China Rapid Finance Bolsters Governance by Adding Joe Zhang to Board

Acclaimed author and finance expert to serve as an independent non-executive director

SHANGHAI- China Rapid Finance Limited (“CRF” or the “Company”), a leading online consumer lending marketplace, bolstered its commitment to corporate governance, regulatory compliance and transparency with the addition of acclaimed author and financial expert Huaqiao (Joe) Zhang to its board.

“I have strong belief that with its innovative technology and multi data, multi channel strategy, as well as its rigorous risk management practices, China Rapid Finance has unparalleled advantage to thrive in this huge, untapped market.”

Mr. Zhang, 52, who is currently the chairman of Hong Kong-listed China Smartpay, has been appointed as an independent non-executive director on CRF’s board. Previously, he had served as an advisor to the Company since August 2013.

“The addition of Joe Zhang to our board will aid the Company in our aim to grow as a leading consumer lending marketplace that’s focused on strict risk management, transparency, and business innovation,” said Dr. Zane Wang, CEO of the Company.

“I have strong belief that with its innovative technology and multi data, multi channel strategy, as well as its rigorous risk management practices, China Rapid Finance has unparalleled advantage to thrive in this huge, untapped market." Mr. Zhang said. "I'm glad I can join China Rapid Finance to contribute my experience to its promising development in the future."

CRF aims at bringing affordable consumer credit to EMMAs, which are defined as Emerging Middle-class, Mobile Active consumers in China. There are 500 million such people, with quality employment, yet no credit record in the People’s Bank of China, which means they cannot get access to traditional credit service from banks.

Mr. Zhang brings to CRF’s board a wealth of industry knowledge and experience after having spent more than two decades in investment banking and finance. Prior to working at China Smartpay, Mr. Zhang served as the Chairman of Wansui Microcredit Company in Guangzhou from 2011-12. His work was recognized by The Microcredit Association of China, which named Mr. Zhang "Microcredit Person of the Year" in January 2012.

From 2006 to 2008, Mr. Zhang was the chief operating officer of Shenzhen Investment Limited. Earlier, he worked for various investment banks for 15 years, including 11 years with UBS as a banker and head of China Research. While at UBS in 2001, he became well known for publishing research that highlighted the weak governance and financial reporting issues of some companies listed on the Stock Exchange of Hong Kong. From 1986 to 1989, Mr. Zhang worked as a manager at the People's Bank of China.

Mr. Zhang is also the author of the bestseller Inside China's Shadow Banking: The Next Subprime Crisis, which was published in 2013. He has authored numerous articles that have appeared over the past two decades in publications including The New York Times, The Wall Street Journal, Financial Times, Bloomberg and South China Morning Post.

Mr. Zhang received a bachelor’s degree in Economics from Hubei Institute of Economics and Finance, a master’s degree in Economics from the PBOC Finance Institute and a master’s degree in Economics from the Australian National University.

About China Rapid Finance

China Rapid Finance Limited began its operations in 2001, and is the largest online consumer lending marketplace serving China’s emerging middle class in terms of total number of loans. The Company is a recognized innovator with a proprietary Big Data analytics technology platform. The Company has a proven track record in credit risk management and transparency, and has facilitated more than 5 million loans to-date.

HDFC to raise Rs 500 crore by issuing bonds to finance housing biz

The bonds with a tenor of five years, have April 26, 2021, as the redemption date

To cater to housing finance needs, India's largest mortgage lender HDFC on Monday said it will raise Rs 500 crore by issuing bonds on a private placement basis.

Issue size of Rs 500 crore secured redeemable non-convertible debentures, to be held on private placement basis, will carry a coupon rate of 8.35% per annum.

"The object of the issue is to augment the long-term resources of the corporation. The proceeds of the present issue would be utilised for financing/refinancing the housing finance business requirements of the corporation," HDFC said in a regulatory filing.

The bonds with a tenor of five years, have April 26, 2021, as the redemption date.

HDFC said the issue can be subscribed by only the persons who are specifically addressed through a communication by the company.

Scrips of the company traded 1.77% down at Rs 1,111.40 apiece on BSE.

IndusInd Bank all set to foray into affordable housing loans

IndusInd Bank is all set to foray into the affordable housing finance business and will be launching its first product in this segment by the end of the current quarter, Sumant Kathpalia, head – consumer banking, said after the bank’s March quarter results were announced.

IndusInd Bank is all set to foray into the affordable housing finance business and will be launching its first product in this segment by the end of the current quarter, Sumant Kathpalia, head – consumer banking, said after the bank’s March quarter results were announced.

