Of the company’s existing shareholders, the German development and promotional bank
KfW Bankengruppe, the Dutch development bank FMO, the member of the World Bank
Group IFC and the Swiss microfinance fund responsAbility participated in the capital
increase.
Two new American investors joined the group of shareholders by purchasing non-voting
preference shares with a total value of EUR 40.5 million: TIAA-CREF, a US financial services
organisation, and the Omidyar-Tufts Microfinance Fund, established in 2005 by a gift to Tufts
University from Pierre and Pam Omidyar.
“TIAA-CREF and the Omidyar-Tufts Microfinance Fund are strong partners from the private
sector who share our twin objectives: to promote economic development by supporting small
businesses, and, at the same time, to earn an adequate return on investment. ProCredit is a
rapidly growing and profitable group of banks. We have a range of options to raise new
capital, but in choosing new shareholders, the most important criterion is that they
demonstrate a genuine commitment to our goals,” said Claus-Peter Zeitinger, Chairman of
the Supervisory Board of ProCredit Holding. “The substantial investments by our new
shareholders show that it is possible to raise capital from like-minded private-sector sources
to support microfinance on a large scale,” he added.
The additional capital will be used to finance the expansion of the group, which currently
operates in 18 countries in Africa, Latin America and Eastern Europe. Plans call for further
institutions to be established in the near future in Sierra Leone, Honduras and Mexico. The
group will thus enable a steadily growing number of small entrepreneurs and low-income
households to gain access to formal financial services.
As of the end of July 2006, the institutions of the ProCredit group had a total loan portfolio of
EUR 1.8 billion outstanding to more than half a million micro and small entrepreneurs in
developing countries and transition economies. Total savings deposits across the group
came to EUR 1.5 billion. The ProCredit group has been remarkably successful in attracting
savings deposits from lower-income households: 80% of the deposit accounts contain
balances of less than EUR 100. These small savings amounts are a further reflection of the
fact that the ProCredit banks – which are modelled on Germany’s “Sparkassen”, or savings
and loan associations – have a strong orientation towards the sort of “responsible banking”
which promotes economic development.
