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RAISING CAPITAL TO FUND GROWTH

RAISING CAPITAL TO FUND GROWTH. THE EXPERIENCE OF HOFOKAM LTD (UGANDA ) Presentation by Charles Isingoma, General Manager HOFOKAM AMT-Investors’ Fair, Accra 2011. INTRODUCTION. Institutional Background

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RAISING CAPITAL TO FUND GROWTH

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  1. RAISING CAPITAL TO FUND GROWTH THE EXPERIENCE OF HOFOKAM LTD (UGANDA) Presentation by Charles Isingoma, General Manager HOFOKAM AMT-Investors’ Fair, Accra 2011

  2. INTRODUCTION • Institutional Background • HOFOKAM is a Micro Finance Institution founded by the Catholic Dioceses of Hoima, Fort Portal, and Kasese, (all located in Western Uganda) with funding and technical support from Catholic Relief Services (CRS). The Institution was founded in March 2003 through the merger of three Diocesan microfinance (MF) Programs and incorporated as a company limited by guarantee.

  3. Institutional Background (cont’d) • The institution currently serves over 22,000 clients organized in 917 Village Banks covering a geographical area of 16 Districts with a portfolio in excess of US$ 3,378,000 by 30th September 2011.

  4. ASSETS STRUCTURE • As at 30th September 2011

  5. CAPITAL STRUCTURE • As at 30th September 2011

  6. FUNDRAISING PROCESSES & STRATEGY • Establishing contacts with investors through membership bodies like the AMT, AMFIU • Regular information sharing in form of financial and operational performance reports • Consistent reporting through the MIX • Encouraging regular rating and publicisation of results • Undertaking regular financial and social performance audits

  7. CHALLENGES ENCOUNTERED DURING FUNDRAISING • Prolonged period between end of due diligence process and disbursement date affects liquidity management • Varying formats for information presentation required by different stakeholders during appraisal • Hedging the local currency against foreign currency and the actual cost of borrowing and the need for high returns on investment by the investors.

  8. CHALLENGES ENCOUNTERED DURING FUNDRAISING (cont’d) • Most investors want to deal with well established and mature institutions while neglecting the upcoming ones. • Varying conditions among different investors. Investors should benchmark their requirements. • Timely communication of the results of the investment committee. • The duration of the investment is usually short which turn affects long term plans of the MFs.

  9. OVERCOMING THE CHALLENGES • Ensuring availability and transmission of relevant information for purposes of appraisal • Commencing funding applications ahead of time to minimize potential delays • Imploring potential investors to unify the reporting formats and structures possibly by adopting the Fact Sheet • Investors should build capacity of MFIs in order for them to be competitive and sustainable in the long run.

  10. FUTURE PLANS • Ensuring that HOFOKAM remains profitable and sustainable in the medium to long term • Embracing and promoting the consumer protection principles campaign • Attracting more investors to fund the growth projections of the institution • Promoting social performance management

  11. CONCLUSION • We appreciate the cordial relationship that exist between us and our partners plus the excellent wok AMT is doing to link us to the investors. • THANK YOU FOR LISTENING

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