Summary of Proposed Investment
Project Number
11337
Company Name
Equator Capital Partners LLC
Date SPI Disclosed
Dec 12, 2002
Country
World Region
Industry
other
Projected Board Date
Jan 31, 2003
Status
Completed
Sector
Private Equity/Venture Cap Fund - Sector
Department
Equity Portfolio Management
Environmental Category
FI
Previous Events
Approved : Jun 10, 2003
Signed : Sep 30, 2003
Invested : Nov 14, 2003
Project Description
The project is to establish an investment company, SCI, that will provide financing for sustainable micro and small business financial institutions so that they can increase their customer base and reach more potential clients who currently do not have access to traditional formal financial services. Through its role on investee boards, SCI will provide governance support. SCE, the parallel technical assistance facility, will provide a range of strategic and operational assistance in areas such as new product development, MIS and others. SCE will have direct access to Shorebank''s and SAS''s extensive experience and will also be able to draw from external best practice expertise.
Development Impact
- Increased availability of financing and demonstration effect. SCI''s investments in sustainable MFIs will increase the availability of financial services to micro and small businesses in the target regions. There will also be a demonstration effect, particularly in young commercial microfinance markets, as investee companies develop into sustainable formal financial intermediaries.
- Private Sector Development , Economic and Living Standards Contribution. Microenterprises and small businesses account for the major share of the private sector and employment in many developing countries. Yet, despite the size of the sector and its importance for the economy, these businesses rarely have access to the savings, credit and payment services provided by formal financial institutions, that are necessary for growth and employment creation. By expanding the scale and outreach of financial services to these businesses, the project will make a significant contribution to the improvement of economic and living standards of low-income populations in developing countries.
IFC Role
IFC’s solid track record as a risk-taking investor, strategic advisor, and technical assistance provider to the financial services industry places it in a unique position to provide comfort to other investors, acting as anchor investor and participating in the growth and development of the industry at this critical stage of its evolution.
IFC also has an important role in the structuring of the company, drawing on lessons learned in its other wholesale microfinance investment vehicles. The sponsor has incorporated such ''best practices'' in the structuring of this project, to align its interest with those of other investors. IFC will also play an important governance role through its participation in the company''s board of directors.
Development Impact
- Increased availability of financing and demonstration effect. SCI''s investments in sustainable MFIs will increase the availability of financial services to micro and small businesses in the target regions. There will also be a demonstration effect, particularly in young commercial microfinance markets, as investee companies develop into sustainable formal financial intermediaries.
- Private Sector Development , Economic and Living Standards Contribution. Microenterprises and small businesses account for the major share of the private sector and employment in many developing countries. Yet, despite the size of the sector and its importance for the economy, these businesses rarely have access to the savings, credit and payment services provided by formal financial institutions, that are necessary for growth and employment creation. By expanding the scale and outreach of financial services to these businesses, the project will make a significant contribution to the improvement of economic and living standards of low-income populations in developing countries.
IFC Role
IFC’s solid track record as a risk-taking investor, strategic advisor, and technical assistance provider to the financial services industry places it in a unique position to provide comfort to other investors, acting as anchor investor and participating in the growth and development of the industry at this critical stage of its evolution.
IFC also has an important role in the structuring of the company, drawing on lessons learned in its other wholesale microfinance investment vehicles. The sponsor has incorporated such ''best practices'' in the structuring of this project, to align its interest with those of other investors. IFC will also play an important governance role through its participation in the company''s board of directors.
Sponsor / Cost / Location
Development Impact
Related ESRS/ERS
Contacts
For Inquiries About the Project, Contact
Mary Houghton
President
Shorebank Corporation
7054 South Jeffery Blvd.
Chicago, IL 60649
Fax: 773 493 6609
President
Shorebank Corporation
7054 South Jeffery Blvd.
Chicago, IL 60649
Fax: 773 493 6609