Belgium-based Incofin Investment Management (IM) recently disbursed a loan of USD 6 million to Inecobank, an Armenia-based institution, from the Microfinance Enhancement Facility (MEF), a fund launched by the German government’s KfW Entwicklungsbank and the World Bank Group’s International Finance Corporation. The proceeds will enable Inecobank to increase its lending during the COVID-19 pandemic. Since March, due to the pandemic, the bank moved all of its services online. Inecobank’s customers include individuals as well as businesses of all sizes.
Jan Dewijngaert, Incofin IM’s Regional Director for Eastern Europe & Central Asia, said of Inecobank, “The bank has a long track record of strong financial performance and is consistently among the most profitable banks in Armenia and is one of the pioneers of mobile banking. With their mobile payment platform, which is regarded as the best in the country, they aim to increase the outreach in rural areas. We are proud [of] our partnership with Inecobank both with equity and debt finance.”
Founded in 1996, Inecobank serves 500,000 customers. During the six months ending June 2020, it generated after-tax profit of AMD 3.2 billion (USD 6.6 million) from total assets of AMD 352 billion (USD 731 million).
MEF was established in 2009 to assist microfinance institutions (MFIs) in the wake of the financial downturn that began in 2008. MEF invests debt in the microfinance industry under a mandate to avoid “crowding out much-needed private sector…actors.” As of December 2019, MEF reported total assets of USD 770 million, with a microfinance investment portfolio totaling USD 566 million. During 2019, the fund disbursed 204 loans, averaging USD 2.9 million each, to 133 MFIs in 43 countries. MEF is managed by Incofin IM and three Switzerland-based firms, BlueOrchard, responsAbility Investments and the Symbiotics Group.
Incofin is a for-profit firm that was founded in 2001 and seeks “to promote inclusive progress.” As of January 2020, it has 320 investees in 66 countries, mostly working in financial inclusion and agriculture. Incofin’s portfolio is valued at USD 1 billion and comprises the following funds: agRIF, BRS Microfinance Coop Fund, Fairtrade Access Fund, Fonds pour l’Inclusion Financière en République Démocratique Congo (FPM), Incofin CVSO, Invest in Visions, Rural Impulse Fund (RIF) II, Volksvermogen and a loan portfolio of vdk bank.
By the MicroCapital team
Sources and Additional Resources
Incofin news release
http://www.incofin.com/incofin-im-advised-microfinance-enhancement-facility-mef-grants-a-usd-5-million-loan-to-inecobank-in-armenia/
Inecobank homepage
https://inecobank.am
MEF homepage
https://www.mef-fund.com
Previous MicroCapital post on MEF
https://www.microcapital.org/microcapital-brief-european-fund-for-southeast-europe-to-loan-6m-to-inecobank-to-support-micro-and-small-enterprises-mses/
Previous MicroCapital post on Inecobank
https://www.microcapital.org/microcapital-brief-european-fund-for-southeast-europe-to-loan-6m-to-inecobank-to-support-micro-and-small-enterprises-mses/
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