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SANABEL's sixth annual conference

SANABEL's sixth annual conference. Beirut – May 2009. 2008 MIX Global 100 Composite Rankings. Charles Cordier. Lead analyst –Africa and MENA. MIX ( Microfinance Information Exchange). Background. Why a Composite Ranking? Rankings on single results are too simplistic

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SANABEL's sixth annual conference

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  1. SANABEL's sixth annual conference Beirut – May 2009 2008 MIX Global 100 Composite Rankings Charles Cordier Lead analyst –Africa and MENA MIX ( Microfinance Information Exchange)

  2. Background • Why a Composite Ranking? • Rankings on single results are too simplistic • Performance has many aspects to it • Composite creates a picture of well rounded MFI, balanced scorecard • What performance does it attempt to measure? • Build long term profitability • Increase access to financial services • Minimize costs of those services • Disclose results

  3. How does it work • Sample • FY07 results published in MIX Market • 971 MFIs, 651 included in ranking • Process • Remove MFIs with missing data • Exclude MFIs that do not meet minimum profitability requirements • Rank MFIs by 11 individual variables • Average ranks by performance area or “pillar” (i.e. outreach) • Average performance area rankings for overall ranking • Methodology: Percentile ranking Efficiency Outreach Transparency Profitability

  4. Methodology Full sample (971 MFIs) Screened for profitability (651 MFIs) • Ranked on 11 variables under three pillars: • Outreach (1) • Efficiency (2) • Transparency (3)

  5. Distribution by Charter NGOs dominate top 25 to top 500 rankings Banks represented a small group in the overall ranking; yet, half their sample claimed spots in the top 100 8 in 10 MFIs from top 10 are « for profits » ones.

  6. Distribution by Region Latin America ranked most MFIs, 28 in top 100. 7 MFIs from Colombia and 6 from Ecuador. Asia gets 9 MFIs in top 10 thanks to their size (borrowers), growth in borrower and efficiency. 14 Arab region MFIs are included in top 100, with higher regional representation in top 100 than any other region, given the small number of MFIs from the region.

  7. MENA Ranking TOP 100 • 26 Arab MFIs in the Top 500 ranking • 5 goes down and 7 goes up from 2006 and 2007

  8. Distribution: Percentile Rankings Top 100 MFIs still improving efficiency, averaging 56th percentile, with majority below 60%. Outreach averaging 73rd percentile, only a few below 60th percentile.

  9. Observations and Feedback • Rankings capture important industry developments • Change in rankings reflected gains in efficiency • Ranking changes reflected “real” changes in MFI performance • Market Feedback • Single most commented MIX piece, incl. drawing MFI attention to their own data • Confusion of prior year ranking “changes” • Outreach is underweighted • No data on social performance disclosure

  10. 2009 Improvements • Improve methodology • Seek guidance from an Advisory Panel • Review and revise methodology, as necessary, which may include disclosures on Social Performance

  11. MICROFINANCE INFORMATION EXCHANGE, INC. The leading provider of business information and data services for the microfinance industry. Web: www.themix.org Email: info@themix.org Africa Office: BP 23035 Dakar, Senegal Other Locations Washington, D.C. ● Lima, Peru ● Guragon, India ● Jakarta, Indonesia

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