Dutch development bank FMO has proposed a senior unsecured loan worth $7.5 million for Bangladesh-based social enterprise Sajida Foundation.
Sajida Foundation was set up in 1993 as a non-profit organisation providing microcredit products, healthcare services and social development programmes. Sajida is the seventh-largest microfinance institution in Bangladesh with $199 million in total assets and $34 million in equity by the third quarter of 2019. It has 199 branches serving more than 340,000 customers during the period.
FMO said the five-year loan facility funded by MASSIF will be used to finance Sajida’s microfinance portfolio. MASSIF is an FMO scheme that provides access to financial services such as bank accounts, savings and loan products for micro-, small- and medium-sized entrepreneurs.
“This transaction will fit in the MASSIF strategic investment theme of ‘The Unbanked’ as Sajida is a microfinance institution operating in Bangladesh,” FMO said in the proposal.
This transaction will be the first DFI (development finance institution) loan to Sajida, it added.
“Short-term loans form 50 per cent of Sajida’s borrowing and hence the present proposal of a 5-year loan will be highly additional to them in managing their ALM.”
Sajida was formed through receiving a 51 per cent shareholding of Renata Pharmaceuticals Ltd, formerly Pfizer Bangladesh.
Dhaka Stock Exchange-listed Renata is one of the fourth largest pharmaceutical companies and a leader in animal health products, with market capitalisation of approximately $1.1 billion as of June 31, 2019, Sajida said on its website.
“SAJIDA has grown into a self-sustaining organisation with a majority of its programmes financed by dividend earnings from Renata Limited, service charges from microfinance operations, and fees from its health and insurance ventures.”