SKS Microfinance Ltd has concluded a securitisation transaction worth Rs 321 crore ($50.9 million) with a large unnamed public sector bank, as per a stock market disclosure. This is the biggest securitisation transaction in the MFI space since the beginning of this financial year.
The transaction was rated A1+ (SO), the company said in the filing.
"This fiscal we could complete the first securitisation transaction in Q2 itself as against Q3 in FY13,” said S Dilli Raj, CEO of SKS Microfinance.
He said the latest transaction generates liquidity of Rs 321 crore for SKS Microfinance and enables the company to extend micro loans to 4,75,000 rural women entrepreneurs.
“Notably, 29 per cent of the pool is from loans extended to women entrepreneurs from scheduled castes and scheduled tribes, 17 per cent from minorities, 37 per cent from backward castes and the remaining 17 per cent from women belonging to other castes. The entire pool thus qualifies for weaker section treatment for the bank," he said, referring to priority sector lending norms for banks.
Earlier, the micro-lender concluded two microfinance securitisation transactions aggregating Rs 226 crore to close FY13 with total securitisation worth Rs 1,207 crore spread across a dozen transactions.
SKS Microfinance, the only listed micro-lender, operates across 16 states, including Karnataka, Maharashtra, Odisha, Madhya Pradesh, Bihar, Uttar Pradesh, Rajasthan, Uttaranchal, Haryana, West Bengal, Jharkhand, Chhattisgarh, Kerala, Punjab and Delhi.
The firm reported a net profit for the third quarter ended December 31, 2012 after seven consecutive quarters of losses. It has maintained its profitability since then and remained the second-largest micro-lender by gross loan portfolio and fresh disbursals in the first quarter ended June 30, 2013.
SKS Microfinance scrip closed at Rs 128.7 per share, up 0.90 per cent on the BSE in a weak Mumbai market on Monday.
(Edited by Joby Puthuparampil Johnson)