Our Best Year Ever!

Annual Report 1 2 4 6 8 30 32 34 37 14 20 26 30

......

...... Photo credits: Tracy Kay, WireImage/Nielsen Barnard, Jem Mitchell, FINCA Staff Jem Mitchell, WireImage/Nielsen Barnard, Kay, Tracy credits: Photo Innovative Products and ServicesInnovative Products did what was rightWe did it wellWe the Lead took We Report Financial Team ManagementFINCA International Executive and Advisory Directors of FINCA Global Boards Boards FINCA International Staff Donor Gifts ...... Give to Ways Founder’s Letter Letter Founder’s CEO & the Chairman and the President from Letter The FINCA Network CONTENTS

vision serving collectively be a global network poor entre- more To other MFI while operating on commercial than any preneurs principles of performance and sustainability.

The mission of FINCA® is to provide financial services theto provide mission of FINCA® is to The jobs, so they can create entrepreneurs lowest-income world’s of living. their standard build assets and improve mission statement mission FoundeLetterLe Dear Friends,

s colleagues at FINCA will readily confirm, I have a penchant for superlatives—like “biggest,” “best,” “greatest”— or unbridled optimism—like “We’re almost there,” “This is a huge break-through,” and my personal favorite “I’m too blessed to be stressed.” Such words match my eternal optimism, an indispensable attribute for a founder who, from day one, has believed that the destiny of village banking is to be one critical tool in the effort to end Asevere poverty on our planet. Within this hyperbolic context, the theme of 2011 as FINCA’s “Best Year Ever” fits nicely. Actually, anyone who has known FINCA for more than a decade will readily agree that over our 27 year life-span, each year has been steadily better than its predecessor. But 2011 was indeed an exceptional year. FINCA’s client growth rate surged to over 900,000. Client savings continued to grow in countries where we are licensed to accept them, allowing clients to create their own safety nets. Our Africa region programs joined Eurasia in becoming fully sustainable for the first time, and many of our Subsidiaries began updating their computerized information systems. And the formation of FINCA’s new holding company has ushered in a new era of outreach that will be unprecedented in our more than a quarter-century history. All this was achieved in the midst of a global economic crisis. But there’s more and, in my opinion, it’s the most important part of all. 2011 was the year that FINCA’s board of direc- tors established its Social Performance Audit Committee (SPAC); FINCA staff conducted a comprehensive review of seven years of research data to measure program impact on client well-being; and FINCA pledged itself to a new campaign to both (1) target even-poorer clients and (2) promote new projects—such as food security, health, education, housing, and personal empowerment—that assist our clients to sustainably rise above the poverty line. This kind of alignment of purpose—from the board of directors down to the lowest-level credit officer—is also unprecedented in the global microfinance movement. As an adolescent, I remember that in the kitchen of our home hung a sign that read: “Grow old with me. The best is yet to be.” To FINCA’s many friends and supporters, I guarantee you that our best years are still ahead.

John Hatch Santa Fe, New Mexico

www.FINCA.org | 1 Lettert erfromrm thee Chairmann andd th e

Dear Friends and Colleagues,

he year 2011 will forever be remembered remains below 0.5%. In other words, an impressive as one that witnessed many historic highs, 99.5% of loans are repaid on time. including record growth and the launch of Similarly, FINCA’s seven Eurasian programs, FINCA Microfinance Holdings (FMH), a first- stretching over 5,000 miles from Kosovo to Siberia, Tof-its-kind, socially-responsible investment partnership ended 2011just shy of 367,000 active clients, with for microfinance. especially strong growth in Azerbaijan and Kyrgyzstan. In terms of outreach, the FINCA network ended Eurasia’s outstanding loan portfolio at year end stood at 2011 with nearly 910,000 active borrowers in our 21 a record $322.7 million. Subsidiaries in Africa, Eurasia, the Greater Middle East In Latin America, the region hit hardest by the global and Latin America, an increase of more than 18 percent. recession, we ended the year with 270,800 active clients The outstanding loan portfolio broke through the $500 in our seven Subsidiaries, and a portfolio of $117.5 million mark, which amounted to total disbursements million. FINCA Mexico, the largest program in the FINCA during the year topping $1 billion. This 32 percent increase network, grew its outreach by 16% in 2011, finishing the can be attributed to unexpectedly high portfolio growth year serving 142,500 clients—90% of them women. in a number of our larger programs, especially Azerbaijan, In terms of financial results, FINCA had its strongest Mexico, and the Democratic Republic of Congo. year ever, generating $255.9 million total revenues vs. In Africa, powered by rapid growth in Democratic total costs of $221.9, for a net revenue of $33.9 million. Republic of Congo and Tanzania, FINCA’s five African Total assets rose to $719.8 million vs. liabilities of $490 Subsidiaries combined to surpass 200,000 clients served million, resulting in total equity of $229.9 million, of with an average loan size of just $341. which $66.6 million represents investment in FINCA In Afghanistan and Jordan, FINCA’s financial services Microfinance Holdings. We attribute these strong products, which include Islamic compliant, non-interest results primarily to the unexpectedly strong growth of bearing loans, allowed us to serve 24,875 clients. We’re the loan portfolio in a number of our larger programs, proud that, despite all the challenges of working in including Azerbaijan, Mexico, and the Democratic Afghanistan, our portfolio-at-risk in both countries Republic of Congo.

2 | www.FINCA.org Presidentt andd CEO

You may have read that in some countries, notably carefully-selected, socially-responsible investors who share Member views the future. We feel poised to have another India, certain ‘bad actors’ misused microfinance to enrich our poverty alleviation mission, all of whom we have been outstanding year, both in terms of our mission and our themselves and, in the process, over-indebted their working with for many years, and who have collectively financial results. clients and engaged in abusive collection practices. provided FINCA with over $200 million in loans annually. As always, we’re grateful to, and humbled by, our Among the steps we have taken to ensure that FINCA The benefits from its formation give FINCA the capital tens of thousands of donors, lenders and investors in continues to practice “responsible microfinance,” we have to expand, as well as provide new financial and life- the US, Canada, United Kingdom and around the world joined the global SMART Campaign, through which all enhancement services, like savings accounts, that our who continue to support our outreach to hundreds of of our Subsidiaries adhere to seven principles of client clients can use to build safer, more secure livelihoods. thousands of micro-entrepreneurs and their families. protection and socially responsible microfinance. The FMH helps us substantially increase the number of We remind ourselves daily that, without the gifts of your Microfinance CEO Working Group, a consortium of the people we can reach with these services, and will create time, talents and financial resources, we would never CEOs of eight major microfinance global networks, efficiencies in the FINCA network, driving down our cost have accomplished all we have in the past, nor would we co-chaired by Rupert, met monthly throughout 2011 of serving the poorest microentrepreneurs. Finally, we be facing such thrilling future prospects. We thank you with the dual objective of ensuring that our affiliates and have ensured that no staff or board members of FINCA for helping us continue to transform lives throughout the subsidiaries adhere to socially responsible microfinance, International or FINCA Microfinance Holdings will be per- world, and to bring hope to millions more in the future. and also begin to publicly address some of the unfair mitted to hold shares in FMH, thus ensuring we remain criticism being leveled at the industry. aligned with the interests of our clients. Sincerely, By far the most significant achievement of 2011, The practical meaning of this for you, our supporters, however, was the creation of FINCA Microfinance Holdings is that every dollar contributed to FINCA is now leveraged (FMH) through which, for the first time, we were able to by four different sources of capital: other donations, Robert W. Hatch attract socially-responsible investment capital into our commercial loans, investor capital, and our beneficiaries’ Chairman system. FMH provides even greater leverage to the global savings. Talk about a multiplier effect that enhances the pool of capital FINCA has built up over the years, thanks overall impact of our programs on global poverty! to the generosity of our donors and supporters in the pri- Coming off of the banner year that was 2011, we vate and public sectors. FMH makes it possible for us to are heartened by the excitement and optimism with Rupert W. Scofield bring in equity partners from among a small number of which each and every FINCA employee and Board President and CEO

www.FINCA.org | 3 FINCWorldwideA

909,710 borrowerss, setting a neww recordd for Azerbaijan Georgia active clients Kosovo Armenia $513 million in microloans outstanding, Jordan representing a 32% increase Haiti Honduras $1 billion in smalll loans disbursedd during 2011 Mexico Guatemala 1.4 percent portfolio att riskk greaterr than 30 days El Salvador Uganda Nicaragua Democratic Republic 21 Subsidiaries worldwide are run byy teams of Ecuador of the Congo dedicated professionals with an intimate Malawi Zambia knowledge off the locall markett andd culture. Tanzania More than 8,500 employees provide client- focusedd financiall services to poorr entrepreneurs in Three-Year Summary of Performance both urban andd rurall settings. 2009 2010 2011 Total Borrowers 717,217 764,769 909,710 228,000 clients voluntarilyy save on a regularr basis, Average Disbursed bringing totall savings to $177 million, equating to Loan Size $519 $597 $677 an average savings amount off $75 perr client. Gross Total Loan Portfolio1 $327,929,481 $386,996,094 $512,787,594 FINCA’s credit/life insurance policies in Latin Total Amount Disbursed $682,196,684 $802,422,681 $1,049,668,647 America and Africa coverr more than 1.3 million Portfolio at Risk lives through the addition off a smalll fee to the greater than 30 days 2.9% 1.3% 1.5% overalll loan. 1Includes interest receivable on loans and advances

