MICROCAPITAL.ORG BRIEF: Faulu Advisory Services of Kenya has Acquired Trustmark Insurance to Diversify Services, Provide Microinsurance

Faulu Advisory Services (FAS), a fully owned subsidiary of Faulu Kenya, has acquired Trustmark Insurance Brokers in an effort to include microinsurance among its microfinance services. The price of the acquisition has not been disclosed. Faulu Kenya is a deposit taking microfinance company, which, until now, has offered credit and savings products for low-income Kenyans. FAS provides business advisory services for the microfinance industry. Mr. George Maina, CEO of FAS, commented, “It’s a strategic move on our side to venture into insurance brokerage. For now, we shall continue offering services that the brokerage used to have,” which include life and health insurance. According to the Business Daily, less than a million Kenyans currently have life insurance coverage, representing a 2.5 percent penetration rate.

By: Stefanie Rubin, Research Assistant

About Faulu Kenya:

Faulu Kenya was founded in 1992 as a pilot micro-enterprise lending program of Food for the Hungry International (FHI), a relief and development organization based in the USA. In 1999 it became a limited liability company and a 70 percent owned subsidiary of FHI. The latest information on Faulu Kenya can be found on the MIX Market, the information clearinghouse for microfinance. According to the MIX, by year-end 2008, Faulu Kenya had a gross loan portfolio of USD 37.6 million and 91,105 active borrowers. Total assets were USD 47.7 million, with an ROA of negative 1.11 percent and ROE of negative 7.08 percent.

About Trustmark Insurance Company:

Trustmark Insurance Company was founded in 1913 as Benefit Trust Life Insurance Company and is based in Lake Forest, Illinois. It provides life, medical, dental, managed care, disability, critical illness and accident insurance, as well as benefits administration services. In 2008, Trustmark reported an operating revenue of USD 830.4 million, assets of USD 1.7 billion, capital and surplus of USD 453.4 million and pretax gains of USD 53 million. According to its website, Trustmark has started changing its business from “low-volume, high-revenue products to high-volume but lower-price products.”

Additional Resources:

Source Article: Business Daily: “Faulu Acquires Insurer in Integration Move,” http://www.businessdailyafrica.com/Company%20Industry/-/539550/802186/-/t74tecz/-/index.html

Faulu Kenya: http://www.faulukenya.com/index.php?option=com_frontpage&Itemid=1

The MIX Market: Faulu Kenya: http://www.mixmarket.org/mfi/faulu-ken

Trustmark Companies: http://www.trustmarkins.com/internet/corporate/

Trustmark Financial Summary: http://www.trustmarkins.com/internet/corporate/aboutus_201.html

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