Surviving
Microfinance
in


These
Trying
Times
Atty. Nicolas J. Lim
President/CEO,1st Valley Bank, Inc.



                ...
1st Valley Bank, Inc.
 •  Established in 1956
 •  Formerly known as Rural Bank of Kapatagan
    Valley, Inc. (RUBANKA)
 • ...
Branch Offices




       1st Valley Bank, Inc.
MF Programs with MABS

•  FAME (Financial Assistance to Micro-
   Entrepreneurs)
     Introduced in July 1999
•  MAP (Mic...
Microfinance Operations
                          (as of Dec 2008)
No. of Branches                                   19
No...
Selected Bankwide Indicators

                                        1999                     Net Change
  Performance Da...
External Challenges to our Operations




       1st Valley Bank, Inc.
Legacy Issue:

       Lower Client's Trust in the RB Industry


          Massive Withdrawals - Bank Run


               ...
Global Financial Crisis:




       1st Valley Bank, Inc.
1VB STRATEGIES

 •  Robust Organizational Structure
 •  Generalist vs Specialist
 •  Increase the number of training focus...
Other Initiatives
 •  Review Priority Programs
 •  Regularly Monitor Controllable Expenses
 •  Intensify recovery of forec...
It’s Time to Go Back to Basics:

 •  Zero Tolerance to delinquency
 •  Start small loans, step up
 •  Shorter terms for fa...
Microfinance Best Practices
is still the best weapon we have.

                  Stick to them




    1st Valley Bank, In...
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Surviving Microfinance in these trying times

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Surviving Microfinance in these trying times

  1. 1. Surviving
Microfinance
in

 These
Trying
Times Atty. Nicolas J. Lim President/CEO,1st Valley Bank, Inc. 2009 RBAP-MABS National Roundtable Conference May 12-13, 2009 Hyatt Hotel and Casino Manila
  2. 2. 1st Valley Bank, Inc. •  Established in 1956 •  Formerly known as Rural Bank of Kapatagan Valley, Inc. (RUBANKA) •  The biggest in Northwestern Mindanao. •  Rated A+(rb) by the PhilRatings system. •  Hall of Fame Awardee, Most Outstanding RB, National Level by Land Bank of the Philippines •  80% of the branches are in the rural areas. 1st Valley Bank, Inc.
  3. 3. Branch Offices 1st Valley Bank, Inc.
  4. 4. MF Programs with MABS •  FAME (Financial Assistance to Micro- Entrepreneurs)   Introduced in July 1999 •  MAP (Micro-Agri Loan Product)   Started in 2004. •  Mobile banking technology- sinceJuly 2006   (TextAPayment; TextADeposit; TextASalary) 1st Valley Bank, Inc.
  5. 5. Microfinance Operations (as of Dec 2008) No. of Branches 19 No. of Account Specialists 26 No. of Borrowers 4,387 Loan Portfolio Balance P47.74 M Cum. No. of Clients Served 10,920 Cum. No. Loans Disbursed since 1999 49,676 Cum. Amount of Loans Disbursed P782.78 M No. of micro-deposit accounts 89,109 Total amount of micro-deposits P105.69M Portfolio-at-Risk Rate, 30 days (PARR30) 2.75% 1st Valley Bank, Inc.
  6. 6. Selected Bankwide Indicators 1999 Net Change Performance Data (start of MF Dec.08 1999 to Operations) Dec2008 Branch offices 6 19 183% No. of employees 79 327 314% Total Resources P251.17 M P2.68B 1066% Total Loans P217.02 M P2.16B 895% Total Deposits P88.42 M P1.56B 1664% Total Capital P46.99 M P354.97 M 655% Net Income, after Tax P6.51 M P 64.73 M 894% 1st Valley Bank, Inc.
  7. 7. External Challenges to our Operations 1st Valley Bank, Inc.
  8. 8. Legacy Issue: Lower Client's Trust in the RB Industry Massive Withdrawals - Bank Run Liquidity Problems Recapitalization / Prohibited from Operating 1st Valley Bank, Inc.
  9. 9. Global Financial Crisis: 1st Valley Bank, Inc.
  10. 10. 1VB STRATEGIES •  Robust Organizational Structure •  Generalist vs Specialist •  Increase the number of training focusing on Operational Efficiency •  Realign Targets 1st Valley Bank, Inc.
  11. 11. Other Initiatives •  Review Priority Programs •  Regularly Monitor Controllable Expenses •  Intensify recovery of foreclosed assets and other collectibles •  Widen sourcing of credit lines •  Prepare Notes for Rediscounting •  And Training…Training… Training… and a lot more to be done 1st Valley Bank, Inc.
  12. 12. It’s Time to Go Back to Basics: •  Zero Tolerance to delinquency •  Start small loans, step up •  Shorter terms for fast recovery of funds •  Small frequent amortization payments •  Focus on character and cash flow rather than collateral •  Strict adherence to policies and standards •  Take care of your staff, they are your business centers 1st Valley Bank, Inc.
  13. 13. Microfinance Best Practices is still the best weapon we have. Stick to them 1st Valley Bank, Inc.

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