-releases/2011/opic-board-approves-550-million-citibank-lending-emerging-markets

MicroCapital Article, August 13, 2013, “MICROCAPITAL BRIEF: Applications Open for Citi Foundation’s Indian Micro Enterprise Awards 2013,” https://www.microcapital.org/microcapital-brief-applications-open-for-citi-foundations-indian-micro-enterprise-awards-2013/

MicroCapital Article, June 12, 2013, “MICROCAPITAL BRIEF: Bank for Agriculture and Agricultural Co-operatives, Habitat for Humanity Thailand, Citi Foundation Launch ‘Microsavings Program for Home Improvement’,” https://www.microcapital.org/microcapital-brief-bank-for-agriculture-and-agricultural-co-operatives-habitat-for-humanity-thailand-citi-foundation-launch-microsavings-program-for-home-improvement/

MicroCapital Article, April 1, 2013 “MICROCAPITAL BRIEF: Overseas Private Investment Corporation (OPIC) Lends $5m to Thaneakea Phum Cambodia (TPC) to Expand Housing, Microfinance Loans,” https://www.microcapital.org/microcapital-brief-overseas-private-investment-corporation-opic-lends-5m-to-thaneakea-phum-cambodia-tpc-to-expand-housing-microfinance-loans/

MicroCapital Article, March 7, 2013, “MICROCAPITAL BRIEF: Overseas Private Investment Corporation (OPIC), US Agency for International Development (USAID) Commit $23m to Development Innovations Group (DIG) Housing Finance Facility in Haiti,”https://www.microcapital.org/microcapital-brief-overseas-private-investment-corporation-opic-us-agency-for-international-development-usaid-commit-23m-to-development-innovations-group-dig-housing-finance-facility-in-haiti/

MicroCapital Article, February 19, 2013, “MICROCAPITAL BRIEF: Citigroup Launches Citi Mobile Collect in the Dominican Republic,”https://www.microcapital.org/microcapital-brief-citigroup-launches-citi-mobile-collect-in-the-dominican-republic/

MicroCapital Universe Profile: Citigroup, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Citigroup

MicroCapital Universe Profile: Overseas Private Investment Corporation (OPIC), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Overseas+Private+Investment+Corporation+%28OPIC%29

Do you know that MicroCapital publishes the MicroCapital Monitor newspaper each month? Find out more at https://www.microcapital.org/products-page/.

 

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