in east asia and the pacific - world bankdocuments.worldbank.org › curated › en › ... · in...
TRANSCRIPT
CFInternational "Finance Corporation
"A World Bank Group
IFC Financing to Micro, Small, and Medium Enterprisesin East Asia and the Pacific
Key Highlights
IFC is working to develop solutions to close the micro, small, and (up 31.4 percent from $1.11 billion), $714 million of which wasmedium enterprise (MSMEI) financing gap, collaborating with attributed to long-term financing.34 financial institutions (Fls) across nine countries in the East Asiaand the Pacific (EAP) region. By the end of calendar yea (CY) 2012 PCs MSME clients had
3.32 m illon micro loans outstanding in the East Asia and Pacific (upAs of June 2013, FC committed a total of $2.6 billion to MSME 8 percentfrom 3.07 milion n CY201 1), totaling $4.84 billion (downfinance in the EAP region2, $2.3 billion for long term finance 11 percent from $5.07 bilon in CY201 1). Similarly, PCs MSME(including $143 million for funds supporting MSMEs), and cients had over 1.1 milion small and medium loans outstanding$314 million for trade finance. In fiscal year (FY) 2013 alone, by the end of CY2012 (up 11 percent from 1 million previousFC MSME commitments in the region were $1.45 bi(on year)3 totang $7306 b ion in this region (up 57 percent from
$4641 b ilon fniCY2011)n
MSME Financial Intermediary Portfolio FY2013 (as of June 2013)
IFC Committed Portfolio to MSMEsl IFC Total Committed Portfolio to MSMEsEAP region ($ Million) (% of Total Portfolio)
bywt the endite ofCY02rut1feretormliilinorviu
=>~~$64 billio inwt CY2011).YO 200
MSME Financial Intr P o F 3 ( WORLD
500 10% Middle East & North Africa (MENA)
EAP0 regoouth Asia (A)
000 S ub-Saharan Africa (SSA)
500 m Latin America & the Caribbeans ([AC)
* East Asia & the Pacific (EAP)
GrwtEurope & Central Asia (ECA)FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13
n Micro Enterprise Sinall Enterprise m Mediurn Enterprise
MSME Loans by Type of IFC Clients in EAP Region CY2012
MSME Loans by Microfinance Institutions IVSME Loans by SMVE Financial InstitutionsPFC was able to survey or extrapolate outreach data from 14 clients P lC was able to survey or extrapolate outreach data frommicrofinance institutions (MFIs) in six countries, 71 percent of these 20clients-small and medium enterprises (SME) Fls in seven countries,clients received advisory services from PFC. 70 percent of these ci ents received advisory services from PFC.
Number of Outstanding Average NPL Number of Outstanding Average NPLLoans Loan Portfolio Loan %4 Loans Loan Portfolio Loan %4
Outstanding n 000$ Sze Outstandng '000 in Size
Micro Loans 3,241,471 4,615,470 1,424 2% Micro Loans 78,167 222,218 2,843 7%
Small Loans 116,215 2,038,879 17,544 1%Small Loans 485,291 13,146,762 27,090 4%
Medium Loans 2,611 493,039 188,832 0 Medium Loans 542,577 57,378,483 105,752 4%
1. MSME firm size definitions: IFC s Financial Instiutions Group categorizes its clents sub-horrower according to the following definitions: (1) microfinance institution if loan< $10,000 at origination, (2) smal lenterprie iflan <$100,000 at origination; (3) medium enterprie if loan < $1 millon at origination ($2 million for advanced countries).
2. The share of committed loans to micofinance instiutions in the MSME regional comitted portfolio increased fom 20.7 percent in FY2012 to 21.5 percent in FY2013;small enterprises accounted for 47.6 percent in FY2013 (54 percent in FY201 2) medium enterpries accounted for 30.9 percent in FY2013 (25.4 percent in FY2012).
