REG - ASA Intnl. Grp PLC - ASA International February 2022 business update
22/03/2022 07:00
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RNS Number : 5096F ASA International Group PLC 22 March 2022
Press release
ASA International Group plc February 2022 business update
Amsterdam, The Netherlands, 22 March 2022 - ASA International, ('ASA
International', the 'Company' or the 'Group'), one of the world's largest
international microfinance institutions, today provides the following update
of the impact of Covid-19 on its business operations as at 28 February 2022.
· Liquidity remains high with approximately USD 103m of unrestricted
cash and cash equivalents across the Group.
· The pipeline of funding deals under negotiation totalled
approximately USD 211m.
· With the exception of India and Myanmar, all other operating
subsidiaries continued to achieve collection efficiency of more than 90% and 9
countries achieved more than 95%.
· India collections remained at 76%, due to the substantial overdue
collections and moratoriums provided to clients. Collection efficiency,
excluding instalments due from clients receiving the one-time loan
restructuring offered by the Reserve Bank of India ('RBI'), increased to 102%.
· Collections in Myanmar decreased to 72%, due to the ongoing conflict
and an internet and electricity outage in the conflict affected areas.
· The benchmark PAR>30 for the Group, including off-book loans and
excluding loans overdue more than 365 days, slightly increased from 6.4% to
6.8%, primarily due to the end of the moratoriums in Myanmar, and PAR>90
decreased from 4.0% to 3.5%.
· The PAR>30 for the Group's operating subsidiaries, excluding India
and Myanmar, slightly increased from 1.8% to 1.9%.
· Excluding all loans which have been overdue for more than 180 days
and, as a result, have been fully provided for, PAR>30 increased from 3.8%
to 4.6%.
· Disbursements as percentage of collections exceeded 100% in 6
countries. The decreasing percentage in India was primarily due to the
strategic decision to reduce disbursements.
· With the number of clients broadly stable at 2.4m (slightly higher
than in January and 2.9% lower than in February 2021), and the continuing
strategic focus in India on only collections, Gross OLP decreased to USD 424m
(0.2% lower than in January 2022 and 7% lower than in February 2021).
· The moratorium amount decreased to USD 23.8m, and is composed of the
restructured loans of certain distressed clients in India as per the RBI
guidelines. No other operating subsidiary granted moratoriums.
Health impact of COVID-19 on staff and clients
· Since March 2020, the number of staff members confirmed as infected
by Covid increased to 549 of over 12,800 staff, with two deaths. Confirmed
infections amongst 2.4m clients increased to 22,791 from 21,659 in the
previous month, resulting in 697 deaths since the start of the pandemic. Of
the 697 client deaths across the Group, 451 took place in Myanmar, with no
deaths occurring in February 2022.
Funding
· Unrestricted cash and cash equivalents remained high at approximately
USD 103m.
· The Company secured approximately USD 6m of new loans from local and
international lenders in February 2022.
· The majority of the Company's USD 211m 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 28 February 2022((1))
Countries Sep/21 Oct/21 Nov/21 Dec/21 Jan/22 Feb/22
India 64% 70% 69% 74% 76% 76%
Pakistan 99% 99% 99% 99% 99% 100%
Sri Lanka Nil((2)) 91% 92% 94% 93% 93%
The Philippines 96% 97% 97% 97% 98% 98%
Myanmar 55%((3)) 68%((3)) 75%((3)) 78%((3)) 78%((3)) 72%((3))
Ghana 99% 100% 99% 99% 99% 99%
Nigeria 95% 96% 97% 96% 95% 96%
Sierra Leone 91% 93% 92% 92% 92% 92%
Kenya 100% 100% 100% 100% 99% 100%
Uganda 89% 94% 98% 100% 100% 100%
Tanzania 100% 100% 100% 100% 100% 100%
Rwanda 96% 97% 97% 97% 97% 97%
Zambia 100% 99% 99% 99% 100% 100%
((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)) The collection efficiency for 1-29 September 2021 is nil due to the
lockdowns in Sri Lanka.
((3)) 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 remained at 76%, due to the substantial overdue
collections and moratoriums provided to clients. Collection efficiency,
excluding instalments due from clients receiving the one-time loan
restructuring, increased to 102%.
· Collection efficiency in India, including regular and overdue
collections as well as advance payments, increased to 101% as a percentage of
the regular, realizable 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.
· Collections in Myanmar decreased to 72%, due to the ongoing conflict
and an internet and electricity outage in the conflict affected areas.
