ASA International Group plc January 2022 business update
Amsterdam, The Netherlands, 24 February 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 31 January 2022.
· Liquidity remains high with approximately USD 110m of unrestricted cash and cash equivalents across the Group.
· The pipeline of funding deals under negotiation totalled approximately USD 184m, down by USD 3m since December partly due to USD 19m of loans secured in January.
· With the exception of India and Myanmar, all other operating companies continued to achieve collection efficiency of more than 90% and 9 countries achieved more than 95%.
· India collections slightly improved to 76% from 74%, despite a lockdown in several districts of West Bengal in January. Collection efficiency, excluding instalments due from clients receiving the one-time loan restructuring offered by the Reserve Bank of India ('RBI'), increased to 101%.
· Collections in Myanmar remained at 78%, despite the partial lockdown imposed by the local government.
· The benchmark PAR>30 for the Group, including off-book loans and excluding loans overdue more than 365 days, improved to 6.4% from 7.3%, and PAR>90 improved to 4.0% from 4.6%.
· The Group's operating subsidiaries, excluding India, the Philippines and Myanmar, collectively have been able to maintain PAR>30 at 1.7%.
· Excluding all loans which have been overdue for more than 180 days and, as a result, have been fully provided for, PAR>30 slightly improved to 3.8% from 4.1%.
· Disbursements as percentage of collections exceeded 100% in one country. The decreasing percentages seen in India, Sri Lanka, Ghana, Nigeria, Sierra Leone, Rwanda and Zambia were primarily due to the seasonal slowdown of disbursements in January.
· With the number of clients stable at 2.4m (slightly lower than in December and 1.7% lower than in January 2021), and with disbursements as percentage of collections decreasing, Gross OLP decreased to USD 425m (1% lower than in December 2021 and 5% lower than in January 2021).
· The moratorium amount decreased to USD 26.2m, and is composed of the restructured loans of certain distressed clients in India as per the RBI guidelines. No other country operations granted moratoriums.
Health impact of COVID-19 on staff and clients
· Since March 2020, the number of staff members confirmed as infected by Covid-19 increased to 518 of over 12,800 staff, with two deaths. Confirmed infections amongst our 2.4m clients increased to 21,659 from 20,748 in the previous month, resulting in 690 deaths since the start of the pandemic. Of the 690 client deaths across the Group, 451 took place in Myanmar, with no deaths occurring in January 2022.
Funding
· Unrestricted cash and cash equivalents remained high at approximately USD 110m.
· The majority of the Company's USD 184m 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. The marginal drop in the funding pipeline was partially caused by the relatively large amount (USD 19m) of new loans secured from local and international lenders in January.
Collection efficiency until 31 January 2022(1, 2)
| Countries | Jul/21 | Aug/21 | Sep/21 | Oct/21 | Nov/21 | Dec/21 | Jan/22 |
|
| India | 58% | 60% | 64% | 70% | 69% | 74% | 76% |
|
| Pakistan | 99% | 99% | 99% | 99% | 99% | 99% | 99% |
|
| Sri Lanka | 76% | 80%(3) | Nil(3) | 91% | 92% | 94% | 93% |
|
| The Philippines | 100% | 99% | 96% | 97% | 97% | 97% | 98% |
|
| Myanmar | 64%(4) | Nil(5) | 55%(6) | 68%(6) | 75%(6) | 78%(6) | 78%(6) |
|
| Ghana | 99% | 99% | 99% | 100% | 99% | 99% | 99% |
|
| Nigeria | 96% | 96% | 95% | 96% | 97% | 96% | 95% |
|
| Sierra Leone | 93% | 92% | 91% | 93% | 92% | 92% | 92% |
|
| Kenya | 99% | 99% | 100% | 100% | 100% | 100% | 99% |
|
| Uganda | 83% | 84% | 89% | 94% | 98% | 100% | 100% |
|
| Tanzania | 100% | 100% | 100% | 100% | 100% | 100% | 100% |
|
| Rwanda | 96% | 94% | 96% | 97% | 97% | 97% | 97% |
|
| Zambia | 100% | 99% | 100% | 99% | 99% | 99% | 100% |
|
| (1) Collection efficiency refers to actual collections from clients divided by realizable collections for the period. (2) As of December 2020, the definition of collection efficiency has been amended in view of the increased amount of overdue collection and advance payments in various countries to: 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. This also means that collection efficiency no longer can exceed 100%. (3) The collection efficiency for 20-31 August 2021, and 1-29 September 2021 is nil due to the lockdowns in Sri Lanka. Only the collection efficiency for 1-19 August 2021, and 30 September 2021 is provided. (4) Collection efficiency is for 1-16 July 2021. The collection efficiency for 17-31 July is nil due to the holiday from 17 July to 1 August 2021, announced by the Myanmar Government, so only the collection efficiency for 1-16 July 2021 is provided. (5) Collection efficiency for August 2021 is nil due to the stay-at-home policy from 1 August to 24 September 2021, announced by the Myanmar Government. (6) Collections are impacted by the ongoing lockdowns. | ||||||||
· Collection efficiency across the Group increased or remained broadly stable compared to the previous month in all countries.