4 | www.FINCA.org RussiaR KyrgyzstanKyrgyzstastan TajikistanTajikistan Afghanistan

2011 Summary of Performance Total Average Gross Total Total Portfolio at Region Borrowers Disbursed Loan Amount Risk Greater Loan Size Portfolio1 Disbursed than 30 days Africa 247,258 $341 $64,440,191 $172,398,826 2.2% Eurasia 366,746 $1,225 $318,948,627 $476,711,890 0.6%

GME 24,875 $585 $9,937,249 $15,246,482 0.6%

Latin America 270,831 $613 $119,425,527 $385,311,449 3.6%

Total 909,710 $677 $512,787,594 $1,049,668,647 1.5%

1Includes interest receivable on loans and advances

www.FINCA.org | 5 Financialand Products Innovations

6 | www.FINCA.org Financial Products

Village Banking and Small Group Loans, our core products, offer low- income entrepreneurs group loans without collateral requirements. Savings Accounts help clients create their own safety nets to guard against emergencies and invest in their futures. Individual Loans allow clients whose capital needs are larger than those of the village bank to invest in their growing businesses and generate employment. Product Innovation Microinsurance products—health, Rural Loans help under-served clients purchase seeds, fertilizer, livestock credit-life, hospitalization and and equipment to achieve higher farm yields and increased incomes. funeral expenses—provide new Islamic microfinance products, approved by local religious leaders, enable levels of protection and security. FINCA to offer culturally appropriate financing in Afghanistan and Jordan. Money Transfer services strengthen Microenergy Loans let clients purchase or lease clean electricity systems financial links across borders so they can create, or expand, small businesses. The systems also improve and between urban and rural living conditions by eliminating the need to burn kerosene for fuel. communities, allowing clients to send or receive money for business Point of Sale, ATM and Branchless Banking pilot programs can create a or family purposes. low-cost delivery channel for reaching the lowest-income clients worldwide.

www.FINCA.org | 7 We did

8 | www.FINCA.org Our best what was wasyear ever!right right

www.FINCA.org | 9 WeWee setdid highd what standardst wass romises made to be ethical and do no harm of our clients and their families, making sure that we impact of their work in the lives of poor clients. are empty unless an organization is willing uphold FINCA’s brand promise. FINCA’s programs in Ecuador and Mexico were to put its commitment to high standards One of the first steps the Committee undertook ranked in the Top 100 by Microfinance Americas, into writing and practice. For FINCA, that was to author a specific, comprehensive and measure- a publication of the Multilateral Investment Fund Pmeans putting words into actions, continually taking able definition of FINCA’s social performance. To be of the Inter-American Development Bank and the stock of how we’re doing, and making changes that successful in our commitment to social performance, Microfinance Information Exchange (Mix), for their are right for our clients, not just our organization. we need to show that we’ve: outstanding outreach, transparency and efficiency. In 2010, FINCA took an industry lead by establish- ■ Expanded access to financial services, primarily Being socially responsible means adding value ing a permanent Social Performance Audit Committee among underserved, low-income people through our work so that our clients can add value to at the Board Level and, in 2011, the Committee em- and communities; their businesses, family livelihoods and communities. barked on a comprehensive initiative to monitor and ■ Increased employment and incomes; We see the results of our actions every day in clients manage social performance that includes identifying ■ Improved living standards; like Jesca Makumbi. and tracking social performance indicators on an on- ■ Empowered our clients and helped them achieve Jesca is a 34-year-old mother who shares her going basis to ensure that FINCA remains focused on their personal aspirations and those they hold life with her husband and son named Goodluck in client welfare and protection, increases transparency for their families; and Kitunda, Tanzania. Life had been going well for the with partners, and develops new products that are ■ Acted responsibly and equitably towards all young couple until 1999, when her mother died, tailored to enhance client well-being. stakeholders, and the communities of which we leaving Jesca, at the age of 21, not only with the pain Establishing FINCA’s Social Performance Audit are a part. of losing her, but with the responsibility of raising her Committee was the next logical step in our unwaver- The institutionalization of both the Social three younger siblings. ing commitment to improve the livelihoods of our Performance Audit Committee and Social Up to that point, Jesca and her husband relied clients through the provision of products and services Performance targeting and measurement is, indeed, a solely on income he received from his job as a meat identified as needed by our clients. milestone for FINCA, however conducting transparent vendor as well as some support from her mother, As early as 2003, FINCA pioneered the FINCA Client and accountable business practices is just the way we which had allowed Jesca to begin to save money Assessment Tool (FCAT), a comprehensive survey do business. As testament, in 2011, FINCA’s programs so she could purchase a plot of land on which she measuring an array of indicators including: business in Azerbaijan, El Salvador, Guatemala, Jordan, Russia planned to grow vegetables. But when the couple type and activity, daily per capita expenditure compo- and Tajikistan were all honored with the Consultative was suddenly faced with supporting her two sisters sition, housing, health and education. The information Group to Assist the Poor’s (CGAP) Social Performance and brother, and the added responsibility of paying collected helps FINCA measure the impact that our Reporting awards for their commitment to transpar- their school fees, Jesca knew she had to find a way to products and services have in the day-to-day lives ency and accountability in reporting about the direct contribute to the family’s income.

10 | www.FINCA.org right Jesca took her small savings and used it to purchase vegetables, which she sold from the home the family rented. She first learned about FINCA from a neighbor who was a member of FINCA Tanzania’s Valentine Village Banking group. The neighbor encouraged her to take a loan because she was convinced that it would help her expand her business. Jesca decided to join the group in 2005, and used her first loan of TZS 200,000 or about $130, to buy a variety of vegetables, rent a table at the local market, and pay school fees for her brother and sisters. Today, Jesca is in her 29th loan cycle with FINCA Tanzania, is still a member of the Valentine Village Banking group, and currently has a loan for TZS 1,500,000 ($950). She’s added another product line to her business—selling chickens—and can now count on a regular roster of clients. She contracts with a wedding planner to provide food for wedding parties, and also supplies vegetables, fruit and chickens to five hotels on a weekly basis. But according to Jesca, her greatest achievements are that she’s been able to save enough to purchase land and build a house, send all of her siblings through school—her youngest sister is now attending university—and her son is a high-achieving student at the English middle school. “I’m so proud to be part of the FINCA family, and I believe without FINCA loans, my family life wouldn’t be the way it is today,” Jesca says.

www.FINCA.org | 11 We did

12 | www.FINCA.org whatWe investedt was thes rightright way he economic turmoil of the past several us to create economic opportunity for even more of ter, working hard to provide the best she can for her. years brought to light one aspect of the the world’s hardworking entrepreneurs. Irma started her small sewing business in a shop in world of finance that is less than admirable This capital support will help our Subsidiaries the suburbs of Tbilisi. She worked hard, day in and day —plenty of organizations are willing to put transform into fully-licensed financial institutions and, out, but knew she wanted—and needed —to expand theT financial expectations of their shareholders and where possible, into banks, which will further enhance her capacity and output, but was uncertain how she board members at the top of their lists, and the needs our ability to provide more products that meet our could accomplish this. of their clients at the bottom. clients’ needs such as savings accounts and insurance Irma’s friends had often talked about their desire But at FINCA, that’s just not the way we do busi- products, and create efficiencies that help drive down to grow their small businesses, so they decided to ness. Never have; never will. costs of serving our clients, thus allowing us to lower find out more about FINCA Georgia. Once they felt In 2011, FINCA made some bold moves that are interest rates. secure enough to move forward, they formed a ground breaking in the microfinance industry, and In order to create FMH, five of the world’s most solidarity group in early 2011, and with her first loan, which go even further to solidify our commitment to highly-respected, socially-responsible investment Irma purchased a sewing machine for her daughter, FINCA’s mission to provide financial services to the institutions agreed to take their long-term support for and expanded her stock of fabrics and other sewing world’s unbanked women and men. FINCA’s mission to a whole new level by investing in materials. In a very short amount of time, the mother- On June 17th, FINCA announced the launch of this new model for growth. The investors include the daughter duo increased their income, and Irma used FINCA Microfinance Holdings (FMH) a first-of-its-kind, International Finance Corporation (IFC), a member some of her profits to move her workshop to the city socially-responsible investment partnership that of the World Bank Group; KfWBankengruppe, the center, where her sales increased dramatically. She has strikes the right balance between attracting the German development bank; FMO, the Netherlands even been able to purchase a car. capital needed for expansion while protecting the development bank; responsAbility Global Irma is now planning to hire additional seam- integrity of FINCA’s charitable mission. Deeply embed- Microfinance Fund, an investment fund advised by stresses to expand her business even more and, with ded in the charter for FMH is the fact that no board the Zurich-based asset manager responsAbility Social her next loan, she plans to buy special equipment that member or FINCA staff member will be allowed to in- Investments AG; and Triple Jump, a Netherlands- will allow her to offer embroidery services to different vest or have an equity interest in, or benefit financially based microfinance investment manager. local manufacturing brands. from, FMH. Outreach to even more clients as a result of FMH Irma says she considers FINCA to be her friend— FMH gives FINCA a whole new springboard for ex- is evident when you learn about women like Irma when she was a friend in need, FINCA was a friend, panding outreach and services. Over the next couple Noniashvili, a 36-year-old, single mother who lives indeed. She plans on having a long-term relationship of years, it’s expected that our client base will grow to in Tbilisi, Georgia. For more than a decade, Irma has with FINCA Georgia. 1.5 million people across our 21 Subsidiaries, allowing served as the sole provider for her 18 year-old daugh-

