Washington, D.C., October 27, 2009
—IFC, a member of the World Bank Group, today announced it will list a bond to increase access to finance for poor and low-income entrepreneurs in developing countries. The bond will raise $300 million equivalent, a comparable amount to IFC’s annual microfinance program in recent years.
The listing and sale of IFC’s microfinance bond will be arranged by Daiwa Securities Group. The bond will be listed in Australian dollars and sales will be open to Japanese retail and institutional investors. IFC will direct an amount equal to the net proceeds of the bond to financial institutions that provide loans to microentrepreneurs in developing countries.
“Micro and small enterprises are key engines of employment generation
in developing countries, but they rarely have access to services provided by formal financial institutions
,
” said Lars Thunell, IFC Executive Vice President and CEO. “Through this bond, IFC can extend the impact of its own activities in microfinance while providing a platform for Japanese investors to create opportunities where they are needed most.”
Microfinance is a powerful instrument for reducing poverty. It enables poor people to build assets, increase incomes, and reduce their vulnerability to economic stress. IFC focuses on commercially viable microfinance institutions that can attract private capital needed to scale up and respond to unmet demand.
“Microfinance is becoming an attractive asset class for private investors because it has proven liquid and has performed consistently during recent market volatility,” said Nina Shapiro, IFC Vice President for Finance and Treasurer.
As a result of the global economic crisis, financing needs in the microfinance sector will reach $1.8 billion annually through 2010. IFC microfinance projects reached a cumulative committed volume of $1.29 billion in fiscal year 2009.
About IFC
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $14.5 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis. For more information, visit
www.ifc.org.
