MEXICO CITY – Shares of small Mexican bank Compartamos, which specializes in lending to mom-and-pop businesses, surged as much as 34 percent in their
$407 million stock market debut Friday.
Owners of Banco Compartamos, which means ”let's share” in Spanish, sold about 30 percent of the bank, spokeswoman Luisa del Castillo told Reuters.
More than 80 percent of the offer was placed in New York, with the rest on Mexico's stock exchange, according to a company release.
Mexican shares of Compartamos jumped as high as 53.53 pesos after the company priced the offer at 40 pesos per share. In afternoon trading the stock
eased back slightly to 52 pesos.
Compartamos said it sold 111,572,532 shares, with an over allotment provision of 16,735,880 shares. It was unclear whether banks managing the offer
exercised the over allotment, worth about $61 million.
Compartamos, with profits of around $57 million last year, has just over 600,000 clients in rural and semi-urban regions of Mexico.
“We have clients who work in food, clothing, shoes and crafts,” Castillo said. “They're people with anything from a super-small business up to a
corner store.”
Despite lending to customers with little credit history or collateral, Compartamos has kept past-due loans below 1 percent of its portfolio.
“The offer received a lot of demand from institutional and retail investors,” said one banker associated with the offer. ”This is a one-of-a-kind
story in the market today, which is why there is so much interest.”
Last year, Bangladeshi economics professor Muhammad Yunus received the Nobel Peace Prize for pioneering microlending as a way to create
self-employment and escape poverty.
The World Bank's International Finance Corporation, which backs private companies with an eye toward eliminating poverty in developing markets, is the
third-largest shareholder in Compartamos.
Mexico's government gave Compartamos a banking license last year, prior to which it had operated as a specialized lending firm.
Mexico's mostly foreign big banks, led by Citigroup and BBVA, focus on a small but growing middle class, although they are beginning to design
consumer products for lower-income clients.
The big banks' branches are absent from many rural areas in Mexico, where one in two people live on less than $5 a day.
I hope the "Mom and Pop' operations can continue considering the arrival of Walmart, Cosco, Dollar stores, etc.Bob and Susan - 4-29-2007 at 04:53 PM
does "bancoduo" have a child named "bacquito" ???bajalou - 4-29-2007 at 06:10 PM
Quote:
Originally posted by bacquito
I hope the "Mom and Pop' operations can continue considering the arrival of Walmart, Cosco, Dollar stores, etc.
A lot of mom and pop's serve a very local population. They would have access to many items they sell at a much better price than they are paying now.
You can find Kirkland brand products in most of the markets here in San Felipe. In Mexicali Costco, a large percentage of the shoppers are buying
flats of products, certainly not for home use, but for their businesses.DENNIS - 4-29-2007 at 06:36 PM
Bajalou ----
Funny you should mention that. The only Kirkland product I've seen at the Ensenada Costco is coffee. They're are probably more, I just don't recall
seeing them. At the Costco in Chula Vista, Kirkland is in every aisle.
WalMart Ensenada doesn't seem to have the Equate brand either. That's the in-house generic which saves the shopper lots of money.
Micro-Lending
CaboRon - 6-2-2007 at 08:40 AM
A form of this micro-lending had been very succesful in India. Some of
these loans are less than one hundred dollars, but they might finance the purchase of a loom or other supplies so that these people can bootstrap out
of abject poverty. These kinds of programs plant the seeds of growth and actually provide a modest profit to the lenders. Bringing others up
raises everyones level. Ron
