Microfinance Forum 2008 (3.Planet Rating Presentation)

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2008年11月28日に世界銀行東京ラーニングセンターで行われたマイクロファイナンス・フォーラムの資料です。

3.Planet Rating Presentation

格付けの方法論、マイクロファイナンスビジネスにおける用途、業界の展望について
Otto Wormgoor 氏(Planet Rating オペレーション マネージャー)

※Living in Peace(リビング・イン・ピース)について
本フォーラムの主催団体であるLiving in
Peaceは、経済開発に関心のある金融機関関係者を中心に2008年10月に設立されました。その他にも公務員、国際機関関係者、学生などがメンバーになっており、2009年4月にNPO法人格を取得いたしました。また現在、ミュージックセキュリティーズと提携してマイクロファイナンス・ファンドの組成準備中です。(HP:http://www.living-in-peace.org/
旧Blog;http://d.hatena.ne.jp/microfinance/)

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Microfinance Forum 2008 (3.Planet Rating Presentation)

  1. 1. November 28th 2008 Evaluating risks in microfinance Presented by: Otto Wormgoor – Operations Manager owormgoor@planetrating.com Planet Rating Accredited by CGAP Rating Fund 13 rue Dieumegard Société par Actions Simplifiée au capital de 580 000 EUR Saint Ouen - France Immatriculée sous le n° 483 538 369 R.C.S. Bobigny t:+ 33 1 4921 2630 rating@planetrating.com www.planetrating.com
  2. 2. Planet Rating November 28th 2008 Evaluating Risks in Microfinance 1
  3. 3. Planet Rating: The Global Microfinance Rating Agency Created in 1999 and became a private independent rating firm in June 2005 Created in 1999 and became a private independent rating firm in June 2005 Planet Rating has the most extensive global coverage:  Paris HQ: covering Eastern Europe & Asia  Beirut Office: covering North Africa & Middle East  Lima Office: covering Latin America & the Caribbean  Dakar Office: covering West & Central Africa  Kampala Office: covering East & Southern Africa  Manila Office: covering Asia [Opening January 2009] Offices Missions Most diversified rating team in the industry:  Multicultural: American, Canadian, Colombian, Dutch, French, Lebanese, Senegalese, Spanish, Ugandan, Peruvian, Vietnamese citizens  Multilingual: Arabic, Dutch, Italian, English, French, Lugandan, Spanish, Wolof speakers Qualified & experienced team:  Each senior analyst has conducted at least 12 rating missions on 3 different continents  Analyst backgrounds: investment banking, management consulting, non-profit, microfinance November 28th 2008 Evaluating Risks in Microfinance 2
  4. 4. Global Recognition & Global Experience In 2008, Planet Rating is ranked… In 2008, Planet Rating is ranked…  # 1 microfinance rating agency in Middle East & North Africa  # 1 microfinance rating agency in Africa  # 2 microfinance rating agency in Eastern and Central Europe & NIS  # 2 microfinance rating agency in Latin America and # 1 in Brazil  # 2 microfinance rating agency in Asia-Pacific … and holds a strong rating experience of various types of microfinance organizations … and holds a strong rating experience of various types of microfinance organizations  Our rating team has developed its expertise through missions within:  Mature regulated MFIs, such as Mikrofin (Bosnia Herzegovina), UML (Uganda)  Smaller unregulated MFIs, such as Ugafode (Uganda), TYM Fund (Vietnam)  Deposit-taking institutions and cooperatives, such as Kafo Jiginew (Mali)  Banking institutions, such as Socremo Bank (Mozambique), XacBank (Mongolia), Banco de Desarollo (Chile) and Ecofuturo (Bolivia)  International organizations and donors have trusted us to evaluate their partner MFIs:  USAID in Mali & Egypt  EU/SUFFICE and DFID/FDSU in Uganda  Luxemburg cooperation agency in Senegal  Islamic Development Bank in Palestine November 28th 2008 Evaluating Risks in Microfinance 3
  5. 5. Knowledgeable & Committed Shareholders Planet Rating is backed by solid shareholders Planet Rating is backed by solid shareholders PlaNet Finance (www.planetfinance.org)  A leading French NGO that aims to alleviate poverty worldwide through the development of microfinance  Paris-based with 539 employees in 38 countries; 2006 resources of 7.2 million EUR COFACE Group (www.coface.com)  COFACE provides 4 product lines: credit information and corporate ratings, receivables management, credit/guarantee insurance, export guarantees and factoring. FitchRatings (AA+), S&P (AA), Moody’s (Aa3).  Paris-based with 5,500 employees in 60 countries; 2006 revenues of 1.34 billion EUR CDC Group (www.caissedesdepots.fr)  CDC Group is the leading French manager of public savings deposits and pension funds. It is also a leading investor in social housing and regional/local development projects throughout France. FitchRatings (AAA)  Paris-based with 5000 employees; 2006 assets of 200 billion EUR and net income of 2.1 billion EUR Viel & Co. Finance (www.viel.com)  VIEL & Cie is one of the world's top three brokers in financial (money markets, bonds, interest rate, currency/ credit derivatives, equities, equity derivatives, interest rate & index futures) and commodity-related products.  Paris-based and Euronext-listed, VIEL operates in 18 countries; 2007 revenues of 676 million EUR November 28th 2008 Evaluating Risks in Microfinance 4
