In its 6th and final fundraising from securitization, Hyderabad-based SKS Microfinance, the only listed MFI, has raised Rs. 214 crore, touching a total of Rs.1,782 crore in FY 2015-16.
SKS Microfinance Ltd said in a filing that it has raised Rs.214 crore through securitization, the sixth such securitization transaction for the company this year, which enables companies raise funds by guaranteeing part of the loan book portfolio with financial institutions. Usually, 10% of the funds raised is wiped from the loan books.
“The entire pool qualifies for priority sector treatment as per the Reserve Bank of India’s guidelines. The pool has been rated AA (SO) by a leading rating agency, signifying a ‘high degree of safety regarding timely servicing of financial obligations’. Such instruments carry a very low credit risk,” said SKS in a statement, which has raised Rs.216 crore earlier.
SKS Microfinance Limited’s Gross Loan Portfolio grew by 13% QoQ to Rs. 6,177 crore in Q3-FY16, marginal cost of borrowing reduces to 10%. The Company’s marginal cost of borrowing reduced to 10% in Q3-FY16 from 11.2% in Q2-FY16 while its weighted average cost of borrowing (historical) stood at 11.5% in Q3-FY16, down from 12.1% in Q2-FY16.
Loan disbursements increased by 93% on a year-on-year basis to Rs. 2,980 crore in Q3-FY16 (Rs.1,544 crore in Q3-FY15). During the quarter, SKS Microfinance Limited said it had incremental drawdowns of Rs. 1,478 crore (Rs. 931 crore in Q3-FY15) including securitization transactions of Rs. 616 crore rated as ‘AA (SO)’ and Commercial Paper of Rs. 100 crore rated as ‘A1+’ by a rating agency. The Company also originated Rs. 260 crore worth of loans under managed portfolio in Q3-FY16.
The Company claimed that it has reduced the interest rate charged to borrowers from 20.75% to 19.75% on income-generating loans extended on or after December 7, 2015, charging the lowest rate among private MFIs in the world. There has been an aggregate interest rate reduction of 4.8% since October 2014.
SKS has also availed Rs.100 crore refinance from MUDRA at 10% per annum. As of December 31, 2015, SKS Microfinance Limited had a net worth of Rs. 1,292 crore and a capital adequacy of 23.9%. Cash and cash equivalents stood at Rs. 886 crore.