www.FINCA.org | 13 Our best year ever! We did it well

14 | www.FINCA.org www.FINCA.org | 15 16 | www.FINCA.org WeWe mete didclients’d needsitt well uch of the microfinance industry’s suc- FINCA has developed an overall Rural Financial sparsely populated country of Kyrgyzstan. In order to cess, FINCA included, has been through Services strategy that it employs before entering help her husband support their family and put their serving clients in urban and peri-urban new rural markets. The rationale has humanitarian, two boys and two girls through school, she started settings. Population density makes it business and macroeconomic development dimen- her own farm near the village of Kadyrsha in the Measier to reach larger numbers of people in more easily sions. The humanitarian argument is that rural areas Karasuu region, planning to sell her produce in the defined locations, and the existence of infrastructure, are where the majority of the world’s poor live and local market. including roads and public transportation, makes deliv- work. The business case is underpinned by rising com- She rose early each morning to milk her two cows, ering services easier and more cost effective. But what modity prices and the need to feed an increasingly and then set off to the village to sell the milk at the about the people who live in rural areas? hungry world. The development logic is based on the market. Things went slowly at first, but Kopaisin soon The challenges of serving rural clients have been fact that, in countries so far behind in other areas— started buying additional milk from her neighbors to well documented: high operational costs including technology, manufacturing, etc.—their best and only sell, because she saw there was enough demand in transportation and client servicing; dependence on area to compete is in agriculture, both for export and the village, with its large families. She knew she could subsidized credit sources; dependence on farming, domestic consumption. do better if she could buy more milk to sell—and even which has its own set of challenges including season- FINCA’s rural financial services efforts have been better if she could purchase more cows and expand ality of cash flows, lengthy crop cycles, and general developed and refined predominantly in the Eurasia her farm’s production of milk. agricultural risks, like pest infestations and weather region, where a prime example of success can be In 2004, Kopaisin learned about FINCA from her anomalies; isolated markets; and low levels of non- found in FINCA Azerbaijan’s efforts. Products for rural neighbors and she realized it could provide her with farm economic activity. areas and farm enterprises have grown to make up the capital she needed to build up her business and On the positive side, however, are numerous op- almost half of FINCA Azerbaijan’s $100 million loan boost her family’s living standards. Kopaisin joined a portunities which make rural finance a compelling portfolio, with the portfolio at risk greater than 30 local FINCA Village Bank and borrowed 1,000 Kyrgyz and worthwhile endeavor – high poverty reduction days less than 0.20 percent for rural loan products, Soms ($21) so she could buy more milk from neighbor- potential; rising prices and growing demand for farm 0.02 percent of Individual Agriculture Loans, and 0.0 ing farms. She plowed her profits into the farm and, goods; household income diversification including percent for Commercial Agricultural loans. over the years, her business has grown steadily, as have the ability to participate in remittance programs; less An inspiring example of the success of FINCA’s rural her FINCA loans. Today, Kopaisin is in her 14th loan competition due to fewer providers in the market- loan products is exemplified in the story of Kopaisin cycle with FINCA Kyrgyzstan, and owns ten cows that place; the ability to utilize technology and branchless Gonabaeva. produce up to 70 liters of milk a day. She is proud that banking services to lower costs; a population that Following the collapse of the Soviet Union, she has significantly increased her family’s income, and has a lower mobility rate; and greater social cohesion Kopaisin lost her job at a collective farm, like tens of that all her children have completed their educations. among local residents. thousands of other people in the mountainous and

www.FINCA.org | 17 WeWee wentdid beyondd itt well the expected t’s easy to continue serving the same clients with in 2011. This means that, on average, each client now ability made her feel that she was “good for nothing,” the same products, year after year, knowing that has $78 in a savings account that can be used as a but as she grew older, she decided that she could do you’ll reap the same rewards. But that’s not how safety net in case of emergency. whatever she set her mind to. To help her family earn new levels of achievement are reached, and not Worldwide, the results are also impressive as FINCA a little extra income, sshe began making fajas, beaded howI you expand your mission to serve even more of clients have accumulated savings deposits of more belts that are part of the traje típico or traditional the world’s poorest people. Creating new products than $17 million to invest in their businesses and rais- indigenous dress. With the limited money she had and services is one of the reasons 2011 was a banner ing their living standards. available, she could only afford to buy beads in very year for FINCA. In Uganda, where just 71% of girls attend primary small quantities. FINCA has been developing and deploying a myriad school, FINCA is helping more than 1,700 girls learn She learned about FINCA when a loan officer visited of products and services over the years that can greatly about financial literacy and the importance of saving her small community near Lake Atitlán in Sololá, improve our clients’ lives, and that can help us deliver through the FINCA Star Girls program. Many will Guatemala. With other nearby women entrepreneurs, cost savings to them. Our products can help clients use their savings to help pay for school fees and she became part of a village bank. They named them- create their own safety nets for unplanned circum- books, so they can finish their educations with op- selves Aguacatales (the trees which produce avocados), stances, so they’re less likely to fall back into poverty. portunities ahead of them, rather than a lifetime of hoping that, with FINCA’s help, their businesses would They can help families save for planned expenses, like diminished expectations one day grow as strong and tall. Catarina especially fees to send their children to school or home improve- Around the world, FINCA is using technology— liked being part of a group where she could learn from ment. They can make it safer, more convenient and handheld computers, point of sale (POS) terminals, older members about how to better run a business, less expensive to access and repay loans; provide ATMs, etc.—to make it easier, safer and cheaper for cli- and how to persevere after a loss. the added assurance that only having insurance can ents to bank with us. And in Uganda, clients can access With her first loan, Catarina was able to begin provide; and help our clients create new businesses microenergy loans to rent or purchase solar powered buying beads by the kilo and increase her profits. that they might not have ever thought possible. equipment that can be used to power their existing Currently, she relies on her aunts to sell the belts in the Our innovative savings programs in the Democratic businesses and homes, or start new businesses. market in Quetzaltenango. Her dream is to grow her Republic of Congo, Ecuador and Uganda have proved Going beyond the expected is exactly what FINCA business to the point where it is completely her own to be extremely popular. In the Democratic Republic Guatemala client Catarina Yolanda Yac de Leon has and she is able to hire employees. of Congo alone, FINCA clients, who had just 300 done all her life. She says her proudest achievement is that, instead savings accounts in 2009, have opened more than Born without her right arm, Catarina grew up of being “good for nothing,” she now is able to handle 128,000 accounts and saved more than $10 million being teased and taunted by other children. Her dis- all aspects of production in her business.