3 The committed portfolio in MSME Fls below does no nude comiment fo ommea banking tade nance and ol ecte investment vehicles.4. Nonperforming Loan (NPa =s> 90 dayN pas due Aan
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Growth Trends of Loan Volume by Type of Institution in EAP Region, CY2006-CY2012
Volume and Number of Micro Loans by MFIs Volume and Number of SME Loans by SME Fis
5,000 3,241 - 3,500 $80,000 1 -1,2004,500 2,7953,000 $70,000 927 1,000
43,5003 02,500 $50,000 C8003,0001 2,000 60
2 2,500 . ,31 $40,000 031,251 -21,500
2,000 1,127 $30,000 - 400- ,000 $20,000
5500 $10,000 79 105 87 -200z gg g_ z
2006 2007 2008 2009 2010 2011 2012 2006 2007 2008 2009 2010 2011 2012
- Micro Loans Number (right axis) - Micro Loans Volume (left axis) - SME Loans Number (right axis) - SME Loans Volume (left axis)
Micro loans portfolio demonstrated smooth growth over the last Temjrdie fsgiiatgot nnme 87tms nseveral years. Large swing in number and volume of micro loans in voue(6prntofsalndmimlaspoiedbSMCY201 1 was fostered by acquiring new clients in Indonesia, which 1inC2 1wsteaqstonfnwlrgcinsinhn,accounted for 55 percent of MFI regional portfolio in CY201 1. Vita anPhlpne,wchjnlycouedfr5pretThe drop in number of micro loans in CY2010, followed by the ofSEproloiCYO.Lestepbttllatgowhnterminating business with a large Indonesian client which accounted CY02wsatiuetoigfcntrwhinvlm(3ie)for 30 percent of CY2009 micro loans volume in the region, was annubrolas(27tm)ofnef Cptesinhn.partially compensated by new entrants in IFC portfolio and scaling Thscinacotefr53pcntftisegntotolon
up of CY20,01 win
MSME PortfoliooComposition1by Loan CategorytintEAP Region,owth0in-Fa Mic ro Loans SMll Loans M.7um las SME Loan s Sl onE Loans Medi Clans
2006o 55a3% 32rtol% 12mnst4%e 2006t 0ro5% over th91tTemjrdie fsinfcn rwhiubr(.7%ms n
C 2007.%11.2 6.5% fotrdb curn e let nIdnsa hc InC20 0.7% 8.4% 91.0%ino nwlrg lensiCia
2008nte 73.3%rcn fMF einl otoioi 0 18.3 8.4%na 2008 0hli 6%es 8hi1% 9.l acuteo 3%prcn
2009 84r8% 1nnme fmcolasiY0.5 4.8%we 200 th fSEprfloi Y0.6% 9.3% 90.1%tstl fsgothi
01pret C20 9 ir on ouei hein a 76.8 15mb7% 7o5 2010s 02.6% 10me1% 89.3%fIF arnrsiCia
partall copenate by ew ntrntsin FC prtflioandscaing This client accounted for 53 percent of this segment portfolio in
up of existing clients' portfolios. CY2012.
MSME Portfolio Composition by Loan Category in EAP Region, CY2012
MFI Portfolio SME FI Portfolio
mMedi.m aLoans -MdiuLmLoans
MFI Micro Loans Small Loans Medium Loans SME Micro Loans Small Loans Medium Loans
2006 55.3% 32.3% 12.4% 2006 0.5% 7.8% 91.7%
2007 82.3% 11.2% 6.5% 2007 0.7% 8.4% 91.0%
2008 73.3% 18.3% 8.4% 2008 0.6% 8.1% 91.3%
2009 84.8% 10.5% 4.8% 2009 0.6% 9.3% 90.1%
2010 76.8% 15.7% 7.5% 2010 0.6% 10.1% 89.3%
2011 69.5% 24.3% 6.3% 2011 1.4% 24.0% 74.6%
2012 64.6% 28.5% 6.9% 2012 0.3% 18.6% 81.1%
Total Portfolio Composition by Loan Category in EAP Region, CY2012
MFI Portfolio Composition: Volume of Loans SME Fl Portfolio Composition: Volume of Loans100%- 100% -
90% - 90% -80% - 80% -70% - 70% -60% - 60%50% - 50%40% - 40%-30% - 30% -20% 20%10% 10%0% - 0% L
2006 2007 2008 2009 2010 2011 2012 2006 2007 2008 2009 2010 2011 2012
m Corporate m Medium a Small s Micro a Retail m Corporate m Medium m Small m Micro a Retail
Deposits versus Loans Comparison CY2009-CY2012s
Over the last several years the deposits received by MFIs in EAP portfolio of small and medium deposits by $23 billion. Moreover,region demonstrated gradual growth. The portfolio of small and $2.7 billion increase of the client's portfolio in the Philippines (moremedium deposits held by MFIs increased by 16% in CY2012 since than six times) and an acquisition of the large client in Vietnam withCY201 1, which was mainly fostered by the $208 million expansion $2.3 billion portfolio further contributed to significant growth ofof a Cambodian client's portfolio (and $120 million increase of a the volume of micro deposits in CY2010. The $6.2 billion drop inMongolian client's portfolio. Also an acquisition of the two clients micro, small and medium deposits held by SME FIs in CY2011 canin China and Cambodia in CY2012 further enlarged portfolio by be explained by no deposit information reported by a large client in$62 million. The deposits held by SME Fls had an inconsistent trend China. However, in CY2012, the micro, small and medium depositover the last four years. The large spike of micro deposits and drop portfolio held by SME FIs demonstrated growth by 34 percent,in small and medium deposits in CY2010 were attributed to the which was mainly driven by the acquisition of the large client inrestructuring of the Chinese client in 2010, which transformed Indonesia with $1 billion of micro and $5.4 billion of small andfrom rural cooperative to rural commercial bank and increased the medium deposit portfolio.volume of micro deposits by $2.2 billion while scaled down the
Volume of Micro Loans and Deposits Volume of Small/Medium Loans and Deposits
by MFIs in EAP Region (s Billion) by MeIIs in EAP Region (b Billion)
$5 -$4.4 $4.6 $3-$.