· Collections in India slightly improved to 76%, despite a lockdown in several districts of West Bengal in January. Collection efficiency, excluding instalments due from clients receiving the one-time loan restructuring, increased to 101%.
· Collection efficiency in India, including regular and overdue collections as well as advance payments, improved to 100% 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.
· Myanmar collections remained at 78%, despite the partial lockdown imposed by the government.
Loan portfolio quality up to and including January 2022(7, 8, 9)
|
| Gross OLP (in USDm) |
| Non-overdue loans |
| PAR>30 less PAR>180 | ||||||
|
| Nov/21 | Dec/21 | Jan/22 |
| Nov/21 | Dec/21 | Jan/22 |
| Nov/21 | Dec/21 | Jan/22 |
| India (total) | 125 | 113 | 111 |
| 57.7% | 67.3% | 68.8% |
| 12.6% | 12.3% | 11.1% |
| Pakistan | 77 | 79 | 81 |
| 99.7% | 99.7% | 99.7% |
| 0.2% | 0.2% | 0.2% |
| Sri Lanka | 8 | 8 | 8 |
| 82.5% | 87.2% | 85.3% |
| 4.3% | 3.6% | 3.9% |
| Philippines | 56 | 47 | 46 |
| 79.1% | 95.7% | 94.9% |
| 2.1% | 2.3% | 2.0% |
| Myanmar | 20 | 20 | 21 |
| 98.6% | 97.8% | 64.3% |
| 0.4% | 0.6% | 1.0% |
| Ghana | 49 | 49 | 46 |
| 99.2% | 99.3% | 99.2% |
| 0.3% | 0.2% | 0.3% |
| Nigeria | 41 | 40 | 37 |
| 90.9% | 92.7% | 90.9% |
| 2.6% | 2.8% | 3.4% |
| Sierra Leone | 7 | 7 | 7 |
| 78.8% | 87.4% | 72.3% |
| 4.9% | 5.6% | 6.5% |
| Kenya | 19 | 17 | 17 |
| 91.6% | 98.6% | 98.6% |
| 0.4% | 0.5% | 0.5% |
| Uganda | 10 | 10 | 10 |
| 89.1% | 89.8% | 90.7% |
| 3.8% | 3.1% | 1.9% |
| Tanzania | 33 | 35 | 36 |
| 98.4% | 99.1% | 99.1% |
| 0.3% | 0.2% | 0.2% |
| Rwanda | 3 | 3 | 3 |
| 92.7% | 92.9% | 92.6% |
| 2.4% | 2.6% | 3.0% |
| Zambia | 2 | 2 | 2 |
| 98.4% | 98.2% | 98.2% |
| 0.5% | 0.5% | 0.5% |
| Group | 449 | 429 | 425 |
| 83.2% | 89.1% | 87.5% |
| 4.4% | 4.1% | 3.8% |
|
| PAR>30 |
| PAR>90 |
| PAR>180 |
| ||||||
|
| Nov/21 | Dec/21 | Jan/22 |
| Nov/21 | Dec/21 | Jan/22 |
| Nov/21 | Dec/21 | Jan/22 |
|
| India (total) | 25.2% | 22.8% | 19.3% |
| 16.5% | 14.1% | 11.6% |
| 12.6% | 10.5% | 8.2% |
|
| Pakistan | 0.3% | 0.2% | 0.2% |
| 0.2% | 0.2% | 0.2% |
| 0.0% | 0.0% | 0.0% |
|
| Sri Lanka | 6.8% | 6.0% | 6.6% |
| 5.2% | 4.0% | 4.0% |
| 2.5% | 2.5% | 2.8% |
|
| Philippines | 17.2% | 2.5% | 2.5% |
| 16.0% | 1.5% | 1.9% |
| 15.1% | 0.3% | 0.6% |
|
| Myanmar | 1.0% | 1.1% | 1.6% |
| 0.7% | 0.7% | 1.0% |
| 0.5% | 0.5% | 0.6% |
|
| Ghana | 0.3% | 0.3% | 0.3% |
| 0.2% | 0.2% | 0.2% |
| 0.1% | 0.1% | 0.1% |
|
| Nigeria | 4.2% | 4.6% | 5.4% |
