SKS Micro completes securitization transaction; stock up

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SKS Micro completes securitization transaction; stock up
SKS Microfinance: Quotes, News
BSE 696.25BSE Quote18.7 (2.69%)
NSE 695.80NSE Quote19.6 (2.82%)
SKS Microfinance Limited today announced the completion of a Rs 54.48 crore securitization transaction. The announcement comes close on the heels of its Rs 200 crore securitization transaction with a leading public sector bank in November 2012.

Shares of the company surged and touched 52-week high. At 10.40 am IST the shares were seen trading at Rs 177, higher by 2.46%. It touched an intra-day high of Rs 178.

SKS Microfinance Limited has downloaded the receivables from 64,579 micro loans extended to rural women entrepreneurs to a Special Purpose Vehicle, and Pass Through Certificates (PTCs) have been purchased by a non-banking entity.

"The present transaction indicates that it is possible to generate interest outside the banking system also for a well-originated microfinance paper," said S. Dilli Raj, Chief Financial Officer, SKS Microfinance Limited. "The pool is well diversified with the top three states contributing 45.38% and the top ten branches about 4.85% of the pool principal. The average loan amount is Rs 11,572."

The pool is rated by one of the leading Rating Agencies, which has awarded the 'Highest Safety Rating'.

"The rating is based on the credit quality of the underlying loans; the transaction structure and defined payment mechanism; support in the form of credit cum liquidity enhancement facility; the sound legal structure of the transaction and the track record and good performance of SKS." according to a statement issued by the Rating Agency.

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