MICROCAPITAL BRIEF: responsAbility Securitizes $175m for 26 Microfinance Institutions, SME Lenders from Investors Including Alecta, Calvert, OPIC

A Switzerland-based “impact asset manager,” responsAbility Investments, recently securitized USD 175 million for lending to 26 funders of micro-, small and medium-sized enterprises (MSMEs). The three-year securitization offers listed bonds at senior and mezzanine levels with unspecified “commercial” fixed rates of return, as well as a junior level with a variable rate. The MSME lenders, which include Ameriabank of Armenia, serve 30,000 enterprises and 5.6 million individuals, of whom 81 percent are women. The transaction was arranged by US-based financial group JP Morgan.

Eric Wragge, the managing director of the securitised products group at JP Morgan, said, “This is an area of increasing focus for fund managers globally and applying capital markets technology to traditional impact investing creates the potential to open this sector to a wider range of investors.”

The investors include Alecta, a mutual managing USD 100 billion in pension funds for 2.5 million people in Sweden; Calvert Impact Capital, a US-based nonprofit investor with a portfolio of USD 377 million; and the US government’s Overseas Private Investment Corporation (OPIC).

Founded in 2003, responsAbility is headquartered in the city of Zurich. As of 2019, it has debt and equity deployed in 540 firms distributed across 90 “emerging economies and developing countries, targeting the inclusive finance, renewable energy and sustainable agriculture sectors.” These assets are valued at a total of USD 3 billion.

Sources and Additional Resources

Press release from responsAbility
https://www.responsability.com/en/responsability-closes-usd-175-million-microfinance-securitization

Alecta homepage
https://www.alecta.se/

Calvert homepage
https://www.calvertimpactcapital.org/

OPIC homepage
https://www.opic.gov/

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