managing risk.pdf

Managing Risk and Creating Value with Microfinance121Profit, MFI, 43housing microfinancing, 74ProFund, 21bProperty insurance, 53RRaw materials and components for microbusinessesdisruption after natural disaster, 91sources of risk, 7Red Transaccional Cooperativa, 105–06References, 8Regulationhousing microfinance, 70insurance consumer protection, 59interest rate ceilings, 46, 47tMFI governance structure and, 20, 22microleasing, 81, 82, 84microlending restrictions, 10new technologies, 110–11, 110bproperty title and rights, 68prudential, 48to reduce interest rates, 47–48risk management role, 10weather-indexed insurance, 58–59Reinsurance, 57, 58, 59Repossession of leased equipment, 80–81, 82Reserves, MFIBasel II requirements, 10contingency funds, 92, 93–94, 94bgood risk management, 4–5, 7Risk assessmentelements, 10external ratings services, 12goals, 11portfolio composition, 11–12responsibility, 10risk-pricing methodologies, 42–43tools, 12, 13bRisk management, generallyBasel II standards, 10categories and types of risk, 3–9, 4trisk assessment, 10significance of, 3, 14steps, 11–12strategies, 13–14system design and development, 10type of MFI and, 5Risk management and investment committee, 28Risk pooling, 53Rockefeller, John, 87Rural lendingbusiness service provider alliances, 14risk management strategies, 13–14sources of risk, 7, 8–9, 8tweather-indexed insurance, 56–57, 58–59SSaint-Exupery, Antoine de, 77Savings and Agricultural Credit Cooperative Society(Madagascar), 80Segmented risk evaluation, 42–43Shorebank Advisory Services, 12, 12tSize of loan, sources of risk, 6Social performance management, 24bSouth Africa, 105Specialized MFIs, Basel standards, 10Starbucks, 8–9State-owned and state-funded institutionsinstitution governance and, 21political risk, 5, 21strategies to reduce interest rates, 45–46types of, 21Strategic planning, 23Strategic risks, 5Strikes, 7–8Subsector analysis, 9Sun Tzu, 17Supervision and management of daily operationsboard of directors’ role, 24, 25–26, 29management information system, 30performance evaluation, 29risk management role, 10training and professional development, 30TTaxation, microleasing, 81, 83, 84Technologyadoption and implementation, 109, 111associated risks, 110biometric, 108–09branchless banking, 110bclient resistance, 105cost considerations, 109–10mobile banking, 104–05, 106network systems, 105–06penetration of services and, 104fpersonal digital assistants, 106–07