MICROCAPITAL BRIEF: LOLC Finance of Sri Lanka Borrows $10m from Sweden’s Swedfund for Microfinance, SME Lending

Swedfund International, a development finance institution owned by the Swedish government, recently issued a loan of USD 10 million to LOLC Finance PLC of Sri Lanka. LOLC Finance is a member of the LOLC Group, whose name derives from the former Lanka Orix Leasing Company. The deal with Swedfund was facilitated by Emerging Markets Global Advisory Limited (EMGA), an investment bank with offices in the UK and the US.

Rohan Perera, the treasurer of LOLC Group, expressed the organization’s “appreciation to EMGA as we continue our relationship, for successfully structuring a new foreign financing opportunity that will complement our expansion plans and enable us to harness our strengths and deliver on our vision for inclusive, sustainable growth in the micro and SME [small and medium-sized enterprise] sector.”

LOLC Finance is a non-banking financial institution that has LKR 211 billion (USD 1.2 billion) in total assets, return on assets of 2.83 percent and return on equity of 29.9 percent as of 2019. It holds LKR 115 billion (USD 634 million) in customer deposits.

LOLC Group, which is a Sri Lanka-based unit of the Japanese conglomerate Orix, has operations in a range of industries in Cambodia, Myanmar and Pakistan as well as Sri Lanka.

The goal of Swedfund “is to fight poverty by investing in sustainable businesses.” As of 2018, it has SEK 6.5 billion (USD 691 million) in total assets. Its partners include approximately 64 firms in 28 countries.

EMGA helps institutions that are seeking equity capital or debt financing. It clients in approximately 40 countries.

Sources and Additional Resources

Daily Mirror article
http://www.dailymirror.lk/press-releases/Leading-Sri-Lankan-Financial-Institution–LOLC-Finance-PLC-secures-USD-10m-new-cross-border-funding-/335-179942

LOLC Finance homepage
https://www.lolcfinance.com/

LOLC Finance annual report
https://cdn.lolcfinance.com/lolc-finance-uploads/2019/08/1b5ca215-annual-report-2018-2019_n.pdf

Swedfund homepage
https://www.swedfund.se

Swedfund 2018 annual report
https://www.swedfund.se/media/2251/swedfund-integrated-report-2018.pdf

Emerging Markets Global Advisory Limited homepage
https://www.emergingmarketsglobaladvisory.com/

MICROCAPITAL BRIEF: Microfinance Institution LOLC Completes $20m Bond Issue on Cambodia Securities Exchange
https://www.microcapital.org/microcapital-brief-microfinance-institution-lolc-completes-20m-bond-issue-on-cambodia-securities-exchange/

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