SKS Micro first MFI rated pool assignment transaction post-Malegam panel recommendations

• Portfolio rated as PR 1 + SO Highest Safety by CARE

SKS Microfinance Limited today announced the completion of the first rated pool assignment (securitization) for the microfinance sector after the notification of Malegam Committee Recommendations.

The rated pool assignment transaction of Rs 50 crore comprises 65,438 contracts rated PR1+(SO) by CARE, with Yes Bank. This assignment follows a securitization of a pool of Rs 550 crore with assignee banks earlier this month.

Commenting on the assignment, Mr S Dilli Raj, CFO – SKS Microfinance Ltd, said, “The development reiterates SKS Microfinance’s leadership position in the MFI sector and the confidence of the financial world in the MFI model followed by the company. ”

Instruments with a PR1+ (SO) rating are considered to have a strong capacity for timely payment of short term debt obligations and carry the lowest credit risk.

The securitization is of receivables from 7,30,000 micro borrowers as defined by the RBI. Pool receivables are identified from 18 non AP states where SKS operates. The pool is well diversified with a single branch accounting of less than 1% of the pool, with the average loan amount being Rs 12,000.

About SKS Microfinance Limited:
SKS Microfinance Limited (SKS) is a non-banking finance company (NBFC), registered and regulated by Reserve Bank of India, whose mission is to eradicate poverty by providing financial services to the poor.

SKS operates across 19 states of India. They include: Andhra Pradesh, Karnataka, Maharashtra, Orissa, Madhya Pradesh, Bihar, Uttar Pradesh, Rajasthan, Uttaranchal, Himachal Pradesh, Haryana, West Bengal, Jharkhand, Chhattisgarh, Gujarat, Kerala, Tamil Nadu, Punjab and Delhi.

SKS has been recipient of many awards, which include Social and Corporate Governance Award by BSE, NASSCOM Foundation for Best Corporate Social Responsibility Practice (2007), Social Performance Reporting Award (MFIs) - Silver Category for Social Performing rating conducted by MIX market (2009) etc. SKS was founded by Dr Vikram Akula, who has been conferred the award of Young Global Leader by World Economic Forum and Business Transformation Entrepreneur of the Year by Ernst & Young (2010).  He was named by TIME magazine as one of the 100 Most Influential People in the World (2006).