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IFMR Capital concludes largest securitisation deal for the year with Equitas

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Equitas Microfinance India (formerly Singhivi Investment & Finance), one of the country’s leading microfinance companies, recently concluded a large securitisation deal totalling INR 78.95 crores. ‘Zeus IFMR Capital 2012’, a special purpose vehicle created for the transaction has issued two tranches of PTCs, the senior of which was rated A (SO) and the junior BBB (SO) by CRISIL. IFMR Capital was the sole advisor to the deal. The allotted rating validates the seasoning profile and the strong processes of Equitas Microfinance India. The senior PTCs were subscribed to by Kotak Mahindra Bank.

On the conclusion of the deal, Mr. Bhaskar, the COO of Equitas said “The Company constantly looks at various avenues for diversifying its funding sources through new investors and new instrument. The Company had initiated the process of raising funds through the securitization route with the support from IFMR Capital by issuing the first rated securitization transaction in the country’s MFI sector during March 2009 and this is the fourth such transaction”.

Speaking on the transaction, IFMR Capital’s CEO, Dr. Kshama Fernandes said, “This is a reiteration of IFMR Capital’s commitment to provide access to capital markets for high quality originators and our continued faith in the sector. The tight pricing on the senior tranche in the current markets reflects the continued quality of the asset class and the strong credit of SIFPL.”

The transaction of the securitisation on behalf of Kotak Mahindra Bank was done by their Agri Business Group and the portfolio of micro loans have been lent to women borrowers. This is the first such securitisation transaction done after the new guidelines for securitisation were put in place by the RBI.

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