Page 7 - Mfis

MFIs working on Rs 5-bn loan pool for sale to banks to ease liquidity

Kolkata, 7 NovemberTo overcome a liquidity problem in the sector, micro finance institutions (MFIs) are coming together to sell a bundled securitisation portfolio of about Rs 5 billion to banks.Loans in the books of MFIs will be consolidated in one pool. And, offered for sale to banks which will buy MFI portfolios. In general, banks buy such pools through bilateral or one-on-one deals, to meet their priority sector lending targets. According to a senior official of the MicroFinance Institutions Network (MFIN), about 70 per cent of the proposed pool will comprise the loan books of small and medium-sized entities. Participation from bigger and stronger MFIs will support the pool, as it will provide buyers the comfort of a good rating. MFIN is looking to complete the process in the next 10-15 days, said sources. The decision to create the pool was taken last Thursday, at a meeting called by MFIN with lenders, rating agencies and non-bank finance corporations (NBFCs) to discuss the ...

MFI liquidity crisis: Rs 5 bn needed next quarter; some freeze fresh loans

Even bigger MFIs have cut their fresh disbursement due to liquidity crunch

MFIs see slowdown in bank funding despite a fall in the cost of funds

The average cost of funds for MFIs is 12-15 per cent, depending on their size

MFIs need up to Rs 11,000 cr over next three years: Report

In FY17, MFIs and SFBs raised an aggregate of Rs 4,713 crore of equity capital

Recovery for Bharat Financial and Ujjivan some time away

Stocks of micro finance institutions (MFIs) and small finance banks (SFBs) are yet to pick up after a weak March quarter performance. Ujjivan Financial Services and Bharat Financial Inclusion have seen 6-11 per cent erosion in their stock prices since their Q4 results. It is anticipated that the recent developments, particularly on farm loan waiver, may put further pressure on these stocks. As it comes at a time when the overall collection efficiencies are improving, investors need to wait for more clarity on how these developments have affected the collection discipline. This is also an important monitorable as the collection efficiency in five key states - Maharashtra, Karnataka, Madhya Pradesh, Gujarat and Uttar Pradesh, are yet to show a strong recovery. A recent report by India Ratings & Research (Ind-Ra) highlights that these states account for 90 per cent of the total default in stressed transactions where the payment period has been less than nine months and are rated by ..

Note ban impact: Rising defaults by MFI borrowers turn investors cautious

Securitisation volumes drop 20% in F&17 after two years of rapid growth

Pending repayments remain high for MFIs: RBI staff report

MFIs faced problems in getting repayment in some pockets of India because of currency shortage

MFIs to face asset quality woes

Rising political risks could weigh on Bharat Financial Inclusion, Equitas and Ujjivan

Banks seek to forge alliances with MFIs

While many deals have already been signed, industry experts say more partnerships are in the offing

MFI sector worth seen trebling at Rs 4.3 trillion in 4 years: Icra

Estimate includes micro credit across self-help groups, MFIs and banks

PEs exit from MFIs with manifold returns

Equitas Holdings during its initial public offering earlier this month saw 10 investors exiting with returns ranging from two to 13 times