| 2.8% | 3.1% | 3.6% |
| 1.6% | 1.8% | 2.0% |
|
| Sierra Leone | 6.8% | 7.5% | 8.7% |
| 3.5% | 4.0% | 5.5% |
| 1.9% | 1.9% | 2.2% |
|
| Kenya | 1.0% | 1.1% | 1.0% |
| 0.8% | 0.8% | 0.8% |
| 0.6% | 0.5% | 0.5% |
|
| Uganda | 5.6% | 3.8% | 2.9% |
| 4.4% | 3.4% | 2.8% |
| 1.8% | 0.7% | 0.9% |
|
| Tanzania | 0.5% | 0.5% | 0.4% |
| 0.4% | 0.4% | 0.4% |
| 0.2% | 0.3% | 0.3% |
|
| Rwanda | 4.7% | 4.5% | 4.8% |
| 3.5% | 3.2% | 3.2% |
| 2.3% | 1.9% | 1.8% |
|
| Zambia | 0.7% | 0.7% | 0.8% |
| 0.4% | 0.5% | 0.5% |
| 0.2% | 0.2% | 0.2% |
|
| Group | 10.1% | 7.3% | 6.4% |
| 7.2% | 4.6% | 4.0% |
| 5.7% | 3.1% | 2.6% |
|
|
(7) Gross OLP includes the off-book BC and DA model, excluding interest receivable and before deducting ECL provisions and modification loss. (8) 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 2% of the Gross OLP. (9) 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 improved to 6.4%, primarily due to the improvements in India and Uganda and movement of a component of overdue that is more than 365 days.
· 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 31 January 2022(10)
| Countries | Jul/21 | Aug/21 | Sep/21 | Oct/21 | Nov/21 | Dec/21 | Jan/22 |
|
| India | 25% | 36% | 52% | 39% | 85% | 88% | 78% |
|
| Pakistan | 98% | 103% | 100% | 100% | 98% | 100% | 100% |
|
| Sri Lanka | 56% | 87% | Nil(12) | 86% | 100% | 113% | 70% |
|
| The Philippines | 87% | 91% | 89% | 90% | 90% | 81% | 80% |
|
| Myanmar | 64% | Nil(11) | 37% | 73% | 90% | 95% | 99% |
|
| Ghana | 85% | 112% | 120% | 111% | 114% | 108% | 74% |
|
| Nigeria | 103% | 104% | 110% | 128% | 134% | 93% | 71% |
|
| Sierra Leone | 119% | 133% | 124% | 112% | 112% | 110% | 97% |
|
| Kenya | 107% | 97% | 100% | 96% | 103% | 55% | 95% |
|
| Uganda | 60% | 93% | 109% | 115% | 121% | 69% | 81% |
|
| Tanzania | 86% | 91% | 100% | 107% | 109% | 107% | 114% |
|
| Rwanda | 61% | 95% | 102% | 101% | 105% | 98% | 65% |
|
| Zambia | 103% | 102% | 102% | 110% | 111% | 109% | 76% |
|
| (10) Disbursements vs collections refers to actual loan disbursements made to clients divided by total loans collected from clients in the period. (11) Disbursements vs collections for August is nil due to the stay-at-home policy announced by the Myanmar Government. (12) Disbursements vs collections for September is nil due the nationwide lockdowns.
| ||||||||
· Due to the seasonal slowdown for disbursement in January, disbursements of new loans decreased or remained stable as a percentage of weekly collections in nine countries.
