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Peter johnson Presentation Transcript

  • 1. Microfinance Retail Funds Peter JohnsonPartner and Capital Markets Manager TBLI Asia September 15, 2011
  • 2. Microfinance Funds Channel Capital to Microfinance InstitutionsInvestors allocate capital to MIVs which invest in MFIs in developing countries• Microfinance Fund Mangers create investment vehicles to channel investor funds• Vehicles provide MFIs access to capital markets and funding to grow• MFIs provide financial services to entrepreneurs in developing countries• Investors target social impact and financial return MF Funds Investors Investment Vehicles debt, equity, hybrids & Microfinance others Institutions Microcredit BorrowersMFIs – Microfinance InstitutionsMIVs – Microfinance Investment Vehicles Securities transactions through DWM Finance LLC member FINRA/SIPC 2 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 3. Microfinance Investment Vehicles: Overview Estimated 102 MIVs globally with total assets under management of $6.8 billion1  MIVs provide debt, equity & guarantee financing to MFIs  Majority of MIV financing is through debt investments Financial Instruments MIV Total Assets Growth1100% (% of Microfinance Portfolio)1 86%75% Direct Microfinance 0.1% 8% Portfolio - Debt 10% Direct Microfinance50% Portfolio - Equity 34% 25% Direct Microfinance25% 21%2 Portfolio - Guarantees 10% Indirect Direct Microfinance Portfolio 0% 82% 2007 2008 2009 2010 2011 1 Source: Symbiotics MIV Survey, 2011 (as of 2011) 2 Survey Respondents forecast for 2011. Historical data refers to previous CGAP MIV surveys. Securities transactions through DWM Finance LLC member FINRA/SIPC 3 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 4. Microfinance Investment Vehicles: InvestorsRetail Investors and HNWI provide nearly one third of MIV funding Private Institutional Investors represent the largest share of investors across fund types, followed by High Net Worth Individuals (HNWI) and Retail Investors and then Public Sector Funders Sources of MIV Funding 100% 30% 30% 27% 31% 80% 60% Retail Investors & High Net 40% Worth Individuals 45% 61% Private Institutional 40% 60% Investors Public Sector Funders 20% 26% 31% 9% 13% 0% All MIVs Fixed Mixed Funds Equity Funds Income Source: Symbiotics MIV Survey, 2011 Funds Securities transactions through DWM Finance LLC member FINRA/SIPC 4 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 5. Microfinance Funds for Retail Investors and HNWI: ExamplesRetail Investors seek double bottom line of financial return and social impactOrganization Investment Target Annual Return1 Investor Location MinimumMicroPlace $20 1-3%2 USKiva $25 0% (principal repayment Global only) $250 ≤2% US, Canada,Oikocredit Europe, UK, Mexico, AsiaCalvert Foundation $1,000 1-5 year notes: USCommunity Investment Notes 0.5% - 2.0%responsAbility Global $1,000 Excess of money market EuropeMicrofinance Fund level in the fund currencyBlueOrchard Dexia $10,000 6M Libor + 1-2% US and EuropeMicrofinance Fund1 As of September 10, 20112 Depends on investment. Fixed returns range from 0.5%-3.5% with an average return of 1-3% stated. Securities transactions through DWM Finance LLC member FINRA/SIPC 5 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 6. The DWM Microfinance Fund – J: Overview Securities transactions through DWM Finance LLC member FINRA/SIPC 6 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 7. The DWM Microfinance Fund – J: OverviewDaiwa Securities and DWM launched the first commercial microfinance fund in Japan Net Asset USD 248 million  The $242 million Daiwa Value1 Microfinance Fund invested $236 million in its underlying Launch Date March 2011 investment vehicle, The DWM Microfinance Fund-J (DWMF-J) Only Open to Status Japanese  Distributed by Daiwa Securities Investors Co. Ltd. DFI Bonds &  DWMF-J makes only local Use of Proceeds Loans to MFIs currency debt investments Dividend Semi-annually Payment 1 As of 6/30/11 Securities transactions through DWM Finance LLC member FINRA/SIPC 7 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 8. Daiwa Microfinance Fund Historical NAV (¥) NAV Line  High on 4/11/11 10834.00 10800  Average 10102.29  Low on 09/09/11 9499.00 10600 10400 10200 10000 9800 9600 9499 9400 Securities transactions through DWM Finance LLC member FINRA/SIPC 8 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 9. DWMF-J Portfolio: OverviewPortfolio of local currencies from MFI loans and bonds issued by development finance institutions DWMF-J Exposure by Currency1 Azerbaijani Manat South African 2.8% Rand Costa Rican 19.2% Brazilian Real Colon 1.3% 20.6% Turkish Lira 4.1% Honduran Lempira 0.2% Hungarian Russian Ruble Forint 2.3% 19.4% Indonesian Indian Rupee Rupiah 3.9% 6.5% Peruvian Nuevo Jordanian Sol 3.2% Dinar 0.9% Mexican Peso Cambodian Riel 11.8% 0.9% Polish Zloty Mongolian 0.1% Tugrik 3.1%1 As of August 31, 2011 Securities transactions through DWM Finance LLC member FINRA/SIPC 9 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 10. About DWM: Investment Manager Track Record DWM Asset Management, LLC Fund Management $850+ million Microfinance Assets under