October 2012

THE GLOBAL MICROFINANCE RATING AGENCY International Seminar on Microfinance in LAC and China

Planet Rating
44 rue de Prony 75017 Paris Tl : 33 1 49 21 26 30 Fax : 33 1 49 21 26 27 contact@planetrating.com - www.planetrating.com

Planet Ratings role is to support the development of a sound microfinance sector, in order to bring a positive social change
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Helping MFIs improve their sustainability by a thorough identification of their strengths and weaknesses Rating missions include an extensive debriefing session with the management team, during which the performance of the MFI is benchmarked to best practices

Helping MFIs maintain their focus on their social goals by providing ratings that cover both financial and social performance Planet Rating has been at the forefront of the development of social performance ratings, and will continue striving to develop tools that help MFIs keep their social focus, while building strong financial institutions (client protection certification, etc.)

Contributing to securing the financing flow for microfinance institutions

Planet Rating provides reliable and objective opinions on the risk level and social performance of MFIs to investors interested in supporting the development of inclusive financial systems

Planet Rating - International Seminar on Microfinance in LAC and China

5 offices worldwide for a global coverage More than 700 ratings for 450 MFIs rated in 85 countries

Pari s

Dakar

Manila

Nairobi Lima

Offices Missions

Planet Rating - International Seminar on Microfinance in LAC and China

Our rating services to MFIs are designed to increase transparency and sustainability

provide an opinion on Institutional Ratings Smart GIRAFE Social Performance Ratings the long term sustainability of an MFI

to communicate

with all investors

the capacity of an MFI to achieve its social goals

the performance of an MFI compared to benchmarks and best practices

with social investors

Assessments

internally

Planet Rating is also one of the first certifiers of the Smart Campaign for compliance with Client Protection Principles
Planet Rating Institutional Presentation Planet Rating - - International Seminar on Microfinance in LAC and China 3

Our services to investors make Planet Ratings expertise available to all

Trainings

Learn the specifics of risk appraisal in microfinance. Introduction to social performance concepts and evaluation.

Due diligences

Ad-hoc due diligences upon request, including portfolio audits and social / institutional ratings for investment funds. All you need to know about the microfinance sector in your countries of operation: regulation, financial inclusion, competition and market saturation. Review of the macro-economic, political and social environment. During the 24-month period following their publication, rating reports may be purchased through Planet Ratings subscription service.

Country ratings

Subscription service

Find out more at www.planetrating.com

Planet Rating Institutional Presentation Planet Rating - - International Seminar on Microfinance in LAC and China 4

After more than 10 years of operations, our services are globally recognized by investors and MFIs
Rating of key MFIs for key microfinance investors

Institutional rating provided since 1999 Proven institutional rating methodology

Key investors have chosen Planet Rating to

Smart GIRAFE recognized by CGAP and all industry actors who regularly sign up for GIRAFE trainings
Social performance rating launched in 2008 Already used by 100 MFIs, among which are

conduct ratings: European Commission, EBRD, EIB, Blue Orchard, ResponsAbility, Oikocredit, Africap, etc.
The most prominent investors and funders,

regional and world leaders

representing a total of 3.5 B USD in microfinance investments have subscribed to our reports: Citigroup, ResponsAbility, Incofin, Oikocredit, Blue Orchard, Triple Jump, Cordaid, MicroVest, etc.

Planet Rating - International Seminar on Microfinance in LAC and China

Planet Rating is backed by solid shareholders

One of the World leaders in microfinance development. Parisbased, PlaNet Finance offers a wide range of services (consulting, investment, debt financing, etc.) The group employs more than 1500 people in 60 countries. Provides 4 product lines: credit information and corporate ratings, receivables management, credit/guarantee insurance, export guarantees and factoring. FitchRatings (AA), Moodys (A2). Paris-based with 4,600 employees in 66 countries; 2011 revenues of 1.55 billion EUR Leading French manager of public savings deposits and pension funds. It is also a leading investor in social housing and regional/local development projects throughout France. FitchRatings (AAA). Paris-based with 5600 employees; 2010 assets of 269 billion EUR and net income of 2.1 billion EUR One of the world's top three brokers in financial (money markets, bonds, interest rate, currency/ credit derivatives, equities, equity derivatives, interest rate & index futures) and commodity-related products. Paris-based and Euronext-listed, VIEL operates in 28 countries; 2011 revenues of 900 million EUR Luxembourg for Microfinance and Social Responsibility is a nonprofit association, created by ex-Deloitte partners with the goal to promote transparency and best practices in Microfinance