“We have identified affordable housing as the correct avenue to venture into home loans. Typically, home loans are a product which does not really bear any fruit for the company unless the book is around R10,000 crore or more. But with affordable housing, we could achieve that with a R 2,000-crore book,” Kathpalia said.

In order to provide a fillip to the affordable housing market and to make it easier for individuals to finance their plans of buying a house, the Reserve Bank of India announced in October last year that lenders could lend up to 90% of the price of a house that costs R30 lakh or less. For houses costing between R30 lakh and R75 lakh, the loan-to-value (LTV) ratio was fixed at 80%, while for houses costing above R75 lakh the LTV was fixed at 75%.

At present, IndusInd Bank does not give home loans on its own. In fact, the bank has partnered with Housing Development and Finance Corporation and originates loans for the mortgage lending major. Kathpalia said that foraying into the affordable housing market will also help the bank meet its priority sector lending targets.

“We have a whole team working on it at the moment. We have everything ready to go and we will put our first step in that direction by the end of this quarter,” he said, adding that the new avenue will help the bank cross-sell more of its products.

“The cross-sell into our own clients’ infrastructure will give us the money. The contract-for-difference business for example, is a real cross-seller,” he added.

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Ujjivan expects to start small finance banking operations in 2017

Ujjivan Financial Services will launch its initial public offer on 28 April to raise about Rs358.16 crore

Microfinance lender Ujjivan Financial Services Ltd will launch its initial public offer (IPO) on 28 April and expects to start its small finance bank (SFB) in the first quarter of calendar year 2017, the top management of the company said on Thursday.

“The Reserve Bank of India (RBI) has given a timeline till April 2017 for launching the operations. We are confident that we will be able to do a soft launch of the small finance bank business by in the first quarter of next calendar year,” chief financial officer Sudha Suresh told reporters at a press meet in Mumbai.

The company’s significant scale, a geographically well-diversified business, senior management team with banking experience and robust risk management practices will help it in successfully building its small finance banking business, added Suresh.

Through its IPO, Ujjivan plans to raise Rs.358.16 crore. The company has fixed a price band of Rs.207-210 per share. The offer closes on 2 May.

The offer will also see several private equity investors in the company pare their stakes to ensure the company’s compliance with RBI’s norms of foreign ownership for SFBs, which require foreign ownership to be capped at 49%.

Investors selling their shares through the IPO include World Bank arm IFC, impact investment funds Elevar and India Financial Inclusion Fund, Dutch development finance institution FMO, Sarva Capital, Women’s World Banking Capital Partners, Wolfensohn Capital Partners and Mauritius Unitus Corp.

In February, Ujjivan raised fresh capital to the tune of Rs.292 crore in a so-called pre-IPO round. The pre-IPO round and IPO will help the company bring down its foreign shareholding to within 49%, the company said.

“After the pre-IPO round our foreign shareholding stands at around 77% and post the IPO the foreign shareholding will reduce to around 44-45%,” said Sudha Suresh. As of 31 March 2015, foreign investors owned 88.69% stake in Ujjivan.

Ujjivan is the second of 10 SFB licensees to start selling shares to the public. Earlier this month, the public offer of Chennai-based microfinance lender Equitas Holdings Ltd that sought to raise Rs.2,176 crore was subscribed almost 17 times.

On Thursday, Equitas’ shares listed on the stock exchanges with a 33.6% premium over its IPO price of Rs.110 per share.

SFBs will offer basic banking services, accept deposits and lend to unserved sections, including small business units, small and marginal farmers, micro and small industries, and entities in the unorganized sector.

For the nine months ended December 2015, Ujjivan reported a profit of Rs.122.3 crore on revenue of Rs.729.6 crore.

As of 31 December, the company served over 2.77 million active customers through 470 branches across 209 districts. Ujjivan’s assets under management stood at Rs.4,589 crore. The company is present in 24 states.

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Druva gets strategic investment from NTT Finance, expands in Japan

Druva is trying to tap into the growing Asia Pacific market for security

Druva Inc., a start-up that helps enterprises protect and manage their data across devices, said it received a strategic investment from NTT Finance, the financial arm of Japanese telecommunications company Nippon Telegraph and Telephone Corporation, to strengthen its presence in Japan.

Druva is trying to tap into the growing Asia Pacific market for security software. Last year, it entered Japan by localising its products in partnership with NTT Neomeit and NetOne Systems.

