Sri Lanka’s oldest finance company, Alliance Finance Company PLC (AFC), has received the second tranche of $ 5 million from the Netherlands Entrepreneurial Development Bank (FMO) under a long-term finance facility from $ 10 million to expand its growing MSME business portfolio.

AFC secured this $ 10 million facility from Dutch entrepreneurial development bank FMO in mid-2021 and received the first tranche of $ 5 million on 07/01/2021 With an investment portfolio of $ 6.3 billion euros, FMO is one of the largest bilateral private sectors in Europe. development banks with investments in 85 countries. This round of funding is also an important development for the country’s MSME sector, which is considered to be the backbone of the economy.

Mr. Romani de Silva, Vice President and General Manager of AFC, said: “This is an important milestone for AFC’s business strategy focused on MSMEs and we are encouraged and excited by the partnership of FMO in our MSME plans. The AFC-FMO partnership to develop the MSME sector in the country confirms AFC’s growing international credibility. Last year, AFC became the first financial institution in South Asia certified for holistic sustainability in the banking and financial sector, governed by the EOSD International Council of Sustainability Standards for Value-Driven Financial Institutions (ICSSVDFI ). FMO is no stranger to AFC since it assisted AFC with a similar facility in 2018. The facility is for a 5-year term with a fixed interest rate, thus helping AFC to manage its asymmetry of assets and liabilities in the balance sheet. AFC, which easily receives such high-profile global funding, is proof of the international accreditation of our proven focus on sustainable funding, which in turn is part of our broader commitment to the Triple Bottom Line of People, of the planet and of profit.

In 2017, AFC became the first financial institution in Sri Lanka’s NBFI sector to commit to the UN Sustainable Development Goals (SDGs) and the Paris Climate Change Agreement when it signed the “Karlsruhe resolution”. In recent years, AFC has invested 3-4% of its profits each year in social and environmental sustainability initiatives despite an extremely difficult external environment. In its initiatives that benefit the environment and society, the AFC has pledged LKR 18 million for sustainable development initiatives in the 2020/21 financial year.

Despite a difficult environment with the covid 19 pandemic, AFC performed exceptionally well in fiscal year 2020/21 with commendable growth in PAT compared to the previous year. The Company has once again proven its resilience to external shocks and has achieved consistent performance in all key indicators reported in its latest quarterly financial statements published to the CSE. The company recorded robust growth of 13.8% in total assets exceeding 38 billion rupees. and declared an NPL of 7.12% well below the published industry averages while reporting a total capital ratio of 14.95% well above the regulatory minimum of 11%. Promising financial performance is the result of a well-articulated business strategy, good leadership and the integration of industry best practices.

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