  6. 6. Evaluating Risks in Microfinance November 28th 2008 Evaluating Risks in Microfinance 5
  7. 7. GIRAFE Methodology Highlights Highlights  Created in 1999, it is the most comprehensive and transparent rating methodology  Certified and accredited by CGAP and the Rating Fund  Widely recognized worldwide by investors, donors, regulators and microfinance consultants  Specifically designed and adapted to microfinance, relevant to suit all types, sizes and stages of development of MFIs  Proven and stable methodology already employed for more than 350 ratings in over 60 countries  An enhanced GIRAFE methodology was finalized in January 2008 in order to anticipate future microfinance rating risks and challenges Rating Domains Weightings G overnance 24% Qualitative I nformation 10% domains R isk Management 10% A ctivities 20% F unding and liquidity 14% Quantitative domains E fficiency and profitability 22% November 28th 2008 Evaluating Risks in Microfinance 6
  8. 8. GIRAFE Rating Domains (1/3) GIRAFE is a comprehensive rating methodology GIRAFE is a comprehensive rating methodology Governance and Decision Making 24%  Decision making  Strategy & Planning  Management Team  Human Resources Management Information and Systems 10%  Information system design  Information quality  Use of information November 28th 2008 Evaluating Risks in Microfinance 7
  9. 9. GIRAFE Rating Domains (2/3) GIRAFE is a comprehensive rating methodology GIRAFE is a comprehensive rating methodology Risk Management 10%  Procedures and Internal Controls  Internal Audit Activities 20%  Financial services management (credit, deposit taking, money transfer, insurance)  Credit risk  Risk coverage November 28th 2008 Evaluating Risks in Microfinance 8
  10. 10. GIRAFE Rating Domains (3/3) GIRAFE is a comprehensive rating methodology GIRAFE is a comprehensive rating methodology Funding & Liquidity 14%  Capital adequacy and Funding strategy  Asset & Liability Management and Liquidity risk  Market risk: Interest rate risk & FX risk Efficiency & Profitability 22%  Return on Assets  Revenue quality  Operational Efficiency November 28th 2008 Evaluating Risks in Microfinance 9
  11. 11. GIRAFE Rating Scale GIRAFE rating grid GIRAFE rating grid A++ Optimal institutional, operational and financial performances. No downside risk in the short-term. Well-designed medium and long-term plans. Excellent execution capacity and goals very likely to be achieved. Minimal and/or well Investment grade managed short and medium term risks. Well monitored and anticipated LT risks. High resilience to external crisis. A+ Excellent institutional, operational and financial performances. Well-designed medium and long-term plans, A excellent execution capacity and goals very likely to be achieved. Well monitored and anticipated LT risks. Minimal A- and/or well managed short and medium term risks. Limited impact of external crisis given the MFI ability to quickly adjust its strategies and/or take corrective actions. B++ Satisfactory institutional, operational and financial performances. Adequately designed medium and long-term B+ plans, good execution capacity and goals likely to be achieved. Low and/or well managed short and medium term B risks. Areas for improvements identified and being addressed. Moderate impact of external crisis. Close to industry standards institutional, operational and financial performances. Moderate but not fully addressed B- short and medium term risks. Most areas for improvements have been identified, but medium and long term plans Speculative Investment miss one or several critical elements. Uneven execution capacity and some goals unlikely to be achieved. Vulnerable to external crisis. C++ Limited Institutional, operational and financial performances when compared to industry standards. Moderate/high C+ and not fully addressed short and medium term risks. Most areas for improvements have been identified, but C medium and long term plans miss one or several critical elements. Weak execution capacity and many goals unlikely C- to be achieved. Very vulnerable to external crisis. D High risk: Important weaknesses in operational and financial areas result in high institutional vulnerability and potential risk of default. Performance is very poor in several important evaluation areas. Risk E Immediate risk of default: Existing operational and/or financial and/or strategic weaknesses create an outstanding risk of default. Performance is very poor in most evaluation areas. November 28th 2008 Evaluating Risks in Microfinance 10
