ROLE OF CAPITAL MARKETS

  • The microfinance industry is experiencing increased foreign investment, capital markets access, and integration into the banking sector:

  • Private investment in microfinance has been growing rapidly (over $13 BN as of 2009)

  • Microfinance institutions are accessing capital markets, including bonds issuances, syndications, securitized vehicles, and IPOs

  • Commercial banks have downscaled into sector and investment banks have set up microfinance divisions

  • A series of microfinance IPOs were launched in the past few years which generated significant interest among investors:

    - SKS (India), July 2010, $358 MM
    - Banco Compartamos (Mexico), April 2007, $467mm
    - BRAC Bank (Bangladesh), December 2006, $12mm
    - Equity Society (Kenya), August 2006, $87mm
    - Bank Rakyat (Indonesia), November 2003, $489mm