Loan portfolio quality up to and including February 2022((5, 6, 7) )
Gross OLP (in USDm) Non-overdue loans PAR>30 less PAR>180
Dec/21 Jan/22 Feb/22 Dec/21 Jan/22 Feb/22 Dec/21 Jan/22 Feb/22
India (total) 113 111 107 67.3% 68.8% 69.7% 12.3% 11.1% 10.2%
Pakistan 79 81 83 99.7% 99.7% 99.7% 0.2% 0.2% 0.2%
Sri Lanka 8 8 8 87.2% 85.3% 85.9% 3.6% 3.9% 4.1%
Philippines 47 46 47 95.7% 94.9% 95.7% 2.3% 2.0% 1.9%
Myanmar 20 21 21 97.8% 64.3% 58.5% 0.6% 1.0% 22.7%
Ghana 49 46 44 99.3% 99.2% 99.3% 0.2% 0.3% 0.2%
Nigeria 40 37 37 92.7% 90.9% 90.6% 2.8% 3.4% 3.6%
Sierra Leone 7 7 7 87.4% 72.3% 71.1% 5.6% 6.5% 7.1%
Kenya 17 17 18 98.6% 98.6% 98.6% 0.5% 0.5% 0.6%
Uganda 10 10 10 89.8% 90.7% 91.7% 3.1% 1.9% 0.9%
Tanzania 35 36 37 99.1% 99.1% 99.1% 0.2% 0.2% 0.1%
Rwanda 3 3 3 92.9% 92.6% 92.4% 2.6% 3.0% 3.2%
Zambia 2 2 2 98.2% 98.2% 97.7% 0.5% 0.5% 0.8%
Group 429 425 424 89.1% 87.5% 87.7% 4.1% 3.8% 4.6%
PAR>30 PAR>90 PAR>180
Dec/21 Jan/22 Feb/22 Dec/21 Jan/22 Feb/22 Dec/21 Jan/22 Feb/22
India (total) 22.8% 19.3% 17.1% 14.1% 11.6% 9.9% 10.5% 8.2% 6.9%
Pakistan 0.2% 0.2% 0.2% 0.2% 0.2% 0.1% 0.0% 0.0% 0.0%
Sri Lanka 6.0% 6.6% 6.9% 4.0% 4.0% 4.3% 2.5% 2.8% 2.8%
Philippines 2.5% 2.5% 2.7% 1.5% 1.9% 2.0% 0.3% 0.6% 0.8%
Myanmar 1.1% 1.6% 23.3% 0.7% 1.0% 0.9% 0.5% 0.6% 0.5%
Ghana 0.3% 0.3% 0.3% 0.2% 0.2% 0.2% 0.1% 0.1% 0.1%
Nigeria 4.6% 5.4% 5.8% 3.1% 3.6% 3.8% 1.8% 2.0% 2.2%
Sierra Leone 7.5% 8.7% 9.5% 4.0% 5.5% 6.2% 1.9% 2.2% 2.4%
Kenya 1.1% 1.0% 1.1% 0.8% 0.8% 0.8% 0.5% 0.5% 0.5%
Uganda 3.8% 2.9% 2.4% 3.4% 2.8% 2.3% 0.7% 0.9% 1.4%
Tanzania 0.5% 0.4% 0.4% 0.4% 0.4% 0.3% 0.3% 0.3% 0.3%
Rwanda 4.5% 4.8% 5.1% 3.2% 3.2% 3.3% 1.9% 1.8% 1.9%
Zambia 0.7% 0.8% 1.1% 0.5% 0.5% 0.5% 0.2% 0.2% 0.3%
Group 7.3% 6.4% 6.8% 4.6% 4.0% 3.5% 3.1% 2.6% 2.2%
( )
((5) ) Gross OLP includes the off-book BC and DA model, excluding interest
receivable and before deducting ECL provisions and modification loss.
((6) ) 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 3% of the Gross OLP.
((7) ) 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 slightly increased to 6.8%, primarily due to
the portfolio deterioration in Myanmar as moratoriums were no longer provided
to clients with overdue loan payments.
· PAR>30 for Sierra Leone increased to 9.5% due to the increased
OLP/client.
· Credit exposure of the India off-book BC portfolio of USD 33.7m is
capped at 5%. The included off-book DA portfolio of USD 1.7m has no credit
exposure.
Disbursements vs collections of loans until 28 February 2022((8))
Countries Sep/21 Oct/21 Nov/21 Dec/21 Jan/22 Feb/22
India 52% 39% 85% 88% 78% 65%
Pakistan 100% 100% 98% 100% 100% 96%
Sri Lanka Nil((9)) 86% 100% 113% 70% 115%
The Philippines 89% 90% 90% 81% 80% 93%
Myanmar 37% 73% 90% 95% 99% 99%
Ghana 120% 111% 114% 108% 74% 110%
Nigeria 110% 128% 134% 93% 71% 98%
Sierra Leone 124% 112% 112% 110% 97% 102%
Kenya 100% 96% 103% 55% 95% 101%
Uganda 109% 115% 121% 69% 81% 112%
Tanzania 100% 107% 109% 107% 114% 112%
Rwanda 102% 101% 105% 98% 65% 80%
Zambia 102% 110% 111% 109% 76% 80%
((8)) Disbursements vs collections refers to actual loan disbursements made to
clients divided by total amounts collected from clients in the period.
((9)) Disbursements vs collections for September is nil due the nationwide
lockdowns.
· Disbursements as percentage of collections exceeded 100% in 6
countries. The decreasing percentage in India was primarily due to the
strategic decision to reduce disbursements.