“We see our Japanese market expansion as a way to sustain the continued doubling of our global business each year with the Japanese growth significantly in excess of this,” Jaspreet Singh, chief executive officer of Druva, said in an email.

“We believe Druva will simplify and strengthen Japanese companies’ information security and compliance efforts, and that’s why we are investing in the company,” said Masayuki Utada, senior executive manager, International Business Unit, NTT Finance, in a statement.

Enterprises deal with vast amounts of data spread across multiple devices. For companies, it is crucial that all this data is continuously backed up, and is compliant with data governance policies. Druva has two products that deal with this—inSync, which helps companies protect data in end-user devices such as laptops or mobile phones, and Phoenix, which helps companies remotely backup and archive their server data.

However, when Jaspreet Singh, Milind Borate and Ramani Kothandaraman started Druva in 2008, they set out to build a very different product - one that dealt with disaster recovery software. On realising that it was very difficult for Indian companies to sell such a product, they shifted to data protection.

Druva serves over 4,000 enterprise customers with 65% of them in the Americas, 25% in Europe and the Middle East and 10% in the Asia Pacific region.

The Sunnyvale, California-based company has all its engineering team in its Pune office in India, with the sales, marketing, product and finance teams in the US.

Druva was identified as one of the top 30 product companies in the country according to the iSPIxB2B index by software products think-tank iSpirt, which tracks the software products industry.

It has so far raised $67 million from investors including Sequoia Capital, Tenaya Capital and Nexus Venture Partners, and counts iSpirt co-founder Sharad Sharma as an angel investor.

Druva competes with large enterprises such as EMC Corp., Symantec Corp., and Hewlett Packard Enterprise.

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Future Generali joins hand with 10 banks for micro insurance push

Future Generali India Insurance Company joins hands with 10 cooperative banks in Maharashtra to grow rural business. 
The tie-ups will help the insurer expand its market in the state as the company looks to grow bancassurance business by 50% this fiscal. 

"We have always been focusing on tying up with cooperative and rural banks to provide micro insurance and rural insurance to the wider section of the society," said Anurag Sinha, head of bancassurance. 

The insurer, a joint venture between retail giant Future Group and Italy's Generali, has tied up with banks such as Warana Sahakari Bank, Sangali District Central Cooperative Bank, Kolhapur District Central Cooperative Bank operating in the Kolhapur and Sangli districts. 

"These tie-ups are vital to provide financial access to rural households, thus ensuring better standards of living. We expect rural and micro insurance to grow by 30% by end of 2016-17," said KG Krishnamoorthy Rao, managing director and chief executive of Future Generali India Insurance Company. 

The company is also doing business with banks like Ashta Peoples Cooperative Bank, Kumbhi Kasari Cooperative Bank and Yashwant Sahakari Cooperative Bank in the region.

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Mudra Bank invests Rs.50 crore in Janalakshmi Financial Services

Mudra Bank invested Rs50 cr in Janalakshmi Financial Services through a securitization deal facilitated by IFMR Capital

Mudra Bank, a refinance bank for microfinance and non-banking financial companies, has invested Rs.50 crore in Janalakshmi Financial Services Pvt. Ltd through a securitization deal facilitated by IFMR Capital. This is Mudra Bank’s first capital market transaction.

Mudra, or the Micro Units Development & Refinance Agency, is a government initiative to provide cheap loans to companies that finance micro and small companies. IFMR Capital, in a statement on Wednesday, said it had exclusively structured and arranged a securitization transaction where MUDRA would investRs.50 crore in the A (-) rated senior tranche of securitized loan portfolio of Janalakshmi.

Securitization allows companies to provide part of their loan books and its receivables as a guarantee to financial institutions. In this short-term transaction, the tenure is 1.5 years. IFMR Capital also participated as an investor through its investment in the subordinated j tranche, it said. The Economic Times reported that IFMR has put in Rs.1.63 crore.

“Structured financing has a greater impact in enabling financial institutions to access funds from capital market at a lesser cost, without a charge on their limited capital. We hope to participate in more such transactions,” said Jiji Mammen, chief executive, Mudra Bank.

IFMR has structured 18 securitization and assignment transactions so far for Janalakshmi to raise around Rs.2,000 crore. “With this transaction, Mudra plays a facilitating role in ensuring that NBFCs providing microfinance and small business finance are able to access domestic capital in an efficient manner,” said Kshama Fernandes, CEO of IFMR Capital.

Small finance bank licensee Janalakshmi Financial said on Monday it has raised $150 million (around Rs.1,000 crore) in a round of primary funding led by global private equity firm TPG.

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