18 | www.FINCA.org www.FINCA.org | 19 20 | www.FINCA.org Our best year ever! We took the lead

www.FINCA.org | 21 WeWee servedtookk andth protected e lead

ince its very beginnings, FINCA has taken a ■ ethical staff behavior food. When her father died, Febby was shipped off to leadership stance on making sure that our ■ mechanisms for redress of grievances live with her mother who sent her to live with relatives clients’ best interests are at the forefront of ■ privacy of client data whom she says mistreated her, so much so that, one every decision we make about the financial Underscoring FINCA’s commitment, President and day, she went to school and never went back. servicesS we provide. Being a standard bearer in the CEO Rupert Scofield serves as a founding member of Febby returned to her mother; however she industry, taking the lead in helping establish principles the Smart Campaign Steering Committee. couldn’t pay for her schooling, so she dropped out of for the protection of microfinance clients, and pio- In 2011, Rupert helped establish the Microfinance school. Five years later, Febby joined a government- neering client assessment methodologies to track our CEO Working Group (MCWG) and serves as its co-chair. sponsored netball team that rewarded the girls with clients’ business and socio-economic well-being has The initiative’s goal is to enable the microfinance in- cash for wining matches. Febby knew this was a way been at the core of all we do. dustry to achieve its full potential of bringing financial to help her mother, so she asserted herself as a team And 2011 was no exception. FINCA continues to and related services to those who have traditionally leader and, whenever they won a game, Febby gave be at the forefront of developing industry-wide client been excluded. the reward to her mother. protections principles to ensure that all microfinance The MCWG’s initial commitment is to promote After Febby married, her husband paid for a tailor- institutions (MFIs) worldwide do business in a socially and support three initiatives already underway in ing course, the skills from which she has turned into a responsible manner that puts clients’ best interests the industry: The Smart Campaign; MicroFinance successful business. To grow her business, Febby first. FINCA was a founding member of an industry Transparency, an organization that promotes transpar- joined the Twaafwana Village Banking Group, and with coalition that developed The Smart Campaign, which ent pricing in the microfinance industry; and The her first loan of $200, she invested in more fabrics, and has been endorsed by 2,000 global MFIs, support Social Performance Task Force, a participatory effort put some of her profits into a savings account. She organizations, investors and individuals. of hundreds of industry stakeholders developing plans to purchase an industrial sewing machine, and The campaign is an unprecedented effort to make common tools for measuring social performance and hire another seamstress. client protection part of the DNA of microfinance. mission fulfillment. Febby encourages her fellow group members to not These pro-client codes of conduct and practices Being a leader can happen in any setting, but it only think about what they can do today, but about include seven principles: often takes life’s hardships to expose real leaders. how they can make a better future for their families. ■ appropriate product design and delivery From the very beginning, FINCA Zambia client Febby “I see women who had nothing and are now able ■ avoidance of over-indebtedness Daka was shuffled between family members, first living to borrow money from FINCA and do something with ■ transparent and responsible pricing with her father and his wife, a woman who resented their lives. FINCA is a good financial institution that ■ appropriate collections practices having to care for her, and often refused to give her really has a heart for women.”

22 | www.FINCA.org www.FINCA.org | 23 WeWee madetook ka differenceth e lead

n 2011, even in the midst of a soft economy, our government, provided more than $330,000 in in which she shares why she, personally, supports dedicated supporters—old and new—opened technical assistance support for our Uganda and FINCA’s work. FINCA Goodwill Envoy Zoe Saldana their hearts and their financial resources to help Zambia Subsidiaries also filmed a Lend A Hand video message, and was us reach more people than ever, and spending In-kind goods and services of more than $2 million featured as an In Style Magazine Shining Star for her countlessI hours in service to those who have the last were generously provided to FINCA from partners such work on behalf of FINCA. among us. as Microsoft and Freshfields Bruckhaus Deringer LLP. The team also led FINCA’s research & development The New Business Development Team mobilized Thanks to the generous contribution from Credit and new business initiatives, providing critical sup- more than $25.5 million in donations and grants in Suisse of more than $800,000, FINCA continues to port to our innovative Social Performance Initiative. support of Subsidiaries and new, innovative initia- build on groundwork laid through the Global Training They are also embarking on a new initiative—FINCA tives that will lead to more, and better, outcomes for and Development Academy Initiative. This initiative Plus—that seeks to identify and develop non-financial our clients. aims to create an in-house training institution to services and social enterprises designed to improve Some highlights include: systematically deliver high quality training to as many the lives of our clients, especially those living on less USDA Food For Progress support of Haiti, which as 1,000 existing and prospective mid-level managers than $1.25 per day. In addition, the team is spearhead- brought in over $6,000,000 in funding that will between 2011 and 2014. ing the effort to define the attributes that differentiate provide financial services to thousands of small-scale In June, FINCA launched Lend A Hand, an exciting FINCA from other microfinance institutions in what farmers and other microentrepreneurs in one of the new way for donors to select the micro-entrepreneur are becoming more competitive markets. poorest and least developed countries in the world. they want to sponsor, then use our secure, online And topping off a great year, President and CEO A $500,000, no-interest loan from the Whole Planet donation tool to make their contribution. Donations Rupert Scofield’s bookThe Social Entrepreneur’s Foundation which will assist FINCA DRC in opening a are sent to local FINCA programs, where our on-the- Handbook: How to Start, Build and Run a Business that new remote branch supporting more than 4,700 new ground staff provides the loans to borrowers. Once Improves the World, was published in April. The book Village Banking clients, expanding services deeper the borrowers pay back their loans, these donations creates a platform for FINCA to engage more fully in into rural communities in Eastern Congo. become part of the larger pool of local loan capital the larger conversation about what it’s taken to grow $400,000 in technical assistance grants from the available to other clients. from an idea scribbled on a legal pad in 1984 to one European Bank for Reconstruction and Development Also lending their hands in support of FINCA’s of the world’s premier microfinancial services provid- (EBRD) for Kyrgyzstan, Russia, Armenia and Georgia. poverty alleviation work in 2011 were FINCA’s ers serving millions of clients and their families for The Regional MSME Investment Fund for Sub- Ambassador of Hope Natalie Portman, who filmed more than a quarter century. Saharan Africa (REGMIFA) and the Agribusiness two videos—one in support of Lend A Hand which Initiative Trust, a fund established by the Danish was featured on Access Hollywood!, and the other

24 | www.FINCA.org Highlights from 2011 include, clockwise from right: President and CEO Rupert Scofield releasing a book chronicling FINCA’s journey to success; Goodwill Envoy Zoe Saldana and FINCA being featured in the December In Style Magazine Shining Stars special issue; Board Chair Bob Hatch and Rupert signing the final papers that established FINCA Microfinance Holdings, a first-of-its-kind, socially responsible investment partnership for microfinance; and FINCA launching Lend A Hand, a peer-to-peer donation program featured on national television with Ambassador of Hope Natalie Portman.

www.FINCA.org | 25 A Record Yeeaof rEfficient Growth

Program Services 93% General & Administrative 5% INCA rebounded from the global economic Fundraising 2% downturn by setting a new record for our

loan portfolio which made it possible for Program Services 94% us to lend more than $1 billion to clients General & Administrative 4% acrossF our 21-Subsidiaries. Percentages Fundraising 2% FINCA classifies expenses in three categories: for2010 program services, general & administrative and fundraising. In fiscal year 2011, FINCA spent $158.6 million on program services to benefit our clients, Percentages an amount that represented 94 percent of our total expenses for fiscal year 2011 of $168.3 million. for 2011 General and Administrative expenses comprised $6.6 million (4 percent) and fundraising $3 million (2 percent), respectively, of our total expenses for fiscal year 2011.

FINCA International’s auditors BDO USA, LLP have expressed an unqualified opinion on our 2010 December 31, 2011 consolidated financial state- Program Services $ 133,080,007 93% ments. Our complete audited financial statements General & Administrative $ 6,467,487 5% are available at FINCA’s website, www.FINCA.org. Fundraising $ 3,484,391 2% $ 143,031,885 100% 2011 Program Services $ 158,551,577 94% General & Administrative $ 6,681,388 4% Fundraising $ 3,080,611 2% $ 168,313,576 100%

26 | www.FINCA.org FINCA International, Inc. Consolidated Balance Sheets

December 31, 2011 and 2010 2011 2010 Assets Cash and cash equivalents $ 127,082,074 $ 38,886,378 Restricted cash and cash equivalents 32,091,924 31,870,939 Available for sale financial assets 13,484,768 8,996,782 Financial assets at fair value through profit and loss 2,534,435 3,172,811 Loans receivable, net 505,222,459 380,264,304 Grants receivable, net 2,397,797 634,971 Other receivables, prepaid and other assets 10,526,075 7,771,845 Property and equipment, net 16,544,918 15,198,052 Intangible assets, net 6,525,397 5,787,633 Deferred tax asset 3,358,270 3,441,915

Total assets $ 719,768,117 $ 496,025,630

Liabilities Accounts payable and other accrued liabilities $ 23,562,319 $ 18,472,563 Client deposits 40, 723,414 30,791,726 Notes payable 385,370,249 275,343,016 Subordinated debt 21,327,558 21,616,568 Deferred revenue 11,191,784 13,621,715 Employee benefit 4,129,109 3,923,649 Current income tax liability 3,265,804 1,512,581 Deferred tax liabilities 542,751 274,024

Total liabilities 490,112,988 365,555,842

Equity Reserves 13,907,134 9,913,487 Retained earnings 160,710,208 127,542,266 Currency translation reserve (11,564,641) (6,985,965)

