FOMIN, IIC, Investors, Launch New Lending Facility For Microfinance In Cancun
03/19/2010Citibank’s Banamex joins the Microfinance Growth Fund, which opens its doors for business in Latin America and the Caribbean.
CANCUN, Mexico, March 20, 2010 – The Inter-American Development Bank’s Multilateral Investment Fund (FOMIN), the Inter-American Investment Corporation (IIC), the Corporación Andina de Fomento (CAF), and four private investors today signed documents launching the Microfinance Growth Fund (MIGROF), a new lending facility for microfinance institutions in Latin America and the Caribbean.
The new facility is expected to provide up to $250 million in medium and long term loans to microfinance institutions throughout the region, offering financing in local currency and in US dollars. A $125 million loan from the U.S. Overseas Private Investment Corporation (OPIC), pledged at the signing ceremony today, will allow MIGROF to initiate its lending operations in coming weeks.
Banamex, Mexico’s largest private bank and a subsidiary of U.S.-based Citibank, recently joined MIGROF as an investor and partner who is expected to play a major role in its corporate governance.
The creation of MIGROF was first announced by U.S. President Barack Obama in April 2009. Speaking at the Fifth Summit of the Americas in Port of Spain, Trinidad and Tobago, he advanced that OPIC would partner with FOMIN and the IIC to launch a new source of funding for microfinance institutions in response to the reduction in their lending capacity due to the global credit crisis.
FOMIN and the IIC took a leading role in structuring MIGROF and defining its lending strategy. They also engineered the competitive process by which Swiss investment management company BlueOrchard Finance S.A. became the new facility’s manager.
"This new facility will not only help restore the lending capacity of microfinance institutions after the impact they felt when they were hit by the global financial crisis", said IDB President and Chairman of the Board of the IIC, Luis Alberto Moreno, at the signing ceremony. "MIGROF will also fuel the engine of growth in microfinance, boosting economic growth and increasing employment in many countries of the region".
FOMIN is providing $10 million in equity to the new facility, the IIC will contribute up to $5 million, and CAF will invest up to $10 million. The private partners and investors in MIGROF, besides Banamex, are the Norwegian Microfinance Initiative (NMI), ACCION International, and BlueOrchard.
This press relase is also available in French and Portuguese
Contact: Sylvia Szankay
Telephone: (202) 623-3878