Successful Closing of Rural Impulse Fund, supporting rural microfinance
Antwerp, Belgium, August, 10 2007 -
Incofin, a specialised microfinance investment manager with Head Office in Antwerp, Belgium, is proud to announce that “Rural impulse Fund” (RIF), a new microfinance investment fund, that will target rural microfinance institutions (MFIs) has been successfully closed in Luxembourg on August, 10, 2007.
The objective of RIF is to contribute to the alleviation of poverty in rural areas by making equity and debt investments in rural MFIs”, says Loïc De Cannière, Managing Director of Incofin. “Rural MFIs target both farm and non-farm population in small towns and villages. They provide adapted microfinance products to rural poor, enabling them to break out of the vicious circle of poverty. The rationale of the Fund’s investment policy is based on two observations: (i) Rural areas in poor countries remain underserved by MFIs, although the majority of the world’s poor live in rural areas and (ii) the majority of existing mainstream microfinance funds mainly target urban MFIs.”
The Fund will lead the way in closing the gap in the supply of rural microfinance by extending commercial funding and strengthening the financial structure of those MFIs, which have proven to be successful in providing financial services to rural poor, while being financially sustainable.
“Rural MFIs will be selected on the basis of a methodology, measuring the presence of the MFIs’ points of sales in rural areas.
RIF ill invest in financially sustainable MFIs, which, moreover, outperform in terms of outreach and social performance”, says Geert Peetermans, Chief Investment Officer at Incofin.
RIF wll invest 25% of its total assets in ACP Countries (the Arica, Caribbean and Pacific Group of States). Other target regions include Latin America and Central Asia.
The Fund’s total assets amount to 38 Million USD, comprising an equity tranche of 9 million USD, a mezzanine tranche of 10 million USD and a senior debt tranche of 19 million USD. These tranches have been fully subscribed as per the Fund’s closing.
RIF is a unique example of private-public partnership, having a well balanced investor base, 50% coming from public and 50% from private sources. The subscribers to the equity tranche and to the mezzanine tranche include both development finance institutions (the Belgian Investment Company for Developing Countries (BIO), the European Investment Bank (EIB), the Netherlands Development Finance Company (FMO), the International Finance Corporation (IFC) and a group of private investors (KBC Private Equity, Incofin, MRBB, Volksvermogen, CERA, BRS). The Fund’s senior debt tranche has been subscribed by private investors from Germany, the US and Belgium.
This new investment vehicle has been developed and promoted by Incofin, which also acts as fund advisor to the Fund. Incofin has achieved a substantial growth over the last years. Today Incofin manages 4 microfinance funds, with combined total assets of 150 million USD. The portfolio managed by Incofin is of excellent quality, combining a good financial and social return.
RIF has been incorporated as a specialized Luxembourg investment vehicle (SICAV-FIS) and has been licensed by the Luxembourg financial regulator.
RIF is a closed-end fund with a 10-year lifetime.