Zurich, November 2015
Investments for Development – Swiss Innovation for a Sustainable World
“ Our aim is not just to keep people alive, but to give them a life- a decent life” General Secretary Ban Ki-Moon 2015, September 28th UNO General Assembly
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500m people are smallholder farmers and need finance
2.5bn people have no access to formal financial services
70% of rural population has no access to piped water
1.6bn people live in poor housing and 100m are homeless
2.3bn people have no access to reliable electricity
99% of all maternal deaths occur in developing countries 4
3.9 trillion USD p.a. investment needs in SDG sectors
Annual investment
gap
Annual investment
needs
Current
annual investments
2.5
3.9
1.4
Source: UNCTAD World Investment Report (2014) and United Nations
(p.a. in USD) Current
Investments
Investment
Gap
Education 80bn 250bn
Health 70bn 140bn
Food Security & Agriculture 220bn 260bn
Climate Change 190bn 550bn
Infrastructure 870bn 1200bn
Biodiversity 100bn
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Enough money is available
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Why are these funds not finding the way?
• Risk-return models • Accessible and affordable
basic needs • Investment climate • High intermediation costs • Dormant capital pools • Absorption capacity • Some sectors sensitive to
private sector involvement
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BlueOrchard is a pioneer in microfinance and impact investing
60COUNTRIES
3Bn DOLLARS
30Mio PEOPLE
SINCE2001
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BlueOrchard: local presence for global outreach
Nairobi Kenya
Lima Perou
Phnom Penh Cambodge
Genève Zurich
Luxembourg
Tbilissi Georgia
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Microfinance Enhancement
Facility (MEF)
Customized mandate tailored to investors’ needs BlueOrchard Microfinance Fund
(former Dexia Micro-Credit Fund)
2001
BlueOrchard Microfinance
Securities 1 (BOMSI)
2004
Saint-Honoré Microfinance Fund 2005
BBVA Codespa Microfinanzas
2006
BlueOrchard Loans for
Development 2006 (BOLD 2006)
2006
BlueOrchard Loans for
Development 2007 (BOLD 2007)
2007
2009
Microfinance Growth Fund
(MiGroF)
2010
Microfinance Initiative for Asia
(MIFA) – Debt Fund
2013
Regional Education Finance Fund
for Africa (REFFA)
2014
Climate Insurance Fund (CIF)
2015
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Microfinance Initiative for
Asia (MIFA)
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Objectives - Provide finance to Tier 2 and 3 MFIs in Asia
- Encourage financial institutions to lend to MSMEs
- Includes ‘green financing’ (in 2016)
- Foster responsible finance principles in Asia and develop local capital markets
Partners - Public sector: IFC, KfW, BMZ, EU
- Private sector: BlueOrchard, institutional investors
Benefits - Reputation & branding
- Risk mitigation for private investors
- Technical assistance (strenghten MFIs, meet development goals)
Microfinance Initiative for Asia (MIFA)
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Climate Insurance Fund (CIF)
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Objectives - Develop Climate Insurance Markets for low-
income households/MSMEs
- Invest in insurance companies and financial institutions with innovative insurance products (extreme weather events, natural catastrophes, agricultural insurance)
Partners - Public sector: KfW, BMZ
- Private sector: BlueOrchard, Celsius Pro (TA Manager), investors (after pilot phase 2017)
Benefits - Innovation (G7 initiative)
- Risk mitigation for private investors
- Technical assistance (activate market for weather insurance, product design)
Climate Insurance Fund (CIF)
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Regional Education Finance Fund for Africa (REFFA)
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Objectives - Increase equal access to quality secondary,
vocational and higher education
- Enhance quality of education
- Finance the education finance portfolio of selected African financial institutions (schools + students)
Partners - Public sector: KfW, BMZ, Ofid (2016)
- Private sector: BlueOrchard, family offices, foundations
Benefits - Innovation (first ever education fund Africa)
- Risk mitigation for private investors
- Technical assistance (market development, reduce credit risk, meet development goals)
Regional Education Finance Fund for Africa (REFFA)
Regional Education Finance
Fund for Africa (REFFA)
Structure Regional Education Finance Fund for Africa (REFFA)
For investors meeting Luxemburg SICAV-SIF requirements
Senior Tranche (Shares & Notes)
Development Financial Institutions +
Junior Tranche
1% fixed return / unlimited maturity
USD 28 Mil Q1 2016 (foundations, family offices, other BO private investors)
USD 15 Mil USD 5 Mil committed by OFID
USD 20 Mil paid in increase to USD 27 mil
by end 2015 + Potential other Donors
(*) Investors are eligible for complimentary dividends
Target : 6m Libor + 1.5% 3 to 10 year maturity (*)
1% fixed return / 20 year maturity
Mezzanine Tranche
Target: 6mth Libor + 3.0% / 9 year maturity
Target: 6m Libor + 3.0%
up to 12 year maturity (*)
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Looking Ahead
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Innovative Blending
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No liability. Unless otherwise indicated, all figures are unaudited and not guaranteed. All information are provided with the understanding that BlueOrchard Finance Ltd or any related party is not rendering legal, accounting or other professional advice or opinions on specific facts or matters and accordingly assume no liability whatsoever. Any action derived from this publication is always at the recipient’s own risk. BlueOrchard Finance Ltd or any related party shall not be liable for any direct, indirect, incidental, consequential or any other damages arising out of or in connection with the use of any opinion or information contained herein.
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