  12. 12. GIRAFE Rating Report Clear and straightforward rating reports Clear and straightforward rating reports Reading a rating The first page of our reports provides the rating results at a glance on different levels Description of the institution GIRAFE Rating: - Grade Rating highlights - Trend - Date Circle graph Outlook Performance indicators November 28th 2008 Evaluating Risks in Microfinance 11
  13. 13. Microfinance Rating vs. Credit Risk Rating Differences and commonalities Differences and commonalities  Microfinance Risk Rating  Credit Risk Rating Probability of default based on a more in- Probability of default based on historic   depth analysis on good performance and default trends operational risk Deep microfinance industry knowledge General fundamental analysis   More thorough analysis of Governance, Analysis of Governance, Management,   Management, Credit Risk and Profitability Credit Risk and Profitability Strong focus on performance and Strong focus on financial buffers as an   operational risk as an indication of default indication of default risk: risk: Liquidity risk — Internal controls, Internal audit Capital adequacy & capacity of loss — — Loan portfolio management absorption by equity — Focus on specific risks in MFIs:  Information management — November 28th 2008 Evaluating Risks in Microfinance 12
  14. 14. Social Performance Rating November 28th 2008 Evaluating Risks in Microfinance 13
  15. 15. Social Performance Rating Methodology We value what we measure: measure your social performance! We value what we measure: measure your social performance!  For most MFIs, institutional sustainability is only a means to an end: achieving their social goals.  MFI usually have a social goal which is to create a social impact such as “alleviate poverty” or “participate in the economic development” or contribute to “women empowerment”  Their social mission is to provide microfinance services (efficient and adapted financial services offered to those that are excluded by the traditional financial sector) to a target clientele as a tool to reach that goal  Rating constraints rule out the rating of the social impact dimension (understood as the effects of microfinance on clients’ living conditions) of social performance  But rating can provide an opinion on “the likelihood that the MFI produces significant social impact both now and in the future”.  Our ratings will not evaluate whether the MFI has reached its social goal, but whether it is likely to do so because it has implemented its social mission in a satisfactory way. November 28th 2008 Evaluating Risks in Microfinance 14
  16. 16. Social Performance Rating Methodology Highlights Highlights  The Social Performance Rating methodology has been rigorously designed  Refined through on-site testing and collection of feedback from actors of the sector during 2005 and 2006  Final methodology already used for twenty Social Performance Ratings in Eastern Europe, Africa and Latin America Rating Domains Social Performance Rating scale  Institutionalization of the Social Mission 5 - Advanced  Targeting and Service Offering 4 - Convincing  Social Responsibility 3 – In Progress 2 - Incipient 1 - Intangible November 28th 2008 Evaluating Risks in Microfinance 15
  17. 17. Thank You !! Contacts Contacts  Global Headquarters  Middle East & North Africa 13 rue Dieumegard Piccadilly Building #407 93400 St-Ouen Paris – France Hamra Street Tel: +33 1 4921 2630 Beirut – Lebanon Fax: +33 1 4921 2627 Tel: +961 3 11 96 81  Latin America  West Africa Francisco de Paula Ugarriza 813 – Oficina 301 Boulevard Djily Mbaye Miraflores, Lima 18 – Peru Immeuble FADH, 14th floor Tel: +51 1 242 4597 BP 5695 Dakar – Senegal Fax: +51 1 242 4597 Tel/Fax: +221 33 821 79 39  Asia  East Africa 21st floor, Pet Plan Building Plot 23b Bandali Rise – Bugolobi 444 EDSA, Manila PO Box 36179 – Kampala – Uganda Philippines Tel: +256 414 236 745 November 28th 2008 Evaluating Risks in Microfinance 16

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