Management1  Institutional-scale origination capacity & credit skills  Emerging Markets fund manager since 1994 1 As of 6/30/11 Experienced team with long careers in DWMs AUM (Millions) emerging markets investment banking & $1,000 $850 fund management $800 $640 Relationships with 400+ Microfinance $600 $600 $484 Institutions (“MFIs”) in over 80 countries $400 $333 Address full sweep of MFIs’ capital needs $200 Financial innovation – leader in creative $65 $0 microfinance transactions 2006 2007 2008 2009 2010 2011 Securities transactions through DWM Finance LLC member FINRA/SIPC 10 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 11. About DWM: DWM Aims to Deliver Social ImpactDWM MIVs have channeled over $850 million to approximately 140 MFIs in developing countries, impactingover 3 million micro-entrepreneurs and family members 3 million+ Investments in $850+ million DWM entrepreneurs and approximately 140 MIVs1 family members MFIs reached11 Assuming an average microloan size of $1000 and assuming an average family size of four in the countries in which DWM invests Securities transactions through DWM Finance LLC member FINRA/SIPC 11 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 12. Risks and DisclosuresOpinionAny statements of opinion constitute only current opinions of DWM Asset Management, LLC, which are subject to change and whichDWM Asset Management, LLC does not undertake to update.Portfolio HoldingsPortfolio data is “as of” the date indicated and should not be relied upon as a complete or current listing of the holdings of theportfolio. The holdings are subject to change without notice, and may not represent current or future portfolio composition.Some information in this report is based on unaudited information and is subject to change.Short Performance HistoryPerformance history of less than two years may not provide an adequate basis from which to determine the performance of a fund.Accordingly, such a short performance history should not be relied upon.Unaudited Information Subject to ChangeSome information in this report is based on unaudited information and is subject to change.Third Party InformationSome information contained herein has been obtained from DWM Finance, LLC and other third party sources and has not beenindependently verified by DWM Asset Management, LLC. DWM Asset Management, LLC makes no representations as to the accuracy orthe completeness of any of the information herein.Strategy/Process Risk DisclaimerPerformance is shown net of fees and expenses and includes the reinvestment of dividends and capital gain distributions. Many factorsaffect fund performance including changes in market conditions and interest rates and in response to other economic, political, orfinancial developments. Investment return and principal value of your investment will fluctuate, so that when you investment is sold,the amount you receive could be less than what you originally invested. Past performance is not a guide to or indicative of futureresults. Future returns are not guaranteed and a loss of principal may occur. No investment strategy or risk management technique canguarantee returns or eliminate risk in any market environment. Securities transactions through DWM Finance LLC member FINRA/SIPC 12 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 13. Risks and DisclosuresTHIS DOCUMENT DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY AN INTEREST IN THEINVESTMENTS DESCRIBED HEREIN. NO SUCH OFFER OR SOLICITATION WILL BE MADE PRIOR TO THE DELIVERY OF ANOFFERING MEMORANDUM AND OTHER MATERIALS RELATING TO THE MATTERS MENTIONED HEREIN.THIS DOCUMENT IS A SUMMARY, DOES NOT PUPORT TO BE COMPLETE, IS FOR DISCUSSION PURPOSES ONLY AND IS QUALIFIEDIN ITS ENTIRETY BY REFERENCE TO THE MORE DETAILED DISCUSSION CONTAINED IN THE ACTUAL OFFERING MATERIALS.NO REPRESENTATION OR WARRANTY IS MADE BY DEVELOPING WORLD MARKETS OR ANY OF ITS AFFLIATES (COLLECTIVELY,DWM), INCLUDING ANY OF ITS AGENTS OR OTHER REPRESENTATIVES, AS TO THE ACCURACY OR COMPLETENESS OF THEINFORMATION CONTAINED HEREIN. ONLY THOSE PARTICULAR REPRESENTATIONS AND WARRANTIES WHICH MAY BE MADE INDEFINITIVE AGREEMENTS RELATING TO THE FUND OR OTHER INVESTMENT DESCRIBED HEREIN, WHEN, AS AND IF EXECUTED,AND SUBJECT TO SUCH LIMITATIONS AND RESTRICTIONS AS MAY BE SPECIFIED IN SUCH DEFINITIVE AGREEMENTS, SHALL HAVEANY LEGAL EFFECT.THIS DOCUMENT IS BEING PROVIDED TO YOU ON A CONFIDENTIAL BASIS, ACCORDINGLY, THIS DOCUMENT MAY NOT BEREPRODUCED IN WHOLE OR IN PART, AND MAY NOT BE DELIVERED TO ANY PERSON WITHOUT THE PRIOR WRITTEN CONSENTOF DWM. COPYRIGHT 2011. Securities transactions through DWM Finance LLC member FINRA/SIPC 13 Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures
  • 14. Contact Information DWM Asset Management LLC 750 Washington Boulevard, Stamford, Connecticut 06901, USA www.dwmarkets.com Tel: +1.203.655.5453 Fax: +1.203.656.9528 FOR MORE INFORMATION CONTACT: Peter Johnson Hiroshi Amemiya Partner & Manager, Capital Markets Representative, Japan peter@dwmarkets.com hiroshi@dwmarkets.com Securities transactions through DWM Finance LLC member FINRA/SIPC Past performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures