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Last Updated : Sep 05, 2011 08:51 PM IST | Source: PTI

IFC extends Rs 135cr to Bandhan MFI

In a much-needed succour to the troubled micro-finance space, West Bengal-based micro lender Bandhan today said it has got a Rs 135-crore equity infusion from the investment unit of the World Bank.


In a much-needed succour to the troubled micro-finance space, West Bengal-based micro lender Bandhan today said it has got a Rs 135-crore equity infusion from the investment unit of the World Bank.


The funds from International Finance Corporation (IFC) will augment Bandhan's capital base and also help the micro lender reach out to an additional 1 million poor women, the company said in a statement.


The investment will also help Bandhan shore up its networth to nearly Rs 650 crore by next March.


"Bandhan is projected to reach out to 6.5 million customers with a loan-book of Rs 5,000 crore. It will also maintain the minimum capital adequacy ratio (CAR) of 17%," the statement said, without giving a timeline. It also
did not mention the exact stake which IFC picks up in the MFI.


The investment is the single biggest exposure in the MFI space for IFC, the statement said, adding the last round of equity infusion for Bandhan was a Rs 50 crore funding from Sidbi in December, 2009.


The once-darling MFI space has been facing troubles for over the past one year after repayment issues were witnessed in the largest MFI market Andhra Pradesh, following new restrictions imposed on them by the state administration to curb malpractices. Following the troubles, banks have also
grown wary of disbursing loans to the sector.

Some of Bandhan's peers have already sounded the death-knell.

First Published on Sep 5, 2011 08:32 pm
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