Development of Clients and Outstanding Loan Portfolio( )until 28 February
2022
Clients (in thousands) Delta Gross OLP (in USDm) Delta
Countries Feb/21 Jan/22 Feb/22 Feb/21-Feb/22 Jan/22-Feb/22 Feb/21 Jan/22 Feb/22 Feb/21-Feb/22 USD Feb/21-Feb/22 CC ((10)) Jan/22-Feb/22 USD
India 729 521 498 -32% -4% 166 111 107 -35% -34% -3%
Pakistan 432 520 530 23% 2% 69 81 83 20% 34% 2%
Sri Lanka 56 52 52 -7% 0% 9 8 8 -10% -7% 2%
The Philippines 313 290 295 -6% 2% 50 46 47 -7% -2% 2%
Myanmar 128 112 111 -13% -1% 30 21 21 -30% -11% 1%
Ghana 154 158 161 4% 2% 44 46 44 -1% 16% -5%
Nigeria 256 246 245 -4% 0% 32 37 37 16% 27% -1%
Sierra Leone 38 43 43 12% -2% 5 7 7 38% 59% 0%
Kenya 99 118 120 22% 2% 14 17 18 27% 32% 4%
Uganda 81 92 93 15% 2% 8 10 10 29% 25% 2%
Tanzania 129 179 185 44% 4% 22 36 37 64% 64% 3%
Rwanda 18 18 18 -1% -1% 3 3 3 18% 22% -1%
Zambia 6 15 16 145% 3% 0.6 2 2 280% 210% 2%
Total 2,439 2,364 2,368 -2.9% 0.1% 453 425 424 -7% 1% -0.2%
( )
((10)) 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 2.4m, and the continuing
strategic focus in India on only collections, Gross OLP decreased to USD 424m
(0.2% lower than in January 2022 and 7% lower than in February 2021).
Selected moratoriums((11)) on loan repayments until 28 February 2022
Clients under moratorium (in thousands)
Countries Dec/21 Jan/22 Feb/22 As % of Total Clients
India 205 205 205 41%
Pakistan 0 0 0 0%
Sri Lanka 0 0 0 0%
The Philippines 0 0 0 0%
Myanmar 44 0 0 0%
Ghana 0 0 0 0%
Nigeria 0 0 0 0%
Sierra Leone 0 0 0 0%
Kenya 0 0 0 0%
Uganda 0 0 0 0%
Tanzania 0 0 0 0%
Rwanda 0 0 0 0%
Zambia 0 0 0 0%
Total 249 205 205 9%
Moratorium amounts (USD thousands)
Countries Dec/21 Jan/22 Feb/22 February Moratoriums as % of OLP As % of Total Moratoriums
India 28,351 25,950 23,782 22% 100%
Pakistan 0 0 0 0% 0%
Sri Lanka 0 0 0 0% 0%
The Philippines 0 0 0 0% 0%
Myanmar 778 0 0 0% 0%
Ghana 0 0 0 0% 0%
Nigeria 0 0 0 0% 0%
Sierra Leone 0 0 0 0% 0%
Kenya 0 0 0 0% 0%
Uganda 0 0 0 0% 0%
Tanzania 0 0 0 0% 0%
Rwanda 0 0 0 0% 0%
Zambia 0 0 0 0% 0%
Total 29,129 25,950 23,782 6% 100%
((11)) 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 primarily to approximately 41%
of clients in India, who accepted to benefit from the one-time debt
restructuring scheme established by the RBI and confirmed in September 2021.
See RBI Covid-19 Restructuring Guidelines
(https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12086&Mode=0) .
· The moratorium amount across the Group decreased to USD 23.8m, which
represents 6% of the Group's Gross OLP.
Key events in March 2022
· On 14 March 2022, the RBI announced new regulation for the
microfinance sector in India, applicable to all banks, NBFC-MFIs and other
participants in the microfinance sector. The Group's preliminary assessment is
that this is a positive development for ASA India as it creates a level
playing field in the microfinance sector. The key changes include the removal
of the interest rate cap and margin cap, loans shall be collateral-free (also
for banks providing microfinance loans), and lenders will be restricted to
provide microfinance loans to clients up to a maximum of 50% of the client's
household income. See Reserve Bank of India - Notifications (rbi.org.in)
(https://rbi.org.in/Scripts/NotificationUser.aspx?Id=12256&Mode=0)
· Other than the existing partial lockdown and curfews in Myanmar, the
Company is not aware of any further restrictions implemented in its operating
countries as a result of the emergence of the Omicron variant up until 17
March 2022.
Please note that, while the Company's operational performance appears to
gradually normalize in most countries except for India and Myanmar, the risk
of additional challenges to our operations should not be underestimated, due
to (i) the still relatively high infection rates, (ii) the current lack of
available vaccines as well as vaccine hesitancy in most of our operating
countries, (iii) the risk of the introduction of more infectious Covid
variants in our operating countries, and (iv) the associated disruption this
may cause to the businesses of our clients.
---
Enquiries:
ASA International Group plc
Investor
Relations
+31 6 2030 0139
Véronique
Schyns
vschyns@asa-international.com
(mailto: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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