Equity attributable to owners of the parent company 163,052,701 130,469,788

Non-controlling interest 66,602,428

Total equity 229,655,129 130,469,788

Total equity and liabilities $ 719,768,117 $ 469,025,630

www.FINCA.org | 27 FINCA International,FINCA Inc. International, Inc. ConsolidatedConsolidated Statements Statements of ofIncome Income

December 31, 2011 and 2010 2011 2010 December 31, 2011 and 2010 2011 2010

Interest income Interest income $ 221,944,299 $ 221,944,299 $163,277,485 $163,277,485 Interest expense (37,436,880) (27,207,911) Interest expense (37,436,880) (27,207,911) Net interest income before provision for Net interest income before provisionimpairment for impairment losses onlosses loans on loans 184,507,419 184,507,419 136,069,574 136,069,574 Impairment losses on loans (6,484,057) (5,724,041) Impairment losses on loans (6,484,057) (5,724,041) Net interest income 178,023,362 130,345,533 Net interest income 178,023,362 Other operating income 8,587,432 6,185,318 130,345,533 Net operating income 186,610,794 136,530,851 Other operating income 8,587,432 6,185,318 Personnel expenses (94,597,804) (81,459,720) Net operating income 186,610,794 Other operating expenses (67,125,010) (55,426,075) 136,530,851 Depreciation and amortization (6,590,762) (6,146,090)

Total expenses Personnel expenses (168,313,576) (94,597,804) (81,459,720) (143,031,885) Other operating expenses (67,125,010) (55,426,075) Income (loss) before other income (expenses)Depreciation and amortization 18,297,218 (6,590,762) (6,146,090)(6,501,034) Total expenses (168,313,576) (143,031,885) Other income (expenses): Grants Income (loss) before other income (expenses 8,855,071 18,297,218 (6,501,034)7,434,765 Donations 16,151,896 13,893,771 Foreign exchange losses Other income (expenses): (252,522) (2,487,872) Non-operating income Grants 628,853 8,855,071 7,434,7652,354,929 Donations 16,151,896 13,893,771 Income before income tax Foreign exchange losses 43,680,516 (252,522) (2,487,872)14,694,559 Non-operating income 628,853 2,354,929 Income tax expense (9,730,217) (4,667,192) Income before income tax 43,680,516 Profit for the year $ 33,950,299 $ 10,027,367 14,694,559

Profit for the year attributable to: Income tax expense (9,730,217) (4,667,192) Owners of the parent $ 33,282,648 $ 10,027,367 Profit for the year $ 33,950,299 $ 10,027,367 Non-controlling interest 667,651 —

$ 33,950,299 $ 10,027,367

28 | www.FINCA.org FINCA International, Inc. Consolidated Statements of Cash Flows

December 31, 2011 and 2010 2011 2010 Cash flows from operating activities Profit for the year $ 33,950,299 $ 10,027,637 Adjustments to reconcile profit for the year to net cash used in operating activities: Depreciation and amortization 6,590,762 6,146,090 Impairment losses on loans 6,484,057 5,724,041 Loss on disposals of property and equipment and intangible assets 1,549,923 3,600,143 Interest income (221,944,299) (163,277,485) Interest expense 37,436,880 27,207,911 Income tax expense 9,730,217 4,667,192 Foreign exchange losses 252, 522 2,487,872 Changes in deferred tax assets and liabilities 352,372 (1,250,785) Benefit plan fair value adjustment 67,971 (1,124,235) Tax on intercompany dividends (418,311) (125,947,607) (105,791,889) Change in working capital: Change in loans receivable (131,105,022) (68,780,136) Change in grants receivable (1,762,826) 2,546,417 Change in other receivables, prepaid and other assets (2,754,230) 1,150,214 Change in accounts payable and other accrued liabilities 5,089,756 (1,868,869) Change in client deposits 9,931,689 5,041,821 Change in deferred revenue (2,429,931) (3,406,147) Change in current income tax liability 1,753,223 193,662 Change in employee benefits 137,489 1,463,143 (121,139,852) (63,659,895) (247,087,459) (169,451,784) Interest received 214,012,705 158,239,882 Interest paid (33,378,096) (28,371,635) Income taxes paid (9,099,447) (2,137,125) Net cash used in operating activities (75,552,297) (41,720,662) Cash flows from investing activities Purchase of available for sale financial assets (4,070,595) 2,057,694 Purchase of property and equipment (8,502,145) (7,128,829) Purchase of intangible assets (2,342,532) (2,654,821) Net cash used in investing activities (14,915,263) (7,725,956)

Cash flows from financing activities Issue of ordinary shares by Subsidiary 70,300,000 Proceeds from lenders 176,867,416 120,934,200 Repayment of loans and borrowing to lenders (66,798,038) 95,877,020 Net cash provided by financing activities 180,369,378 25,057,180

Net increase (decrease) in cash and cash equivalents 89,901,818 (24,389,438) Cash and cash equivalents Beginning of year 38,886,378 66,226,540 Exchange losses on cash and cash equivalents (1,706,122) (2,950,724)

Cash and cash equivalents, end of year $ 127,082,074 $ 38,886,378

The notes form an integral part of these consolidated financial statements. www.FINCA.org | 29 Global Boards of

FINCA International Rupert Scofield Volker Renner Jeff Flowers President and CEO Vice President and Vice President and Regional Executive Committee Chief Operating Officer Director for Eurasia Robert W. Hatch, Chairman Chairman and CEO, Cereal Ingredients, Inc. Rupert W. Scofield, Assistant Secretary President and CEO, FINCA International Richard M. Williamson, Assistant Treasurer Managing Director, Alvarez & Marsal John K. Hatch, Secretary and Historian, Founder, FINCA International Mike Gama-Lobo Yuriy Shulhan Steven McGuire Vice President and Regional Vice President and Regional Vice President and Chief Director for Africa Director for Latin America Financial Officer Directors Carlos Camacho, Sr., Entrepreneur, Director, FINCA Ecuador John Elkins, President, International Regions, First Data Jo Ann Field, Community Activist Shawn Hassel, Managing Director, Alvarez & Marsal Soledad Hurst Harold D. Jastram, Esq., Oppenheimer, Wolff & Donnelly (ret.) FINCA International Team Management Executive Gwen Andreotti Donald Crane Braulio L. Oliveira Paul LeFort, CIO, United Health Group (ret.) Vice President and Director of Vice President Vice President and Chief Knowledge Management and General Counsel Information Officer Agrina Mussa, Managing Director, Classic Design Limited, Director, and Administration FINCA Malawi James Semakadde, Lecturer, Makerere University Business School, Director, FINCA Uganda Rita E. Spillman, President and CEO, SH Productions, Inc. David Weisman, President and CEO, InSite Wireless Group, LLC Her Majesty Queen Rania Al-Abdullah of Jordan, Director Emeritus

Soledad Gompf Jim Lemke Sona Gandhi Chikako Kuno Vice President and Director of Vice President and Director Deputy to the President Director of Capital Markets New Business Development of Human and Resources and CEO

30 | www.FINCA.org Directors and Advisory BoardsFINCA Advisory Board FINCA Canada Advisory Board Susan Ainsworth, President, Ainsworth Associates Katinka Barysch, Deputy Director, Board of Directors Margaret S. Blakey, Principal, Canopy Investment Advisors LLC Centre for European Reform Rupert W. Scofield, President, FINCA Canada Stuart Bray, Chairman, Save China’s Tigers, Cindy Chupack, Screenwriter, currently a Writer/ President and CEO, FINCA International Co-Executive Producer of Modern Family Conservation Finance International Jacquie Green, Visual Artist Eugene P. Ericksen, Ph.D., Professor Emeritus, Temple University Clare Delmar, Social Entrepreneur Gwen Andreotti, Vice President and Director of Ivor Graham, Tax Consultant Jo Ann Field, Community Activist Knowledge Management and Administration, Angéline Fournier, President, Maeva Investments, Inc. FINCA International George Hall, Consultant Robert Graham, Strategic Financial, Soledad Gompf, Vice President for New Business Jennifer Harris, Founder and Managing Director, The Private Consulting Group Development, FINCA International Board Intelligence Hon. Cheryl F. Halpern Michael Green, President and CEO, ObjectSharp Christine Renier, Corporate Marketing Consultant Corporation John Hatch, Jr., Vice President, Global Securities Solutions, Alex Ritchie, Consultant Bank of America Merrill Lynch Linda Wolfond, Philanthropist David Seymour, Media and Political Consultant Kristin G. Hatch, Information Consultant Christina Tessaro, Founder and Director, Advisory Board Nabeeha Mujeeb Kazi, Managing Director, Tessaro & Associates Karen Basian, Principal, Firefly Strategy Capital Inc. Humanitas Global Development Debbie Gamble, President, Gamble Consulting Aleen Keshishian, Partner, Brillstein Entertainment Partners FINCA Microfinance Holdings, LLC Jeffrey Stinchcombe, Partner, HealthSource Plus Charles Loveless, Director of Legislation, American Federation Directors of State, County & Municipal Employees Robert W. Hatch, Chairman and CEO, Rebecca Minkoff, REBECCAMINKOFF/BENMINKOFF FINCA United Kingdom Cereal Ingredients, Inc. Betsy Ross, Owner, Betsy Boutique Rupert W. Scofield, President and CEO, FINCA International Directors Rosalie Swedlin, Literary Manager and Producer, Richard M. Williamson, Managing Director, Anonymous Content Rupert W. Scofield, President and CEO, FINCA UK Alvarez & Marsal President and CEO, FINCA International Colston Young David Weisman, President and CEO, InSite Wireless Jack Elkins, Retired Businessman Mary Ann Zirelli, Senior Director, Marketing, Oracle Group, LLC Daniela Menzky, Chief Executive, Auto Clubs Matthias Adler, Principal Financial Sector Economist, Ambassador of Hope International KfW Bankengruppe Natalie Portman Janet Pope, Director of Group Chief Executive’s Office Michael Barth, Senior Advisor, Business Development, Goodwill Envoy at Lloyds Banking Group Darby Overseas Investments, Ltd. Zoe Saldana Charles Trevail, CEO, Promise Corporation

