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20 Sep 2022 07:00
ASA International Group plc August 2022 business update
Amsterdam, The Netherlands, 20 September 2022 - ASA International, ('ASA International', the 'Company' or the 'Group'), one of the world's largest international microfinance institutions, today provides the following update on its business operations as at 31 August 2022.
· Liquidity remains high with approximately USD 106 million of unrestricted cash and cash equivalents across the Group.
· The pipeline of funding deals under negotiation totalled approximately USD 197 million.
· With the exception of India, Sri Lanka, and Myanmar, all other operating subsidiaries continued to achieve collection efficiency of more than 90% with 9 countries achieving more than 95%.
· India collections slightly improved from 83% in May to 84% in August, despite the substantial overdue collections. Collection efficiency, including regular and overdue collections as well as advance payments, was at 101% as a percentage of the regular, realisable collections, including advance payments.
· PAR>30 for the Group, including off-book loans and excluding loans overdue more than 365 days, increased from 6.0% in May to 6.5% in August, primarily due to the end of moratoriums in India as of June.
· The PAR>30 for the Group's operating subsidiaries, excluding India and Myanmar, remained broadly stable at 1.9% in August.
· Excluding all loans which have been overdue for more than 180 days and, as a result, have been fully provided for, PAR>30 remained stable at 4.2% in August.
· Disbursements as percentage of collections exceeded 100% in 8 countries. The decreasing percentage in India was due to the ongoing strategic decision to reduce disbursements while elections in Kenya, and currency redenomination in Sierra Leone led to the country operations curtailing disbursements as a precaution.
· With the number of clients broadly stable at 2.4 million, the continuing strategic focus in India on primarily collections, and the impact of currency depreciation in major markets, the Gross OLP decreased to USD 370 million (10% lower than in May 2022 and 16% lower than in August 2021).
· The moratorium amount decreased from USD 18 million in May to USD 0.02 million in August. Whereas moratoriums in May and June were composed of the restructured loans of certain distressed clients in India as per the RBI guidelines, moratoriums in July were provided only to clients in Sri Lanka and those in August were only to clients in Sierra Leone.
Funding
· Unrestricted cash and cash equivalents remained high at approximately USD 106 million.
· The Company secured approximately USD 40 million of new loans from local and international lenders between June and August 2022.
· The majority of the Company's USD 197 million pipeline of future wholesale loans are supported by agreed term sheets and/or draft loan documentation. The terms and conditions of the remaining loans are being negotiated with lenders.
Collection efficiency until 31 August 2022(1)
Countries | Mar/22 | Apr/22 | May/22 | Jun/22 | Jul/22 | Aug/22 |
|
India | 81% | 83% | 83% | 85% | 86% | 84% |
|
Pakistan | 100% | 100% | 100% | 100% | 100% | 99% |
|
Sri Lanka | 94% | 93% | 92% | 89% | 89% | 88% |
|
The Philippines | 99% | 99% | 99% | 100% | 100% | 100% |
|
Myanmar | 72%(2) | 72%(2) | 73%(2) | 78%(2) | 80%(2) | 84%(2) |
|
Ghana | 100% | 100% | 100% | 100% | 100% | 100% |
|
Nigeria | 96% | 95% | 95% | 96% | 96% | 96% |
|
Sierra Leone | 94% | 94% | 96% | 96% | 96% | 94% |
|
Tanzania | 100% | 100% | 100% | 100% | 100% | 100% |
|
Kenya | 100% | 100% | 100% | 100% | 100% | 100% |
|
Uganda | 100% | 100% | 100% | 100% | 100% | 100% |
|
Rwanda | 97% | 97% | 97% | 97% | 97% | 97% |
|
Zambia | 98% | 98% | 98% | 98% | 98% | 98% |
|
(1) Collection efficiency refers to actual collections from clients divided by realizable collections for the period. It is calculated as follows: the sum of actual regular collections, actual overdue collections and actual advance payments divided by the sum of realizable regular collections, actual overdue collections and actual advance payments. Under this definition collection efficiency cannot exceed 100%. (2) Collections are impacted by the ongoing lockdowns and civil unrest in some areas of our operations. | |||||||
· Collection efficiency across the Group increased or remained broadly stable compared to the previous month in all countries.
· Collections in India slightly improved since May to 84% in August, despite the substantial overdue collections.
· Collection efficiency in India, including regular and overdue collections as well as advance payments, was at 101% as a percentage of the regular, realisable collections, including advance payments. The substantial difference is due to the Group's policy that any loan instalment paid is first credited against the oldest outstanding amount overdue. This has an adverse impact on India's monthly collection efficiency, which is further aggravated by the relatively long duration of the loans disbursed in India. This adjusted collection efficiency metric illustrates that most clients in India continue to make payments on their loans due.