PlaNet Finance CDC Coface Viel LMSR

5

5%
14

14%
13

54

14% 13%

54%

LMSR

Planet Rating - International Seminar on Microfinance in LAC and China

Key elements of our product range

Planet Rating - - International Seminar on Microfinance in LAC and China Planet Rating Institutional Presentation

Smart GIRAFE Institutional rating methodology

Recent repayment crises in several microfinance markets have proven that clients problems always become the MFIs problems. The Smart GIRAFE rating methodology now includes an assessment of the main social risks faced by MFIs that can have an impact on their sustainability.
Governance Information Risk Management Asset Quality Funding & Liquidity Efficiency & Profitability Client Protection

22%
Alignment of interests
Decision making Strategy and planning Management team HR management

9%

10%
Enterprise risk management

18%
Financial Services Management

14%
Capital adequacy and funding strategy

18%
ROA

9%
Prevention of overindebtedness Responsible pricing Transparency

Information management

Operational efficiency Market position Adaptation of services

Internal controls

Credit risk level

Liquidity risk

Respectful treatment of clients

Privacy of client data Mechanisms for complaint resolution

Social Risk Monitoring Internal audit

Credit risk coverage

Market risks

Responsible financial performance

Planet Rating - - International Seminar on Microfinance in LAC and China Planet Rating Institutional Presentation

A Microfinance Institutional Rating provides an opinion on the long term viability and creditworthiness of an MFI
Grade Performance Excellent Risk Low or well managed Modest or well managed Moderate to medium-high High to very high

Distribution of GIRAFE rating grades 2008-2012

AB++
1st quartile

B+ EKI B

A B C

++ + ++ + ++ + -

Good

2nd quartile

B-

Fair

C++
3rd quartile

C+

D E

Weak

C C4th quartile

D
As of September 2012
Planet Rating - International Seminar on Microfinance in LAC and China 9

Social rating framework

For most MFIs, institutional sustainability is only a means to an end: achieving their social goals. Reinforcing the double bottom line of the microfinance industry, Planet Rating provides Social Performance ratings for MFIs.
Social performance management Financial Inclusion Social Change Client Protection Human resources policy

Performance factors : try to do good

Risk factors : do no harm

25%
Definition of the social mission

25%
Outreach to the underserved

Bonus
Education, Health and basic services Gender equality and Empowerment Democracy and Human rights Job creation Poverty reduction

30%
Prevention of overindebtedness Transparency Responsible Pricing

20%
Equal rights

Institutionalization of the social mission

Adaptation of services

Compensation policy

Fair and respectful treatment of clients

Mechanisms for complaint resolution Privacy of client data Labor conditions

Social performance monitoring

Cost of services

Environmental sustainability

Planet Rating - International Seminar on Microfinance in LAC and China

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A social rating measures the capacity of an MFI to put its social mission into practice and achieve its social goals.

Distribution of social rating grades 2008-2012

4+ 4
1st quartile
EKI

5 - Advanced 4 - Convincing 3 - In Progress 2 - Incipient 1 - Intangible

4th quartile

4-

3+
2nd quartile

3rd quartile

3-

2+ 2

1+

2-

As of September 2012
Planet Rating - International Seminar on Microfinance in LAC and China 11

A rating process that involves in an depth field visit

Planet Rating - International Seminar on Microfinance in LAC and China

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Our reports : 15 pages of analysis and 2 pages of executive summary

Institutional presentation Grade and outlook Compare your level of performance with all the MFIs rated by Planet Rating

Rating highlights

1 page of key performance indicators

Planet Rating - International Seminar on Microfinance in LAC and China

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Register to our online subscription service and get easy access to the latest ratings, on www.planetrating.com

Planet Rating - International Seminar on Microfinance in LAC and China

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Contacts

| Thank you |
Planet Rating HQ 44 rue de Prony 75017 Paris France Emmanuelle Javoy Tel: +33 1 49 21 26 30

Fax: +33 1 49 21 26 27
ejavoy@planetrating.com

Socit par Actions Simplifie 483 538 369 RCS Paris

Planet Rating - International Seminar on Microfinance in LAC and China

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