Recent investments totaling the equivalent of USD 5.5 million have been made to Moldovan microfinance institution (MFI) Microinvest by its shareholder’s: Oikocredit, Soros Economic Development Fund (SEDF), the Balkan Financial Sector Equity Fund (BFSE) and Richard Driehaus. Oikocredit contributed the equivalent of USD 1.3 million, SEDF the equivalent of USD 834,055, BFSE the equivalent of USD 2.98 million and Richard Driehaus the equivalent of USD 367,995. The investments led to an increase in Microinvest’s authorized capital to the equivalent of USD 7.5 million. Microinvest aims to expand technology, products and services.
Microinvest is a non-bank financial institution that was founded by the Soros Foundation Moldova in April 2003. It now has 9 regional offices and provides services to rural and urban Moldavians. According to its MIX Market profile, Microinvest provides individual and group loans, financial guarantees and community venture capital. MIX also reports that Microinvest has 2,691 active borrowers and debt-equity ratio of 247.08 percent as of December 31st 2007. According to the recent Responsible Finance report by Microinvest’s CEO Artur Munteanu (p 3), Microinvest’s total assets were USD 25.62 million with return on equity of 3.15 percent as of March 2008. Microinvest received a B+ from rating agency Planet Rating in June 2006.
Oikocredit, a Dutch cooperative investment fund launched in 1975, has various types of investors including church groups, social support groups and individuals. Oikocredit’s investments target microfinance institutions (MFIs), small businesses and cooperatives.
As of March 2008, Oikocredit was supporting 665 projects. According to its MIX Market profile, Oikocredit had 390 active investments with beneficiaries in 58 countries and total assets of USD 614.5 million as of December 2007. MicroCapital has reported on Oikocredit’s recent investments here.
New York based Soros Economic Development Fund (SEDF) is a nonprofit private foundation that was established in 1997 and began working with Microinvest in 2005. Soros looks to use investments to banks, MFIs, cooperative networks and social enterprise projects to extend financial services to low-income entrepreneurs. With a traditional focus on Eastern and Central Europe, Soros has extended its operations to 50 countries throughout Europe, Africa, Asia and Latin America. According to its 2006 Annual Report (p 36), it has total assets, as of December 31st 2006, of USD 139.6 million. MicroCapital has reported on SEDF’s past investments here.
Microfinance investment vehicle, Balkan Financial Sector Equity Fund (BFSE) is a private equity fund managed by Swiss Development Finance Equity (dfe) Partners. Begun in 2005, it works exclusively in the Balkans by investing in banks and non-bank financial institutions that provide financial services to micro and small-sized enterprises. Currently, für Wiederaufbau (KfW), Gray Ghost Fund, Opportunity International, Oikocredit, Omidyar Family Foundation and Swiss Investment Fund for Emerging Markets invest in BFSE. The fund’s value is currently the equivalent of USD 77 million.
Richard Driehaus is the founder, chief investment officer and chairman of Driehaus Capital Management LLC and founder of the Richard H. Driehaus Foundation. He has been called the pioneer of momentum investing, directing funds at small and medium-sized companies. He was named part of Barron’s All-Century mutual fund team of to industry’s top 25 individuals.
By Sarah Knapp, Research Assistant
Additional Resources:
Development Finance Equity (dfe) Partners
Driehaus Capital Management LLC
Microinvest: History, MIX Market profile, Planet Rating, Responsible Finance Report
Oikocredit: About, MIX Market profile, Projects
Soros Economic Development Fund (SEDF): 2006 Annual Report
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