Loan portfolio quality up to and including August 2022(3, 4, 5)
Gross OLP (in USDm) |
| Non-overdue loans |
| PAR>30 less PAR>180 | ||||||||||||||||||||||
| Jun/22 | Jul/22 | Aug/22 |
| Jun/22 | Jul/22 | Aug/22 |
| Jun/22 | Jul/22 | Aug/22 | |||||||||||||||
India (total) | 80 | 73 | 66 |
| 75.1% | 65.9% | 62.5% |
| 8.1% | 13.8% | 16.1% | |||||||||||||||
Pakistan | 80 | 71 | 77 |
| 99.7% | 99.7% | 98.6% |
| 0.1% | 0.2% | 0.2% | |||||||||||||||
Sri Lanka | 4 | 4 | 4 |
| 77.5% | 74.2% | 76.8% |
| 6.0% | 9.0% | 8.9% | |||||||||||||||
Philippines | 47 | 47 | 47 |
| 97.1% | 96.9% | 97.1% |
| 1.0% | 0.7% | 0.5% | |||||||||||||||
Myanmar | 20 | 19 | 17 |
| 62.5% | 68.0% | 68.6% |
| 31.2% | 21.1% | 12.5% | |||||||||||||||
Ghana | 43 | 40 | 34 |
| 99.6% | 99.6% | 99.5% |
| 0.2% | 0.1% | 0.1% | |||||||||||||||
Nigeria | 41 | 41 | 41 |
| 92.0% | 91.3% | 91.0% |
| 3.7% | 3.8% | 3.6% | |||||||||||||||
Sierra Leone | 6 | 6 | 5 |
| 88.6% | 87.1% | 84.4% |
| 4.6% | 4.2% | 4.3% | |||||||||||||||
Tanzania | 42 | 43 | 44 |
| 99.5% | 99.5% | 99.4% |
| 0.2% | 0.2% | 0.2% | |||||||||||||||
Kenya | 19 | 20 | 19 |
| 99.0% | 99.0% | 98.9% |
| 0.4% | 0.4% | 0.4% | |||||||||||||||
Uganda | 10 | 10 | 10 |
| 98.4% | 98.6% | 98.6% |
| 0.1% | 0.2% | 0.2% | |||||||||||||||
Rwanda | 4 | 4 | 4 |
| 78.2% | 93.8% | 94.1% |
| 2.8% | 2.8% | 2.5% | |||||||||||||||
Zambia | 3 | 3 | 3 |
| 95.8% | 95.8% | 95.2% |
| 2.6% | 2.7% | 2.6% | |||||||||||||||
Group | 399 | 379 | 370 |
| 91.1% | 89.7% | 89.5% |
| 3.9% | 4.5% | 4.2% | |||||||||||||||
PAR>30 |
| PAR>90 |
| PAR>180 |
| |||||||||||||||||||||
| Jun/22 | Jul/22 | Aug/22 |
| Jun/22 | Jul/22 | Aug/22 |
| Jun/22 | Jul/22 | Aug/22 |
| ||||||||||||||
India (total) | 13.3% | 18.5% | 20.5% |
| 6.9% | 8.7% | 6.0% |
| 5.1% | 4.7% | 4.4% |
| ||||||||||||||
Pakistan | 0.2% | 0.2% | 0.2% |
| 0.1% | 0.1% | 0.1% |
| 0.0% | 0.0% | 0.0% |
| ||||||||||||||
Sri Lanka | 8.8% | 12.0% | 12.1% |
| 5.3% | 6.1% | 6.3% |
| 2.7% | 3.0% | 3.2% |
| ||||||||||||||
Philippines | 2.7% | 2.6% | 2.2% |
| 2.5% | 2.4% | 2.1% |
| 1.7% | 1.8% | 1.7% |
| ||||||||||||||
Myanmar | 31.5% | 31.5% | 30.8% |
| 26.9% | 28.9% | 29.4% |
| 0.4% | 10.4% | 18.3% |
| ||||||||||||||
Ghana | 0.3% | 0.3% | 0.3% |
| 0.2% | 0.2% | 0.2% |
| 0.1% | 0.2% | 0.2% |
| ||||||||||||||
Nigeria | 6.0% | 6.2% | 6.3% |
| 4.3% | 4.6% | 4.7% |
| 2.3% | 2.5% | 2.7% |
| ||||||||||||||
Sierra Leone | 10.1% | 10.9% | 9.9% |
| 8.8% | 9.5% | 7.8% |
| 5.5% | 6.6% | 5.6% |
| ||||||||||||||
Tanzania | 0.4% | 0.4% | 0.4% |
| 0.3% | 0.2% | 0.2% |
| 0.2% | 0.1% | 0.1% |
| ||||||||||||||
Kenya | 0.8% | 0.8% | 0.9% |
| 0.7% | 0.7% | 0.7% |
| 0.5% | 0.5% | 0.5% |
| ||||||||||||||
Uganda | 1.5% | 1.2% | 0.8% |
