BRAC officials in Colombo to discuss Nanda Investment’s future with LOLC
View(s):Top officials from Bangladesh-based BRAC, one of the world’s largest micro financing providers, were arriving in the country today to discuss the strategic direction of Nanda Investments and Finance PLC (Nanda Investments they acquired with LOLC recently, LOLC officials said.
“BRAC Chairman, Sir Fazle Hasan Abed is due to arrive today (Sunday),” a LOLC official told the Business Times. He said BRAC officials and their LOLC counterparts will start meetings tomorrow. “They will change the name (of Nanda Investments) and it will reflect BRAC more as it is the largest development organisation in the world in terms of the scale and breadth of its operations and was founded 10 years ago in Bangladesh, by Sir Abed,” the official said.
BRAC reaches the less privileged communities across the globe through microfinance, education, healthcare, legal services, community empowerment and more catalyzing lasting change, creating an ecosystem in which the less privileged have the chance to seize control of their own lives. Through this initiative, BRAC has reached and touched the lives of an estimated 126 million people, spanning across 11 countries in Asia and Africa and the Caribbean. BRAC with its 100,000 employees dedicated to spread anti-poverty in the world focuses on social and financial empowerment of women, healthcare and education, empowering farmers though inclusive financial solutions not only catering to financial needs but also improving livelihood and financial literacy among the less privileged.
The official said that LOLC’s micro financing comes in two varieties:
asset-backed and income-backed. “Our group loan model is somewhat different to the popular Grameen Bank model. We have a smaller group with a speedier and more effective step-up loan cycle. At present, 95 per cent of our group loan portfolio graduate to individual borrowers.
This opportunity not only empowers working women in the microfinance sector, but also facilitates their transition to an SME entrepreneur, alleviating poverty and uplifting the living standards of their families,” he said. The transaction will transfer 90.6 million shares with 56.6 per cent stake of Nanda Investments to BRAC while LOLC has a stake of 33.4 per cent. LOLC is expected to make this equity investment through its fully owned subsidiary, LOLC Micro Investments Ltd. Nanda Investments is a registered finance company listed in the Colombo Stock Exchange with a lending portfolio of Rs. 290 million and a fixed deposit base of Rs 88 million. The total assets of the company as at 31st March 2013 were Rs 663 million.
A media release from LOLC said that in the medium term it is expected that BRAC and LOLC will invite Netherlands-based Triodos Bank to invest in a stake of 10 per cent and the new shareholder is expected to spearhead the provision of micro funding to fuel portfolio growth, the official said.
BRAC will extend its current business model together with the backing of its global business operations platform while LOLC will play a key role in providing the know-how on the local micro credit business, the official said. Together with Triodos Bank, this partnership will flourish as a strong micro finance company with a sustainable business model of providing financing to less privileged rural community, the official said.
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