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SKS Microfinance completes Rs 55 crore securitization

31 Dec 2013 Evaluate

SKS Microfinance has completed its fourth microfinance securitization during the current financial year of Rs 55 crore. The first three substantial securitizations were: Rs 321 crore (announced by the company on September 30), Rs 80.81 crore (on December 11) and Rs 215 crore (on December 19). The pool is rated A1 + (SO) by a leading rating agency signifying ‘a very strong degree of safety regarding timely servicing of financial obligation’. Such instruments carry the lowest credit risk.

The company has downloaded the receivables from micro loans extended to more than 72,000 rural women entrepreneurs to a Special Purpose Vehicle, and Pass Through Certificates (PTCs) have been purchased by a private sector bank. The entire pool qualifies for weaker section treatment as per the RBI’s priority sector lending guidelines.

The pool is structured with geographical diversity as it comprises receivables from 13 non-Andhra Pradesh states, and has been subjected to a seasoning of three months.

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