| 1.4% | 1.1% | 0.7% |
| 1.4% | 1.0% | 0.6% |
| ||||||||||||||
Rwanda | 4.6% | 4.7% | 4.6% |
| 3.3% | 3.3% | 3.3% |
| 1.8% | 1.9% | 2.0% |
| ||||||||||||||
Zambia | 2.9% | 3.2% | 3.4% |
| 1.4% | 2.1% | 2.4% |
| 0.3% | 0.5% | 0.8% |
| ||||||||||||||
Group | 5.6% | 6.7% | 6.5% |
| 3.8% | 4.3% | 3.5% |
| 1.7% | 2.2% | 2.3% |
| ||||||||||||||
(3) Gross OLP includes the off-book BC and DA model, excluding interest receivable and before deducting ECL provisions and modification loss. (4) PAR>x is the percentage of outstanding customer loans with at least one instalment payment overdue x days, excluding loans more than 365 days overdue, to Gross OLP including off-book loans. Loans overdue more than 365 days now comprise 2% of the Gross OLP. (5) The table "PAR>30 less PAR>180" shows the percentage of outstanding client loans with a PAR greater than 30 days, less those loans which have been fully provided for. |
| |||||||||||||||||||||||||
· PAR>30 for the Group increased from 6.0% in May to 6.5% in August as portfolio quality in India decreased due to the end of moratoriums in June, while currency devaluations substantially reduced the size of OLP from countries with high portfolio quality such as Ghana and Pakistan.
· Credit exposure of the India off-book BC portfolio of USD 25.8m is capped at 5%. The included off-book DA portfolio of USD 1.1 million has no credit exposure.
Disbursements vs collections of loans until 31 August 2022(6)
Countries | Mar/22 | Apr/22 | May/22 | Jun/22 | Jul/22 | Aug/22 |
|
India | 62% | 52% | 72% | 42% | 22% | 25% |
|
Pakistan | 100% | 117% | 118% | 119% | 113% | 112% |
|
Sri Lanka | 122% | 55% | 42% | 61% | 11% | 93% |
|
The Philippines | 104% | 112% | 105% | 104% | 104% | 104% |
|
Myanmar | 116% | 77% | 106% | 85% | 84% | 95% |
|
Ghana | 115% | 118% | 112% | 110% | 91% | 100% |
|
Nigeria | 98% | 110% | 120% | 117% | 100% | 104% |
|
Sierra Leone | 113% | 105% | 93% | 99% | 84% | 81% |
|
Tanzania | 110% | 130% | 120% | 109% | 106% | 111% |
|
Kenya | 113% | 125% | 112% | 92% | 105% | 87% |
|
Uganda | 118% | 122% | 112% | 97% | 97% | 100% |
|
Rwanda | 107% | 112% | 129% | 119% | 113% | 116% |
|
Zambia | 109% | 116% | 125% | 133% | 109% | 110% |
|
(6) Disbursements vs collections refers to actual loan disbursements made to clients divided by total amounts collected from clients in the period.
| |||||||
· Disbursements as percentage of collections exceeded 100% in 8 countries. The decreasing percentage in India was due to the ongoing strategic decision to reduce disbursements while elections in Kenya, and currency redenomination in Sierra Leone led to the country operations curtailing disbursements as a precaution.
