Microfinance News Synopsis: SKS MF gets Sebi nod for IPO; issue likely by end-July

Microfinance Focus, July 12, 2010: Microfinance News Synopsis brings a compilation of industry headlines broadcasted by other news media from across the world.

SKS MF gets Sebi nod for IPO; issue likely by end-July: India’s largest microfinance firm, SKS Microfinance is likely to hit the market with its proposed initial sharesale by the end of this month after market-regulator Securities and Exchange Board of India okayed the proposal last week, a source said. “The company has received the approval from Sebi last Tuesday. The issue should hit the market by the end of this month,” a source close to the development said in Mumbai. SKS plans to raise between Rs 1,000-Rs 1,500 crore to meet its expansion plans through the share sale, which will be the first-ever IPO by a micro finance institution in the domestic market. Venture capital firm Sequoia is the largest shareholder in the firm while other major stakeholders include Kismat Capital, Mutual Benefit Trust and Sandstone amongst others [Economic Times]

Financial wizards see big career growth in MFIs: A number of financial executives across the country are now migrating to the microfinancing sector. Executives, who have moved into this segment, say that at a time when a number of industries were bleeding during the economic slowdown, the microfinance sector managed to increase its compensation by an average of 8.1% for its employees at the higher and lower end. “Over the past two years, many financial executives have chosen microfinancing as their career option. Not only that, many of them have even started their own ventures across the country. A slew of employees from Citibank, HDFC and Cholamandalam have also migrated into this segment,” said Arjun Muralidharan, chief executive officer of Trichy-based Grama Vidiyal Micro Finance. “With the sector turning mature year-on-year, there is a tremendous potential in this segment [Economic Times]

Microfinance group wary of conflicts in the ARMM: Groups catering to the financing needs of the poorest of the poor admitted having a hard time bringing their services to the Autonomous Region in Muslim Mindanao (ARMM) because of the high risk and the high cost it entails. Jeffrey Ordonez, executive director of the Mindanao Microfinance Council, said problems on peace and order make the ARMM a very high risk for microfinance lending. In fact, non government organizations involved in micro-financing had to allocate bigger resources when they choose to enter the ARMM because of the high risk involved, he said.“Since we started, we have always strived to provide micro financing in Mindanao, especially in areas less covered,” Ordonez said. “But we’ve been having problems in penetrating the ARMM, especially in such towns as Lanao and Maguindanao [Davao Today]

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