www.FINCA.org | 31 FINCAInternational Staff Executive Tracie Hill, Senior Grants Accountant Vanessa Elmer, Department Olga Trusova Alex B. Padilla Chumacero Rupert W. Scofield, President & Neema Hussein, Staff Accountant Coordinator—Internal Audit Global Recruiting Manager Director of Regional Information Chief Executive Officer Services-Latin America Aida Idrizi, Controller—Headquarters Galina Grineva, Regional Internal Yidong Zhai Rashid M. Galadanci Audit Manager —Eurasia Senior Staff Accountant- Payroll Ronald E. Predmore Enna Blanca Ijjasz Executive Initiatives Manager Enterprise Database Architect Manager Grant—Accounting Nargis Podchoeva Information Services Sona Gandhi, Deputy to the President Regional Internal Audit Stephanie Salazar Ali Izadpanah, Assistant Director Braulio Oliveira, Vice President and and Chief Executive Officer Coordinator —Eurasia Core Banking Project Manager of Treasury Services Chief Information Officer Rocael Alvarez Garcia Claudio Schuster Vasiliy Smirnov Andre L. Kravchenko Rita Apell, Director of Regional Regional Transformation Deputy Chief Auditor Enterprise Data Architect Senior Investment Advisor Information Services—Africa Manager—Latin America Irena Todortcheva, Director of Chikako Kuno Human Resources Suresh Bhatt, Core Banking Isabel Insua-Garcia, Senior Executive Corporate Information Technology Director of Capital Markets James Lemke Technology Integration Specialist Assistant to the President and CEO Radoil Matov Vice President, Human Resources Maksym Burenko Melvin Ventura, HQ Project Manager Kristen Rankin, Executive Associate Senior Investment Officer Esther Akafia, Regional Human Director of Regional Information Satish Yadav Core Banking Services—Eurasia Rachel Rose, Executive Associate Leonardo Polit, Director of Resources Director—Africa Technology Integration Specialist Rebecca Sawyer, Senior Manager, Global Risk Management Lala Benryane, Onboarding and Boris Filatov, Enterprise Data In Chul Yoon, System Administrator Analyst/Business Analyst Executive Advocacy Elizabeth Rojas, Staff Accountant Employment Specialist Ravi Shekar Hariharan Knowledge Management Jason Ruiz, Financial Analyst Ella Beavers Finance FINCA Development Academy Global Solutions Architect— & Administration Dane Steven McGuire, Vice President Taylor Sabo, Financial Analyst (FDA) Implementation Manager Core Banking Technology Gwen Andreotti and Chief Financial Officer Scott Tindall Matthew Gomez, Employment David C. Harrington, Global Vice President, Knowledge Ronald Aizer, Director of Financial Director of Treasury Services Specialist Payroll/Contracts Technology Program Manager Management and Administration Planning & Analysis Bryan Vasek, CMG Analyst Thomas Halleran, Recruiter Lee Imrey Shelby Booth, Director of Information Protection Office & Administration Coordinator Timothy Childress Emily C. Yee Julie Houser Director and Global Controller Manager, Financial Planning Talent Initiatives Manager Partha Kakati, Core Banking Elisabeth Richters Technology Systems Analyst Executive Associate Odilia Cohen Kasia Hutoron, Director of Human Senior Investment Advisor Global Corporate Maria Elena Koller Internal Audit Resources Services and Operations Kimberly Smithman, Receptionist Emily L. Gerry, Enterprise Risk Senior Executive Assistant Pedro Fabiano, Global Chief Auditor Marc Locco Legal Management Analyst Senior Compensation Analyst Gigi Matiashvili, Enterprise Core Muhammed Siddique Ahmed Donald Crane Nadezhda Gordeeva Banking Program Manager Regional Internal Audit Britt Macko, Executive Associate Vice President & General Counsel Senior Financial Reporting & Meskae T. Mulat, Technical Analyst Manager—Africa Consolidations Manager Claudia Palacios Stephanie Bagot, Corporate & Sergey Novikov Alexis Bell, Forensic Audit Manager Human Resources Manager International Attorney Maurizio Grassia Regional Core Banking Program Senior Financial Analyst Manager—Eurasia Jennifer Gerstner, Paralegal

32 | www.FINCA.org Louisa Tomar Bob Price Elijah Mulwa, Regional Training Lilian Guzun, Regional Internal Elisa Renata Arauz-DeStefano Legal Department Coordinator Director of Direct Marketing Manager—Africa Control Manager—Eurasia Operations Analyst—Latin America Carmela Ulloa Sonali Rohatgi, Senior Manager, Philip Mulwa, Regional Savings and Hakob Khotsanyan Julia Coppinger International Corporate Attorney New Business Initiatives Channel Manager—Africa Regional Credit Manager—Eurasia Executive Assistant—Latin America Maria V. Vilela Jennifer Schmidt, Senior Manager, Fausta Nakaggwa, Administrative Jana Kadian, Regional Operations Chief Executive Officers— Senior Corporate Counsel Restricted Giving Assistant—Africa Hub Manager—Latin America Eurasia Subsidiaries Manuela Muller, Regional Internal Militza Simonds Richard Ndahiro, Regional Marketing Yervand Barseghyan New Business Development Donor Services Manager Control Manager—Latin America & Research Specialist—Africa Chief Executive Officer—Armenia Soledad Gompf, Vice President, New Katherine Torrington, Research & Ibodullo Nuridinov, Regional Internal Milan Patel, Regional Research Business Development Makhmud Saidakhmatov Customer Relationship Manager Specialist—Latin America Control Manager—Africa Hub Chief Executive Officer—Kyrgyzstan Ana Otavila Alvarez Anita Yankova Lisa Miller, Planning and Financial Communications Associate Keith Sandbloom Digital Marketing Manager Chief Executive Officers— Analyst—Latin America Chief Executive Officer—Kosovo Marianne Benet Africa Subsidiaries Mabel Valdivia Senior Manager, Major Donors Edward J. Greenwood Manish Sane Senior Manager, Major Donors Chief Executive Officers— and Small Foundations Chief Executive Officer— Chief Executive Officer—Azerbaijan and Foundations Latin America Subsidiaries Claire Breslin Nieto, Executive Democratic Republic of Congo Jerrold Smelcer Luis Camacho Assistant to the Vice President of Operations Thomas Kocsis Chief Executive Officer—Tajikistan Chief Executive Officer—Mexico New Business Development Volker Renner, Vice President Chief Executive Officer—Tanzania Timothy L. Tarrant Kim Guenkel Kristina Brzezinski, Senior Donor & Chief Operations Officer Thomas Lendzian Chief Executive Officer—Russia Chief Executive Officer—Haiti Information Manager Stefan Queck, Global Savings and Chief Executive Officer—Zambia Vusal Verdiyev Klaus Hesse Leslie Enright, Senior Manager, Banking Services Manager Ponsiano Ndyabahika Chief Executive Officer—Georgia Chief Executive Officer—Ecuador New Business Development Joy Souligny, Operations Analyst Chief Executive Officer—Malawi Chief Executive Officers— Juan More Phillip Galenkamp, Senior Manager, Julius Omoding Greater Middle East Chief Executive Officer—Honduras New Business Development Africa Hub Chief Executive Officer—Uganda Subsidiaries Hans Nunez Mike Gama-Lobo, Regional Director Scott Graham, Director of Research Zarlasht Wardak, Chief Executive Chief Executive Officer—Nicaragua & New Business Initiatives for Africa & Vice President Eurasia Hub Officer—Afghanistan Jov O’Brien Alison Boess, Regional Financial Jeffrey A. Flowers, Regional Director Paul Hamlin, Senior Manager, John Yancura Chief Executive Officer—El Salvador Customer Research Analyst—Africa Hub for Eurasia & Vice President Chief Executive Officer—Jordan Elmer Zepeda-Lopez Diane Jones Godfrey Byekwaso, Regional Senior Nazim Aliyev, Regional Training Chief Executive Officer—Guatemala Senior Manager, Marketing Finance Manager—Africa Hub Manager—Eurasia Latin America Hub Communications & Public Relations Evelyn Ezaru Zolikha Askarzoi, Regional Research Yuriy Shulhan, Regional Director for Patrick McCormick Office Attendant—Africa Hub Specialist—Eurasia Latin America & Vice President Direct Marketing Manager Helen Lin, Planning & Financial Ekaterina Dudko Sergio Alguacil-Mallo, Regional Analyst—Africa Hub Finance Manager—Eurasia Hub Training Manager—Latin America