$4 - $3.$ -$2- $1.$1.$4 - 92
$3 -'$3 - $2.2 $2.3 $2- $1.2 $13
$2 - $1$0
$1 - $06 J$0. $0.5 $0.4$1- $01 _ _ __ _
2009 2010 2011 2012 2009 2010 2011 2012
b Micro Deposits e Micro Loans x Small/Medium Deposits m Small/Medium Loans
volume of Micro Loans and Deposits Volume of Small/Medium Loans and Deposits
$14- by SME Fis in EAP Region (p Billion) $80- by SME Fis in EAP Region ( Billion) b3prn$12 - $11.6 $10.6 $70-$7.
$10 - $60-
$8-$8.3 $50- $82$44.5
$40- $28 $25.3 $5
voum of micro deposit by$.$blin3hl0saedw h
$4- $20-$2 - $4$.6 $10-
$5 - $
2009 2010 2011 2012 2009 2010 2011 2012
m Micro Deposits a Micro Loans a Small/Medium Deposits a Small/Medium Loans
5. Micro and Small/Medium deposits classification is based on the deposit size and irrespective of the recipient (retail/commercial). The classification was done in accordance withdefinition of the relevant loan size noted in footnote 1.
Trend Analysis of Compounded Annual Growth Rate (CAGR)6
CAGR Trend - Micro Loans by MFIs in EAP Region CAGR Trend - SME Loans by SME Fis in EAP Region
80% - 50% -70% - 67.1% 43.7% 42.2%
60% - 56.5% 40% - 34.3%
50% - 30% - 29.1%
40% - 33.4%30% - 26.6% 20% -
20% - 10.8% 10% -10% -iw -0.5% -2.5%
0% .. 0%-2004-2007 2008-2010 2011-2012 -10%. 2004-2007 2008-2010 2011-2012
n Number of Micro Loans * Volume of Micro Loans a Number of SME Loans a Volume of SME Loans
Client Highlight: XacB3ank, Mongolia
Objective and Client Need: Since then, IFC has kept providing various supports to facilitate
XacBank, which started as a micro credit project over 10 the further development of XacBank and its head companyyears ago, has established its leading position as the primary Tenger Financial Group (TFG).provider of banking services to the lower-income segment of The bank received advisory services in terms of capacity buildingthe Mongolian population. It operates in all 21 provinces and thecapital city serving more than 500 thousand customers through andocorpoate ernac in adi t fin l supportits 97 retail and business branches as well as specialized banking thrulans, equity investment in TF hasoutlets15.2 percent of shareholding, and its latest EMPS valuation was70 Savings and Credit Cooperatives. US $12.3 million, representing an IRR of 24.4 percent.
The development of a strong SME sector is essential to creatingjobs and maintaining a reasonable degree of economic Development Impact:diversification in Mongolia which is undergoing a mining boom. With strong market demand and XacBank's implementationXacBank has an important role to play taking into account the skills, the SME portfolio accounted for 45 percent of theprivate sector's contribution to support SMEs. As a consequence, total portfolio as of December 31, 2011 and contributedXacBank has begun developing its SME business by leveraging more than 50 percent operating income in 2011. The totalits expertise in credit management gained from the extensive gross loan portfolio sums up MNT537 billion (approximatelymicrofinance experience. US$386 million). Now, XacBank is the fourth largest bank in
Mongolia in terms of outstanding loans and total assets.IFC's role: According to the statistics of the Central Bank, at the end of
IFC's cooperation with XacBank started in 1999 with an advisory CY201 1, XacBank had a market share of 9.6 percent in lending.project to assist the Bank's transformation from a NGO-projectto a Non-bank financial institutions and then to a microfinancebank.
"XacBank has beneSfitted a lot from the continuous support from IFC. Currently, XacBank is maintaining its leadershippositions in micro finance and SME financing in Mongolia, and with the assistance from IFC, the bank is expanding itspresence in the Asian region. "
Mr Ganbaatar President, XacBank
6. Compounded annual growth rate (CAGR) from 16 reporting and repeated clients in the 2004-2007 period, 40 reporting and repeated clients in the 2008-2010 period,60 reporting and repeated clients in the 2011-2012 period, excluding greenfield institutions and Fls that are closing their operations
andcororteovrnaceinadIin tofnancinalsupr
15.2i percent of shareholding,r andits ast EMPSpval ationwaUSk$12.3 million, rersetn anorIRRnofif24.4gpercent.
With ~ F strong maktdmn n aBank' imopleettomore tha 50pretoeaigicoei-01 h oa
gros lanporfoioumsupMNT37bilio (approimate
US38 mlio).Nw,XaBnkiste out lrgs bnki