MICROCAPITAL BRIEF: Fundacion BBVA MicroFinanzas Continues Buying Equity in Microfinance Institution Financiera Confianza of Peru with responsAbility Transaction

Fundacion BBVA MicroFinanzas, which was launched by Spain’s Banco Bilbao Vizcaya Argentaria (BBVA) in 1998, recently added to its shareholding in Financiera Confianza, a Peruvian microfinance institution (MFI) by purchasing the stake held by Switzerland-based responsAbility Investments. Although the size and price of the holding, which responsAbility began building in 2008, remains confidential, responsAbility reports that it earned “over three times [the] net value” it invested in the MFI. During 2017, Fundacion BBVA MicroFinanzas increased its stake in Confianza with purchases from Netherlands-based Oikocredit and Belgium-based Incofin Investment Management.

The head of financial institutions equity investments for responsAbility, Michael Fiebig, stated that “by selling our shares to majority shareholder Fundación Microfinanzas BBVA, we ensure that Financiera Confianza will be able to continue its strong social engagement, driving financial inclusion and poverty reduction.”

Founded in 1998, Confianza primarily serves rural areas of central Peru. As of 2018, it serves 500,000 clients via 147 branches with a loan portfolio of USD 459 million and client deposits of USD 313 million.

Fundacion BBVA MicroFinanzas holds stakes in six MFIs in Chile, Colombia, the Dominican Republic, Panama and Peru. As of 2017, BBVA has EUR 702 billion (USD 820 billion) in total assets and 71 million customers in 30 countries.

ResponsAbility Investments, which manages assets valued at USD 3 billion, invests debt and equity in “the agriculture, energy and finance sector[s] of emerging economies.” Its placements in Latin America include USD 790 million lent to 95 financial institutions as of December 2017.

Sources and Additional Resources

ResponsAbility press release
https://www.responsability.com/en/sale-minority-share-financial-inclusion-focused-majority-shareholder

BBVA
https://www.bbva.com/

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