Latham & Watkins has advised the arrangers on the successful launch of a new financial inclusion bond by responsAbility, the leading Swiss impact asset manager, in partnership with the U.S. International Development Finance Corporation (DFC). This US$123.5 million bond, arranged by J.P. Morgan, is designed to provide institutional investors with access to impact investments via listed securities, thereby achieving positive social and financial impacts at scale in financial inclusion.
The financial inclusion bond specifically targets financial inclusion projects, facilitating access to financial services for individuals and micro, small, and medium enterprises (MSMEs) in developing countries who currently lack access to traditional banking services. These investments promote local jobs, reduce poverty, empower women, and support critical social areas such as education and health. The bond has already allocated capital to about 30 qualified microfinance and SME-focused financial institutions in 18 developing countries across the globe, which — due to specialized and differentiated business models — are often not the focus of larger investors.
The U.S. Development Finance Corporation (DFC) has supported the financial inclusion bond in the senior tranche, demonstrating the US government’s commitment and willingness to support investments in the area of international development to support market innovation and mobilize private capital.
The Latham team was led by London finance partner Jeremiah Wagner, with associates Boin Cheong and Jason Wong.