www.FINCA.org | 33 More than $25,000 Erle G. Holm Anonymous (2) Soledad and Robert Hurst J. Keith Behner and Catherine M. Stiefel The InMaat Foundation Estate of William J. Dant J & AR Foundation Terry and John Elkins David A. Kiefer Mr. and Mrs. Eugene P. Ericksen Mr. and Mrs. Mark Lake Hershey Family Foundation Allen and Marion Lambert Fund David P. Hill Leibowitz and Greenway Family Charitable Foundation Estate of Ethel B. Hoefler Estate of Steven B. Levin Estate of Constance Holcombe Margaret Little Kaimas Foundation Nellie L. McCabe Mr. and Mrs. Paul F. LeFort Dr. Diana Moore Mr. and Mrs. David A. Levine Mr. and Mrs. Archie M. Palmer, Jr. Estate of Helen Lieber Frederick H. Prince Testamentary Trust Mr. and Mrs. Charles Liebman Norman Ray and Helen Yamada The Osprey Foundation of Maryland Joan P. Richardson Ostara Foundation Ruth E. Rollins Estate of H. V. Persson FINCA’s 2011 Estate of George R. Seiler Mr. and Mrs. Raymond Riva Rosalie Swedlin and Robert Cort The Skolnick Foundation Tomchin Family Charitable Foundation Generous Supporters Mr. and Mrs. Cyrus W. Spurlino Carol Twitchell Jacqui Michel and David E. Weisman Two Commandments Foundation Estate of Thomas W. Widney H. van Ameringen Foundation Th a nk you! Mr. and Mrs. Jack L. Witherow Mr. and Mrs. Joseph R. Williamson $10,000 - $24,999 Wolfond Family Lynn and Cary Yeh FINCA receivedd more than 125,000 contributions, investments and Anonymous (4) Colston E. Young Susan Ainsworth otherr financiall supportt between Januaryy 1 andd Decemberr 31, 2011. Zephyr Charitable Foundation, Inc. Cindy and Eric Arbanovella To alll who generouslyy supportt our efforts to provide a handd up, not Cameron and Jane Baird Foundation $5,000 - $9,999 Ray Benton Family Fund Anonymous (2) a handout, the Board off Directors, staffff off FINCA, andd ourr hundreds Claudio Caycedo Alpern Family Foundation, Inc. off thousands off clients worldwide offerr ourr heartfeltt gratitude. Mr. and Mrs. John W. Converse Aziz Ansari Estate of Barbara L. Curry James and Dorothy Baer Foundation Carol and Lloyd Darlington Due to space constraints, FINCA is not able to acknowledge all off our Blackie Foundation Emerald Foundation Constance Broz generous donors individually. In addition, while everyy effortt is made Jo Ann Field Zoe and William Baird Budinger Helen H. Ford Susan Okie Bush to ensure the accuracyy off this list, errors can sometimes occur. Iff you Virginia and Cameron Fowler Captiva Foundation believe an errorr orr omission has been made, please contactt us. D’Ette Fowlkes Neal Carson Mr. and Mrs. Linus Fuhrmann Cindy Chupack Paola Gianturco Clifford Foundation, Inc. Shawn Hassel Estate of Walter F. Courtis

34 | www.FINCA.org Emmanuel F. Crabbe Mary Mitsui Barbara and David Burns Rev. Edward McElduff L. Randall Weisberg Joyce and Larry Dare Elizabeth and John J. Monagle Anthony Cardenuto Clarinda and Jonathan Merripen David F. and Sara K. Weston Fund Estate of Joyce Ekman Davis Tertia Moore Patrice L. Comey J.T. Murphy Mr. and Mrs. David Weissner Jeffrey L. Dennis David Ong Renee Conforte Ann and William Naftel Nancy G. Whitney James Douglas Jennifer Price and Tony Hunter Deborah Cowley and Mark Dexter Neskey Family Fund Karen and Stephen Wiel Charles Engelke Ronald J. Proesel and Nancy Ryan Proesel Carol A. Crotty Bonnie New Family Fund Angus Woodman Brian Etheridge Alvin S. Prusoff Charles E. and Charlotte T. Curry Xavier Nicolas Regina and Walter Wunsch Dr. Barbara M. Falk, Trustee Linda Raiss Foundation Marcia Nordgren Ruth B. Yeazell Lia and Guy Haskin Fernald Dorothy D. Ruff and George H. Ruff Jean Day Andrew B. Obert Zaitlin-Nienberg Family Fund Foundation Alina Fisch Michelle and Christopher Delong Lorraine O’Hara and Rupert W. Scofield Christopher F. Zurn and Nancy B. and Larry B. Fitzgerald Margaret and Contee Seely Katharine Dickson Gerald Oppenheimer Family Foundation Ms. Michelle Saunders J. Rene and Steven E. Sellen Candace and Bert Forbes Sarah M. Evans and John P. Bergren Janet and John H. Parker Ronald Shaw Corporations Audree V. Fowler Caroline L. Everts Paulson Charitable Foundation Treenie Sparling Akol Avukatlik Burosu Franklin Conklin Foundation William Ewing Foundation Rolf Paulson Frances W. Stevenson Barrday Rebecca G. Frederick and Evelyn R. Ferguson Roger Piper Trina J. Tjersland Virginia and Carl Stringer Broad Reach Communications Richard A. Fink Dolores A. and Melvin H. Raff Marianne Gabel and Donald Lateiner The Maureen Sullivan Memorial Fund Bristol-Myers Squibb Foundation* Frank W. Finsthwait William N. Raiford Kathleen Garfield Phyllis B. Taylor Chartered Alternative Investment Laurel E. Friedman Rudy & Alice Ramsey Foundation Analyst Association Gesher Family Foundation Estate of Norman W. Terry Steven Gerber Margaret Ratheau Citi Foundation Lynn Gordon and David E. Simon Thendara Foundation Bob and Eileen Gilman Family Foundation Day Ravenscroft Cleary Gottlieb Betty Grant Maria S. Tracy Lucille Goodwyne and Richard A. Lundy Edward Rawson Covington & Burling LLP Pamela Greer Barbara Van Alstine Robert A. Granieri Reimer Family Foundation Creative Artists Agency Kimberly Halley Melanie and Adam Waldman Mary and John Grant Foundation Susan Rikalo Credit Suisse Nancy and Robert W. Hatch John W. Watts Jill Greenberg Hannes Richter and Synthia Scofield ERATE Miriam R. and Frank R. Hellinger Thomas L. Wheeler Marcella Grendler Grace Riggs Fund First Data Sue and Ralph Hoevelman Kristen and Richard Williamson Cheryl and Fred Halpern Laura M. Robinson Freshfields Bruckhaus Deringer LLP Carol Hollworth John P. Wood Hamond Family Foundation Dr. Ralph Scoville Google Thomas J. Hooley Fund for Social Justice Kristin G. Hatch Brenda B. Senturia of The Saint Paul Foundation $2,500 - $4,999 Henri Bendel Judith Hays Diane Horn Janet and Gregory Abels Ellen L. Simons Fund IBM* Honeyfund.com Inc. Mark X. Jacobs and Daniel P. Barash Jimmy Adams Mark P. Smith Mayer Brown LLP Jessie Huffman Kelly and Robert Emlen Jones Susan W. Almy Tana Sommer-Belin Meritage Portfolio Management, Inc. Human Rights Project Inc. Nina G. Kagiwada Velma P. Anderson Charitable Lead Trust Harold Spaeth MetLife Melva and Harold Jastram Carol Tyrrell Kyle Foundation Anonymous (5) Robert M. Sprague Microsoft Robert Jesperson Berthe K. and Edward H. Ladd Rev. Linda H. Anton Leigh E. Stamets Promise Corporation Estate of Ellen Kagan Torben S. Lorenzen Ruth Arnhold Endowment Fund Catherine and William Tschumy RBC Foundation Kalan Foundation Beverley Martin Mr. and Mrs. Russell E. Atha, III Chris and Mrs. Valerie Valdiviez Queen’s Executive MBA Lorraine Mastropieri Kent P. Bach Margaret L. Langley Lee Van Divort Tessaro Associates Carol McCallum and Susan E. Sadowski Dr. Julia Bailey Tom Lehrer Mark Verlinden Total Security Management Employee Giving Program Brian T. McGeer Jerry Bloch Margaret Lewis Elizabeth Walgren-Grewe Visa Robert & Joyce Menschel Family John Bloom Ellen Lohff Estate of Susan Grant Wallace Foundation Cynthia Bradley Adelma Taylor LoPrest Alisha and Lance Waller Whole Planet Foundation Nolan Miller Dr. and Mrs. Edward Britain Alexandra J. MacCracken Marcia D. Weber and James B. Flaws World Bank Community Connections Fund* Malcolm R. Minasian Nancy and Steven Bruckner Jon McAlister Stanley A. Weglarski * Employee matching gifts