Development of Clients and Outstanding Loan Portfolio until 31 January 2022
|
| Clients (in thousands) | Delta | Gross OLP (in USDm) | Delta | |||||||
| Countries | Jan/21 | Dec/21 | Jan/22 | Jan/21-Jan/22 | Dec/21-Jan/22 | Jan/21 | Dec/21 | Jan/22 | Jan/21-Jan/22 USD | Jan/21-Jan/22 CC (13) | Dec/21-Jan/22 USD |
| India | 719 | 541 | 521 | -28% | -4% | 165 | 113 | 111 | -33% | -31% | -2% |
| Pakistan | 426 | 512 | 520 | 22% | 2% | 66 | 79 | 81 | 24% | 36% | 3% |
| Sri Lanka | 56 | 53 | 52 | -7% | -2% | 9 | 8 | 8 | -10% | -4% | -4% |
| The Philippines | 305 | 290 | 290 | -5% | 0% | 49 | 47 | 46 | -6% | 0% | -1% |
| Myanmar | 132 | 111 | 112 | -15% | 1% | 33 | 20 | 21 | -37% | -16% | 2% |
| Ghana | 153 | 159 | 158 | 3% | 0% | 43 | 49 | 46 | 8% | 16% | -6% |
| Nigeria | 253 | 254 | 246 | -3% | -3% | 31 | 40 | 37 | 19% | 30% | -7% |
| Sierra Leone | 37 | 44 | 43 | 17% | -2% | 4 | 7 | 7 | 49% | 68% | -5% |
| Kenya | 95 | 119 | 118 | 24% | -1% | 13 | 17 | 17 | 31% | 35% | 3% |
| Uganda | 80 | 92 | 92 | 15% | 0% | 7 | 10 | 10 | 32% | 26% | 0% |
| Tanzania | 125 | 174 | 179 | 43% | 3% | 22 | 35 | 36 | 65% | 64% | 3% |
| Rwanda | 19 | 18 | 18 | -3% | 1% | 3 | 3 | 3 | 15% | 21% | -4% |
| Zambia | 6 | 15 | 15 | 161% | 3% | 0.5 | 2 | 2 | 340% | 271% | 1% |
| Total | 2,404 | 2,382 | 2,364 | -1.7% | -0.7% | 445 | 429 | 425 | -5% | 2% | -1% |
(13) 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 stable at 2.4m, and disbursements as percentage of collections decreasing, Gross OLP decreased to USD 425m (1% lower than in December 2021 and 5% lower than in January 2021).
Selected moratoriums(14) on loan repayments until 31 January 2022
|
| Clients under moratorium (in thousands) |
| ||
| Countries | Nov/21 | Dec/21 | Jan/22 | As % of Total Clients |
| India | 205 | 205 | 205 | 39% |
| Pakistan | 0 | 0 | 0 | 0% |
| Sri Lanka | 1 | 0 | 0 | 0% |
| The Philippines | 0 | 0 | 0 | 0% |
| Myanmar | 49 | 44 | 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 | 255 | 249 | 205 | 9% |
|
| Moratorium amounts (USD thousands) |
|
| ||
| Countries | Nov/21 | Dec/21 | Jan/22 | January Moratoriums as % of OLP | As % of Total Moratoriums |
| India | 31,765 | 28,600 | 26,178 | 24% | 100% |
| Pakistan | 0 | 0 | 0 | 0% | 0% |
| Sri Lanka | 12 | 0 | 0 | 0% | 0% |
| The Philippines | 0 | 0 | 0 | 0% | 0% |
| Myanmar | 903 | 779 | 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 | 32,680 | 29,379 | 26,178 | 6% | 100% |
(14) 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 39% 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.
· The moratorium amount across the Group decreased to USD 26.2m, which represents 6% of the Group's Gross OLP.
Key events in February 2022
· Other than the existing partial lockdown and curfews in Myanmar and Rwanda, 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 15 February 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-19 variants in our operating countries, and (iv) the associated disruption this may cause to the businesses of our clients.
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Enquiries:
ASA International Group plc
Investor Relations +31 6 2030 0139
Véronique Schyns vschyns@asa-international.com
About ASA International Group plc
ASA International 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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