MICROCAPITAL STORY: European Investment Bank (EIB) Supports Tunisian Microfinance with EUR 2 million Loan to ENDA Inter-Arabe

In a recent press release, the Facility for Euro-Mediterranean Investment and Partnership (FEMIP), a division of the European Investment Bank (EIB) dedicated to the economic development of nine Mediterranean countries¹, announced that it granted a long-term loan of TND 3.6 million (EUR 2 million/USD 2.9 million) to ENDA Inter-Arabe, a Tunisian microfinance institution (MFI). Based on an earlier MicroCapital report in July 2006, this marks EIB’s second loan to ENDA, and will be used to generate micro-loans and stimulate local investment.

EIB is a nonprofit public bank created by the Treaty of Rome in 1958 to act as the lending bank of the European Union (EU). While it remains financially autonomous, it operates in close collaboration with the wider banking community in raising funds on the capital markets and financing projects that promote EU objectives. Services offered by EIB include loans, technical assistance, guarantees, and venture capital. EIB is a member of the EIB Group, which also consists of the European Investment Fund (EIF). The current president of the EIB is Philippe Maystadt.

FEMIP began operations in October 2002 and is the key player in the economic and financial partnership between Europe and the Mediterranean, focusing primarily on private sector development and investment. Since its inception until year-end 2006, its financial operations have totaled to almost EUR 6 billion (USD 8.8 billion). In the area of microfinance, FEMIP aims to help microfinance associations establish appropriate governance structures and achieve long-term sustainability. In addition, it plans to dedicate its biannual conference in May 2008 to microfinance.

ENDA Inter-Arabe is an international non-governmental organization (NGO) established in 1990. After commencing operations in 1995, it reached financial self-sufficiency in 2003 and began contracting commercial loans to expand operations in 2005. It soon became the first Tunisian MFI to follow internationally recognized microfinance practices. ENDA’s forty branches throughout Tunisia aim to reach women from disadvantaged urban and rural areas. ENDA is one of seventeen founding members of Sanabel, a regional microfinance network for Arab countries founded in 2002. In 2006, it became a member of the Microfinance Network (MFN) and the Microfinance African Institutions Network (MAIN).

According to MIX Market, the microfinance information clearing house, as of the end of November 2007, ENDA had total assets of USD 23.6 million, a gross loan portfolio of USD 21.8 million, a debt-to-equity ratio of 135.5 percent, and portfolio at risk (PAR) of .5 percent. MIX also reported that 80.6 percent of its 61,857 active borrowers were women, with an average loan balance of USD 352 per borrower. It also received a rating of B+ from Planet Rating in June 2006. By 2010, ENDA hopes to reach 180,000 clients from 100 branches and report a loan portfolio of over USD 86 million.

For more information on ENDA Inter-Arabe, please refer to previous MicroCapital stories:

September 18, 2007: “Enda Inter-Arabe, the Tunisian Microfinance Institution Becomes the Latest Network Member to Join Women’s World Banking”

July 13, 2006: “European Investment Bank Expands Microfinance Investment in Tunisian with $950,000 Loan to ENDA Inter-Arabe”

¹Algeria, Egypt, Gaza/West Bank, Israel, Jordan, Lebanon, Morocco, Syria and Tunisia

By Mary Fu

Additional Resources:

European Investment Bank: “FEMIP supports microfinance in Tunisia – EUR 2 million loan to ENDA Inter-Arabe microfinance association”

MicroCapital article, July 13, 2006: “European Investment Bank Expands Microfinance Investment in Tunisian with $950,000 Loan to ENDA Inter-Arabe”

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