www.FINCA.org | 35 Foundations Kreditanstalt für Wiederaufbau (KfW) Private Voluntary Organizations Legacy Society Luzetta and Delano Newkirk Clinton Bush Haiti Fund Microfinance Enhancement Facility $1,000 and above Daniel Altilio Marsha and William Nickels Ford Foundation Microfinance Growth Facility (MigroF) Anonymous Terry Andrews Sandra Perkins and Jeffrey Ochsner Bill & Melinda Gates Foundation MicroPlace Cedars Unitarian Universalist Church Belinda K. Barington Vivienne E. Perkins-McLean The Kristie Charitable Foundation Minlam (Bainbridge Island, WA) Marilyn and Richard Batchelder, Sr. Katie and Michael Place Joyce and Donald Rumsfeld Foundation Netherlands Development Finance Christ United Methodist Church Annemarie S. Bein William N. Raiford Company (FMO) (Memphis, TN) and Empowering May and Stanley Smith Charitable Trust Zambia Judith Billings Anna Louise Reynolds Oikocredit Rick Browne Sara Rothmuller Government and COE Lending Group Regional MSME Fund for Sub-Saharan Sally and Leonard Burdock Ellen Russak Multilateral Institutions Africa (REGMIFA) Alyson Dehmcke and Friends Kenneth Burrows Jeannette Safran Agribusiness Initiative Trust responsAbility Dale Finkenbiner and Fusion Silver James Caffery Lynne Schreiber Regional MSME Investment Fund Sisters of St. Dominic First Congregational Church of Old Lyme (Old Lyme, CT) Diane Cavenee Lorraine O’Hara and Rupert W. Scofield for Sub-Saharan Africa S.A. Société Générale de Banque Jordanie First Unitarian Church of Providence Melanie Chadwick John Shugars United Nations Capital St. Joseph Roman Catholic (Providence, RI) Development Fund Congregation Janice and Thomas Chamberlin Rhea Singsen United States Department Symbiotics First Unitarian Congregational Society Heather Chisholm-Chait Nancy D. Solomon of Agriculture (USDA) in Brooklyn (Brooklyn Heights, NY) Triodos Barbara Crook Janet D. Spector First United Methodist Church Don Dietz Faye and Robert Spencer Investment Partners Triple Jump (Northville, MI) Susan E. Dodd Bill and Susie Thorness ALTERFIN World Bank Kansas City Women Go Global Nancie and Mauritz Erhard Roger Tiemann ArmSwissBank Richard Kemp and Friends Lend A Hand Joen Fagan Thomas E. Weakley Banamex Kendall Gerdes and Mile High We gratefully acknowledge the Lucy F. Fairbank Priscilla and Rodney E. Wilson Banco Atlantida individuals who sponsored clients Friends of FINCA Jo Ann Field Colston E. Young Banco Covello through FINCA Lend A Hand, our online Pastoral Ministries at Brooksby Village Banco de America Central donation tool. Your gifts made a positive (Peabody, MA) Emily Garlin Jan Zlotnick impact in the lives of FINCA clients and People’s Church of East Lansing Arlee Geary Banco Pacifico their families in Afghanistan, El Salvador, (East Lansing, MI) Blue Orchard Haiti and Zambia. Jack Goggin Calvert Foundation Reformed Mennonite Church of Lucille Goodwyne and Richard A. Lundy Cumberland County (Newville, PA) Centenary Bank MicroPlace Dita K. Hatch St. Peter’s Church (Port Royal, VA) Citibank We gratefully acknowledge the more Kristin G. Hatch than 1100 individuals and organizations Unitarian Universalist Fellowship BCO Nancy and Robert W. Hatch Credit Suisse who have invested in FINCA through (Croton-on-Hudson, NY) MicroPlace, a unique website that Marian and Robert Hatch, Jr. Deutsche Bank AG United Methodist Church—Bemidji permits FINCA to aggregate individual John Hoffman Developing World Markets Methodist Women (Bemidji, MN) investments and lend them to FINCA’s Carol Hollworth EOLO Investments B.V. 21 Subsidiaries. United Way of Central New Mexico Katherine Hufnagel European Bank Reconstruction and United Way of the Bay Area Development Brian Hughes Women of the ELCA Christ Lutheran European Fund for Southeast Europe Church (Fairbanks, AK) Mona Jibril Jo Ann Field Marie Kellogg FINAFIM Sustainers’ Circle Marjorie Kemp FINCA Microfinance Fund B.V. FINCA gratefully acknowledges Christine Keyt members of our Sustainers’ Circle who French Development Agency Jeffrey M. Lalande donate to Village Banking every month Incofin through automatic contributions. We B.R. Marchand Inter-American Development Bank encourage you to consider this easy and C. Andrew Mepham International Finance Corporation efficient means to provide FINCA with Lisa Miller important and consistent support.

36 | www.FINCA.org So Many Ways to Change a Life!

As you read FINCA’s 2011 annual report, we hope you’ll take time to consider all of the powerful and convenient ways FINCA Team Pages povertyy alleviation work, and make a statement you can support FINCA’s work to provide hope and oppor- Use FINCA Team Pages to create off care about someone special in yourr life. your own personal webpage tunity for hundreds of thousands of hard-working micro- FINCA Lend a Hand and raise funds with your family This innovative new tool lets donors select the entrepreneurs throughout FINCA’s 21-country network. and friends! Our user-friendly microentrepreneur theyy want to sponsor, and system lets you personalize use our secure, online donation tool to make A Gift off Securities your team page, keep in two-way touch their contribution. Visit www.LendaHand. Consider a gift to FINCA off stocks, bonds or with team members, make secure online FINCA.org. mutual funds. Anyy securities you’ve owned donations and trackk progress toward your for twelve months or longer, whose value self-designated goal. Go to teams.FINCA.org Corporate Matching Gifts has increased, are subject to capital gains tax or teams.FINCAcanada.org Corporate matching gift programs are among when sold. Byy giving these securities to FINCA, Sponsor a Village Bank the best and simplest ways for FINCA support- you receive a charitable deduction for their Each year, we designate the Subsidiaries in ers to maximize the value off their personal , full fair market value and you avoid tax on the greatest need off loan capital for the Village and increase the impact off their gifts. Most capital gain. Bankk sponsorship program. This year’s programs match the charitable contributions The Sustainers’ Circle Subsidiaries include Afghanistan, El Salvador off employees, dollar for dollar, and some even The most cost effective—and easiest—wayy to and Zambia. Your $5,000 contribution will double or triple the amount! support a Village Bankk where it’s needed support FINCA. Simplyy determine a monthly Legacy Society contribution amount, provide us with credit most, providing loans to borrowers who FINCA’s Legacy Societyy provides an opportu- card or checking account information, and can experience—some for the first time— nityy to include a bequest to FINCA in your will. your account will be billed automatically. You the opportunityy to lift themselves and their A carefully-designed estate plan can provide can change the amount, or withdraw from the families out off poverty. significant estate tax relief, allow you to program, simplyy byy writing us. Honor and Memorial Gifts determine the distribution off your assets, and Making a gift in honor, or memory, off a loved let you express your values through continued one is a thoughtful way to support FINCA’s support off our work.

www.FINCA.org | 37 FINCA International 1101 14th Street NW 11th Floor Washington DC 20005 Phone: 202.682.1510 Fax: 202.682.1535 www.FINCA.org

FINCA Canada 4254 avenue Laval Montréal, QC H2W 2J5 Phone: 514-995-9471 www.FINCACanada.org

FINCA UK 31 Bath Road London W4 1LJ Phone + 44 (0) 208995 2299 www.FINCAUK.org