New Microfinance Fund Gets Austrian Launch
Austria, December, 15 2009 -
Erste Bank Group has launched the first microfinance fund in Austria. The new ESPA VINIS Microfinance fund will give investors the opportunity to encourage prosperity and economic development in emerging markets, while making a profit.
Manager Martin Cech will invest directly in microfinance bonds as well as other microfinance funds seeking an annualized return of 4% to 6%.
Microfinance, going back to Nobel peace laureate Muhammed Yunus, attempts to fight poverty by giving small businesses access to capital which they would not have had under regular market conditions. The average microcredit is about €600 with a debt service ratio of close to 100%.
Erste Sparinvest has lauded the decorrelation and diversification of such an investment.
‘Microfinance is not as significant as equity or bonds yet they can be an important component of any portfolio since they are not correlated with traditional financial products,’ say Erste Sparinvest's chairman Heinz Bednar.
The fund will focus across global emerging markets, particularly South-East Asia, South America and Eastern Europe.
In accordance with Austrian investment fund law, the ESPA VINIS Microfinance fund will only be priced once a month.