Cablegate: Colombia: Reponse to Opic On Microfinance Growth Fund

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DE RUEHBO #3188/01 2811322
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R 081321Z OCT 09
FM AMEMBASSY BOGOTA
TO RUEHC/SECSTATE WASHDC 0258
INFO RUEHBR/AMEMBASSY BRASILIA 0069
RUEHBU/AMEMBASSY BUENOS AIRES 0043
RUEHCV/AMEMBASSY CARACAS 0097
RUEHLP/AMEMBASSY LA PAZ OCT MEXICO 0038
RUEHMU/AMEMBASSY MANAGUA 0030
RUEHPE/AMEMBASSY LIMA 0104
RUEHQT/AMEMBASSY QUITO
RUEHSG/AMEMBASSY SANTIAGO

UNCLAS BOGOTA 003188

SENSITIVE
SIPDIS
SIPDIS
PASS TO RICHARD GREENBERG, OPIC

E.O. 12958: N/A
TAGS: ECON EINT EFIN OPIC CO EINV
SUBJECT: COLOMBIA: REPONSE TO OPIC ON MICROFINANCE GROWTH FUND

REF: 09 STATE 096859

1. (SBU) Summary: Embassy contacts at Colombia's National
Association of Financial Institutions (ANIF) described the Women's
World Banking (WWB) microfinance institutions (MFIs) in
Bucaramanga, Cali, and Popayan as outstanding lending institutions
with a solid reputation in Colombia. Forbes Magazine ranked the
three institutions in the top 10 in its "Top 50 Microfinance
Institutions" publication. Per reftel request, the Embassy has no
information linking the three MFIs to terrorism, money laundering,
or corruption. End Summary.

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Background on WWB Bucaramanga, Cali, and Popayan

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2. (U) WWB Bucaramanga, also known as Fundacion Mundo Mujer (FMM),
was established in 1986. It has over 155,000 clients, 73% of them
women. With a portfolio of over $135 million, WWB Bucaramanga
provides basic loans, individual loans for working capital,
seasonal loans and very short term loans to meet demand during
special holidays. Its clients are primarily low income families.
In December 2007, Forbes magazine ranked WWB Bucaramanga as the
fourth best microfinance institution in its publication, "Top 50
Microfinance Institutions." WWB Bucaramanga has 35 branches in
nine departments.

3. (U) WWB Cali began operations in 1980 and joined the Women's
World Banking network in 1982. The microfinance institution has 59
branches in 12 states serving over 220,000 clients, 68% of them
women. WWB Cali has a portfolio of more than $240 million and
provides basic individual loans for working capital purposes, short
term seasonal loans to meet the demands of special holidays,
housing loans, educational loans, and motorcycle loans. Forbes
ranked WWB Cali as the tenth best microfinance institution in the
world. The World Bank and the Inter-American Development Bank
(IDB) also highlighted WWB Cali's performance in both transparency
and portfolio management. Duff and Phelps, a financial advisory
and investment banking services company, awarded a rating of AA+ to
WWB Cali in 2008.

4. (U) WWB Popayan, also known as Fundacion Mundo Mujer (FMM), was
established in 1985 as a branch of Women's World Banking (WWB) in
Cali. In 1989, WWB Popayan became an independent microfinance
institution. The institution has over 223,000 clients, 71% of them
women. With a portfolio of over $142 million, WWB Popayan and its
30 branches throughout Colombia provide a variety of products,
including business loans, seasonal loans, preferential loans, rural
loans, secured loans, housing loans, educational loans and car
loans. Forbes ranked WWB Popayan as the ninth best microfinance
institution in the world. FMM Popayan also won the 2008
Inter-American Development Bank Award for Excellence in
Microfinance (Non-Regulated Institutions) for the second time (in
eight years) and is the only microfinance institution to receive
this recognition twice. The IDB praised FMM's economic and social
contribution and impact. FMM Popayan has the lowest average
outstanding balance of any major Colombian microfinance
institution, and it is exceptionally well capitalized, with more
than $45 million in equity.

5. (SBU) Among the three listed MFIs, the Embassy through its
USAID office has provided technical assistance to WWB Popayan in
the design and implementation of a microfinance program. According

to USAID, among the 30 financial institutions that received USAID
technical assistance, WWB Popayan is one of the best institutions
in terms of adopting new methodologies, improving accounting and
reporting standards, increasing financial coverage of targeted
populations, and adapting to change.

6. (SBU) WWB's Bucaramanga, Cali, and Popayan are well known in
Colombia and in international microfinance circles. Colombia's
National Association of Financial Institutions (ANIF) gave high
marks to all three MFIs. The Embassy found no derogatory
information linking WWB Bucaramanga, Cali, and Popayan to
terrorism, money laundering, or corruption.

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Prospective MFI Candidate

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7. (U) Embassy also recommends potential funding for Pro Mujer.
Although not located in Colombia, Pro Mujer is looking to enter
Colombia to provide additional microcredit access as well as
business training, healthcare and health education to poor women
entrepreneurs. Founded in 1990, Pro Mujer is an international
women's development and microfinance organization that alleviates
poverty in Latin America with current operations in Argentina,
Bolivia, Mexico, Nicaragua, and Peru.
BROWNFIELD

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