MICROCAPITAL BRIEF: MicroVest Awards $9M to Acleda Bank via IFC Syndication to Support SMEs in Cambodia, Focusing on Female Entrepreneurs
US-based wealth manager MicroVest awards Acleda Bank, a publicly traded company operating in three countries, $9 million over five years to fund Acleda’s provision of financial services to small and medium-sized enterprises (SMEs) in Cambodia, specifically these support owned by women. The investment is part of a syndication for Acleda by the World Bank Group’s International Finance Corporation (IFC), which is said to include up to $100 million each from IFC and a group of third-party partners. To support syndication, the Women Entrepreneurs Opportunity Facility, established by IFC and US financial institution Goldman Sachs, offers performance-based incentives totaling up to $550,000 when Acleda meets various goals for supporting women-owned businesses reached.
Acleda Bank emerged from an NGO founded in 1993 to support micro and small businesses in Cambodia. The organization became a commercial bank in 2003 and, as of 2022, its mission is to “provide micro, small and medium-sized entrepreneurs with the tools they need to efficiently manage their financial resources and thereby improve their quality of life”. The bank provides loans and deposits, as well as cash management, remittances, trade finance, payment cards and other services to individuals and businesses online and through 263 branches in Cambodia.
Acleda Bank’s subsidiaries include Cambodia-based Acleda Institute of Business; Cambodia-based Acleda Securities; Acleda MFI Myanmar, a microfinance institution (MFI) offering loans and savings to micro-entrepreneurs through 17 branches in Myanmar; and Acleda Bank Lao, a financial institution with 38 branches in Laos. In December 2021, the parent company reported $7.9 billion in assets, $5.7 billion in deposits, $5.4 billion in loans and advances, and a one-year profit of $167 million.
Launched in 2004, MicroVest is a family of funds investing in MFIs in emerging markets. It reported a gross loan portfolio of $519 million as of June 2021. MicroVest is a subsidiary of Development Alternatives Incorporated (DAI), a US-based international development company focused on “fundamental social and economic development problems caused by inefficient markets, ineffective governance and instability.”
Founded in 1956, IFC provides loans, equity investments, advisory services and technical assistance to private companies with the intent to alleviate poverty and promote open and competitive markets in low- and middle-income countries. In the 12 months ended June 2021, the organization disbursed a total of $31 billion in investments, about a third of which was mobilized by partner institutions.
The World Bank Group is a multilateral organization that aims to “end extreme poverty and promote shared prosperity in sustainable ways”. As of 2022, it has 189 member nations. The group includes: (1) the International Bank for Reconstruction and Development and the International Development Association, which make up the World Bank; (2) IFC; (3) the Multilateral Investment Guarantee Agency; and (4) the International Center for the Settlement of Investment Disputes. In fiscal year 2021, the World Bank Group disbursed funds totaling $60 billion.
Goldman Sachs provides banking, investment management, financial advisory and other services to corporations, governments and individuals. Founded in 1869, the company is headquartered in New York City and has offices in 39 countries. As of December 2021, it reported total assets of $1.5 trillion.
By Saulius Simonas Ramanauskas, Research Associate
Sources and Additional Sources
MicroVest press release
https://microvestfund.com/microvest-invests-9m-in-ifc-led-syndication-to-finance-women-led-smes-in-cambodia
Disclosure by IFC on investment in Acleda
https://disclosures.ifc.org/project-detail/SII/44882/acleda-sr-2020
Acleda homepage
https://www.acledabank.com.kh
MicroVest home page
https://microvestfund.com
DAI homepage
https://www.dai.com
IFC homepage
https://www.ifc.org
World Bank Group website
https://www.worldbank.org
Goldman Sachs home page
https://www.goldmansachs.com
Previous MicroCapital briefing on Acleda
https://www.microcapital.org/microcapital-brief-acleda-bank-cambodia-launches-unity-toanchet-digital-wallet
Previous MicroCapital briefing on MicroVest and IFC
https://www.microcapital.org/microcapital-brief-microvest-capital-management-announces-close-of-60m-microvest-ii-a-microfinance-equity-fund
Previous MicroCapital brief on DAI
https://www.microcapital.org/microcapital-brief-microvest-loans-5m-to-banco-delta-to-boost-post-covid-economy-in-panama-via-financial-access-for-msmes
Previous MicroCapital briefing on the World Bank Group
https://www.microcapital.org/microcapital-brief-world-bank-groups-ibrd-lending-400m-to-industrial-development-bank-of-turkey-tskb-for-smes-women-inclusive-enterprises- company, the syrian ref
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