34502 - Fullerton Finance (Myanmar) Company Limited Equity

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Summary of Investment Information

Project Number

34502

Company Name

FULLERTON FINANCE MYANMAR CO LTD

Date SPI Disclosed

Jan 7, 2015

Country

Myanmar

Region

East Asia and the Pacific

Projected Board Date

Feb 9, 2015

Environmental Category

FI-3 - No Impact

Status

Completed

Last Updated Date

Feb 15, 2023

Department

Regional Industry - FIG Asia & Pac

Industry

Financial Markets

Previous Events

Approved : Jun 24, 2015
Signed : Dec 4, 2015
Invested : Dec 16, 2015

Sector

Microfinance and Small Business - Non Commercial Banking

Project Description

This Project proposes to invest up to US$1.2 million in Fullerton Finance (Myanmar) Company Limited (“FFMCL” or “The Company”).
FFMCL is a greenfield microfinance institution incorporated in Myanmar in 2013. It was set up by Sittoung Investments Pte. Ltd., a wholly owned subsidiary of Fullerton Financial Holdings Pte. Ltd. (“FFH”) organized under the laws of Singapore. In May 2014, it obtained its license to operate a microfinance loan and deposit taking business, and disbursed its first loans in November 2014.
FFMCL plans to start up a 12-branch operation within 2 years and will expand extensively its network throughout the country for the next 8 years, operating across several provinces with additional new branches. FFMCL plans to create an estimated 1,600 new jobs and reach out to at least 331,000 customers.
Through the project, together with the advisory services, IFC’s investment aims to support FFMCL to expand into the untapped market and reach underserved clients, strengthen its risk management strategy and become sustainable microfinance institution.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	1.40

Development Impact

- Respond to unmet demand for microfinance: FFMCL plans to start up a 12 branch operation within 2 years in 3 provinces Yangon, Mandalay and Ayeryawaddy. As the operating environment improves, FFMCL aims to expand extensively its network across the country, for the next 8 years, subject to the approval of the regulators and the Board of Directors of FFMCL, through which it aims to reach out to at least 331,000 customers.
- Contribute to the development of the financial and microfinance sector in Myanmar. The access to financial services is currently very limited, FFMCL is expected to actively develop the microfinance market in Myanmar and contribute to the improvement of financial market practices, deepening of the financial sector.
- Development of new microfinance and financial products: FFMCL will use technology to develop new ways to provide secure microfinance services. They will also offer microfinance and other financial products across both the urban and rural environments, which will provide better access to finance for borrowers at the bottom of the pyramid.

- IFC provides long-term funding to support the growth of sustainable and commercially viable microfinance lending practices in Myanmar.
- IFC has a broad range of institutional and financial sector building experience in emerging markets. Through this investment, IFC can transfer its know-how and expertise in emerging markets into a new untapped market by promoting best practices.

E&S Category Rationale / Risks and Mitigation

This project entails an equity investment of up to US$1.2 million to support FFMCL, a new microfinance institution in Myanmar. The project has been categorized as FI-3 in accordance with IFC Environmental and Social Review Procedure. FFMCL is a microfinance institution with a focus on individual and group lending for mostly agriculture and consumer service sectors. The activities to be supported by this project entail minimal potential E&S risk and impact. For this project, FFMCL will be required to develop and implement an environmental and social management system (ESMS) to manage its lending operation. Given the under-developed E&S regulatory system in Myanmar and in line with IFC’s approach, FFMCL will be required to apply IFC extended Exclusion List for its lending operation. FFMCL was found to be generally in line with the requirements of IFC Performance Standard 2 Labor and Working Conditions for its own operation.

Contacts

For Inquiries About the Project, Contact

Mr. Kenny OngExecutive Vice President, Head of Business Development and New VenturesFullerton Financial Holdings Pte. Ltd.60B Orchard Road #06-18 Tower 2The Atrium@Orchard, Singapore 238891Tel: +65 6828 6828Fax: +65 6821 1183Email: mailto:corpcomm@fullertonfinancial.comWebsite: http://www.fullertonfinancial.com

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This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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