Development of Clients and Outstanding Loan Portfolio until 31 August 2022
Clients (in thousands) | Delta | Gross OLP (in USDm) | Delta | ||||||||
Countries | Aug/21 | Jul/22 | Aug/22 | Aug/21-Aug/22 | July/22-Aug/22 | Aug/21 | Jul/22 | Aug/22 | Aug/21-Aug/22 USD | Aug/21-Aug/22 CC(7) | July/22-Aug/22 USD |
India | 675 | 435 | 417 | -38% | -4% | 139 | 73 | 66 | -53% | -49% | -10% |
Pakistan | 486 | 583 | 590 | 21% | 1% | 74 | 71 | 77 | 4% | 38% | 10% |
Sri Lanka | 53 | 46 | 45 | -15% | -2% | 8 | 4 | 4 | -56% | -21% | -2% |
The Philippines | 341 | 317 | 321 | -6% | 1% | 55 | 47 | 47 | -14% | -2% | 0% |
Myanmar | 118 | 103 | 104 | -12% | 1% | 23 | 19 | 17 | -26% | -5% | -12% |
Ghana | 151 | 168 | 170 | 13% | 1% | 44 | 40 | 34 | -23% | 27% | -15% |
Nigeria | 259 | 240 | 242 | -7% | 1% | 34 | 41 | 41 | 21% | 24% | -1% |
Sierra Leone | 42 | 38 | 37 | -12% | -4% | 7 | 6 | 5 | -22% | 7% | -11% |
Tanzania | 155 | 202 | 204 | 31% | 1% | 28 | 43 | 44 | 57% | 58% | 3% |
Kenya | 118 | 136 | 134 | 14% | -1% | 18 | 20 | 19 | 4% | 14% | -5% |
Uganda | 83 | 105 | 105 | 27% | 0% | 8 | 10 | 10 | 26% | 36% | 2% |
Rwanda | 17 | 19 | 20 | 15% | 3% | 3 | 4 | 4 | 40% | 45% | 3% |
Zambia | 11 | 19 | 20 | 85% | 5% | 1 | 3 | 3 | 126% | 126% | 6% |
Total | 2,509 | 2,411 | 2,409 | -4% | -0.1% | 441 | 379 | 370 | -16% | 0% | -2.3% |
(7) Constant currency ('CC') implies conversion of local currency results to USD with the exchange rate from the beginning of the period.
· With the number of clients broadly stable at 2.4 million, the continuing strategic focus in India on primarily collections, and the impact of currency depreciation in major markets, the Gross OLP decreased to USD 370 million (10% lower than in May 2022 and 16% lower than in August 2021).
Selected moratoriums(8) on loan repayments until 31 August 2022
Clients under moratorium (in thousands) |
| |||
Countries | Jun/22 | Jul/22 | Aug/22 | As % of Total Clients |
India | 95 | 0 | 0 | 0% |
Sri Lanka | 0 | 0.6 | 0 | 0% |
Sierra Leone | 0 | 0 | 1.2 | 3% |
Group | 95 | 0.6 | 1.2 | 0.1% |
Moratorium amounts (USD thousands) |
| ||||
Countries | Jun/22 | Jul/22 | Aug/22 | August Moratoriums as % of OLP | As % of Total Moratoriums |
India | 16,044 | 0 | 0 | 0% | 0% |
Sri Lanka | 0 | 3 | 0 | 0% | 0% |
Sierra Leone | 0 | 0 | 0.02 | 0.0% | 100% |
Group | 16,044 | 3 | 0.02 | 0% | 100% |
(8) Moratoriums relate to clients who have received an extension for the payment of one or more loan instalments during the month.
· Moratoriums on loan repayments relate to approximately 3% of clients in Sierra Leone in August. The moratoriums in May and June are composed of the restructured loans of clients in India who accepted to benefit from the one-time debt restructuring scheme established by the RBI and confirmed in September 2021, which ended in June 2022. See RBI Covid-19 Restructuring Guidelines. Moratoriums in July were provided to clients in Sri Lanka while those in August were only to clients in Sierra Leone.
· The moratorium amount across the Group decreased to USD 0.02 million, which represents 0.004% of the Group's Gross OLP.
Key events in September 2022
· Other than the existing partial curfews in Myanmar, the Company is not aware of any further restrictions implemented in its operating countries up until 19 September 2022.
· Record flooding occurred in Pakistan submerging large parts of the country and displacing millions of people. The Punjab region where ASA Pakistan has most of its operations, was not badly affected, while the Sind region saw significant flooding which affected some of ASA Pakistan's clients and operations. The local team has halted operations in areas that were badly affected, while maintaining contact with clients to provide assistance until clients can recover and return to their regular livelihoods.
Enquiries:
ASA International Group plc
Investor Relations +31 6 2030 0139
Véronique Schyns vschyns@asa-international.com
About ASA International Group plc
ASA International Group plc (ASAI: LN) is one of the world's largest international microfinance institutions, with a strong commitment to financial inclusion and socioeconomic progress. The company provides small, socially responsible loans to low-income, financially underserved entrepreneurs, predominantly women, across South Asia, South East Asia, West and East Africa.
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