W4_20Arab-focused_20Commercial_20Financing__20Meryem_20Meknassi

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					  Serving the Poor:

         “10 Million Clients by 2010”
                      Sanabel Fourth Annual Conference


   Financing micro-credit in Morocco
   as a means to fight poverty and
   promote sustainable
   development

   Meryem Meknassi
   Managing Director
   JAÏDA



Sponsored by:
TABLE OF CONTENTS

                        Sanabel Fourth Annual Conference


• Sectorial overview of micro-credit in Morocco

• About JAÏDA




    Serving the Poor:   “10 Million Clients by 2010”
Morocco is home to more than 50 % of loans outstanding in
the MENA Region and 7 of the 15 largest MFIs.

                        Sanabel Fourth Annual Conference

             Key figures as of December 31, 2006:

• 1.034 Million micro-enterprises
• MAD 3.5 Billion (EUR 318 Million) worth of loans
  outstanding, average annual growth rate since 2003 of
  59%
• 13 MFIs of which 3 account for 90% of all loans
  outstanding in Morocco
• More than 4,100 employed, including 3,740 credit agents
• Profit margin greater than 20%
• Loans at risk less than 0.3% of total outstanding




    Serving the Poor:   “10 Million Clients by 2010”
Micro-credit is expanding fast, thus creating growing
needs in financing resources.

                         Sanabel Fourth Annual Conference

                   Projected key figures by 2011

• Loans outstanding : MAD 25 Billion (EUR 2,27 Billion) , 7
  times the 2006 value
• Average annual growth rate over 2006-2011: 49%
• Financing needs of MFIs over 2007-2010: MAD 72 Billion
  (EUR 6,5 Billon)




     Serving the Poor:   “10 Million Clients by 2010”
TABLE OF CONTENTS

                        Sanabel Fourth Annual Conference


• Sectorial overview of micro-credit in Morocco

• About JAÏDA




    Serving the Poor:   “10 Million Clients by 2010”
JAÏDA is a specialized financial company legally authorized
by Morocco’s Central Bank. JAÏDA’s paid in capital is
MAD 100 Million.

                           Sanabel Fourth Annual Conference

                           JAÏDA’s equity distribution



                                 10%



                          20%
                                                  45%




                                25%


                         CDG      KfW      CDC       AFD




     Serving the Poor:    “10 Million Clients by 2010”
JAÏDA was established in May 2007 as a privately held corporation
with a specific mandate to mobilize financing resources for
Morocco’s MFIs.

                         Sanabel Fourth Annual Conference

                  MISSION
    Fight poverty through facilitating the
   access of Morocco’s micro-enterprises to
                     credit

                    HOW
  Mobilize and make financing resources
  available to MFIs to loan in turn to micro-
                entrepreneurs



     Serving the Poor:   “10 Million Clients by 2010”
JAÏDA’s Strategic Objectives are:


                         Sanabel Fourth Annual Conference

• To facilitate the access of MFIs to financing resources, with
  a focus on small & medium
• To promote cooperation, rather than competition, with the
  banking sector
• To coordinate donor actions
• To foster dialogue with Morocco’s authorities to promote
  the further development of Microfinance in the country
• To support the institutional development of MFIs
• To urge MFIs to develop new products for their clients and
  new ways to finance themselves
• To bridge the gap between the goal of social development
  and this of profitability
     Serving the Poor:   “10 Million Clients by 2010”
JAÏDA has a clear added value as an investment tool in the
micro-credit sector

                         Sanabel Fourth Annual Conference

• One stop shop for MFIs on due diligence, thus minimizing
  transaction costs for investors onto the whole sector
• Loaning in local currency and putting in place appropriate
  hedging mechanisms
• Loans made at commercial rates, and as such, contribute to
  integrating MFIs into the financial sector
• No crowding out of the local commercial financing sources:
  senior loans to small & medium MFIs, subordinated loans to
  bigger MFIs
• Innovative financing means
• Offering the opportunity to make equity investments




     Serving the Poor:   “10 Million Clients by 2010”
In order to qualify for JAÏDA financing, MFIs shall meet the
following general, financial and operational criterias:

                         Sanabel Fourth Annual Conference

General criterias
• Moroccan legal entity with a minimum 2-year record
   operating in the micro-credit sector
• Audited books for the last 2 years
• Microfinance rating less than 2 years old (priority is given
   to MFIs with rate B or above)
Financial criteria
• Debts/equity (after JAÏDA financing) < 7
• ROA ≥ 3% (target ROA > 5%)
• PAR 30 ≤5% (target PAR 30 < 2%)
• ROA > 5%
• PAR 30 < 5%
Operational criteria
• OSS > 100%


     Serving the Poor:   “10 Million Clients by 2010”
To respond to current and future sectorial needs, JAÏDA
aims to finance 8% of loans outstanding in Morocco
by 2011.

                                 Sanabel Fourth Annual Conference
                    Projected loans outstanding over 2006-2011
                              Projected financing by JAÏDA
                                         (EUR’ 000 000)

             3000                                                                    24,0%

             2500                                                                    20,0%

             2000                                                                    16,0%

             1500                                                                    12,0%

             1000                                               7,5%         8,0% 8,0%
                                         6,8%       7,2%
                          5,2%
             500                                                                     4,0%
                      598              870      1 273       1 828       2 280
               0                                                                     0,0%
                      2007         2008         2009        2010         2011

                    Secors portfolio                    Share refianances by JAIDA




    Serving the Poor:         “10 Million Clients by 2010”
JAÏDA needs to raise a total equivalent to EUR 272 Million
for that purpose by 2011.

                             Sanabel Fourth Annual Conference
                        Funds to be raised over 2006-2011
                                    EUR (‘000 000)

            100

             80

             60
                                                                73
             40                                          55
                                              27
                   18             18
             20
                    5
                    5              5
                                   5           5
                                               5         5      5
                    9              9           9         5      5
              0
                  2007            2008       2009       2010   2011
                         Senior debt
                         Subordinated debt (level II)
                         Subordinated debt (level I)
                         Equity




    Serving the Poor:      “10 Million Clients by 2010”
                             Contacts


                     Sanabel Fourth Annual Conference

                       Meryem Meknassi
                        Managing Director
                    meknassi.jaida@cdg.ma

                          Annabel Azim
                       Senior Loan Officer
                      azim.jaida@cdg.ma

                         Richard Crayne
                            Consultant
                     crayne.jaida@cdg.ma



Serving the Poor:    “10 Million Clients by 2010”