Despite the turbulence in the Eurozone and other international markets, 2012 was a very successful year for FMO. The markets we invest in showed sustained economic growth in spite of some impact from the global financial crisis. Deep knowledge, expertise of our markets and close relationships with our clients helped us to reach €1,390 million in new commitments (of which €160 million represented the State funds) – an increase of 6% from the previous year. Of the new commitments, 40% were made in low-income countries (2011: 45%).
Our investment strategy shows continuous and sustainable profitability. In 2012 we achieved record net profits of €146 million (2011: €93 million) mainly as a result of substantially higher results from equity investments and decreased value adjustments on our loan and equity portfolio. In 2012 we have refined our group specific provisioning model for our loan portfolio. A provision for information backlog used to be taken during the first two years of a loan. However, FMO’s loss history has shown that no structural significant losses have occurred in the first two years after disbursement as a result of information backlog. Therefore this part of the provision has been released. This has led to a release of €32 million of the group-specific value adjustments.
FMO finances sustainable private sector growth in developing and emerging markets. Currently 43% of FMO’s committed portfolio consists of investments made in low-income countries (LICs) and 39% in lower-middle-income countries. This underlines the potential of these countries and FMO’s capability of achieving good profitability and healthy growth in these markets. The return on equity increased by 2.5 percentage points from 5.9% in 2011 to 8.4% in 2012.
|Committed portfolio (including government funds €xmln)||6,281||5,874||5,292||4,598||4,182|
|Share in Africa (%)||30||30||28||29||28|
|Share mezzanine and equity (%)||44||45||46||45||43|
|Local currency (%)||12||13||16||15||16|
|New contracts (including government funds €xmln)||1,390||1,306||1,026||911||1,314|
|Net profit (€xmln)||146||93||126||60||48|
|Result sale of equity (€xmln)||72||32||36||16||78|
|Government funds of committed portfolio (%)||13||14||14||16||15|
|Shareholders’ equity (€xmln)||1,822||1,665||1,514||1,327||1,229|