Fedecrédito considers launching insurer

Monday, May 4, 2009

El Salvador's Fedecrédito, the country's leader in microfinance, is considering launching an insurance company next year, Fedecrédito president Armando Rosales told BNamericas.

"This year, we'll conduct a feasibility study for the creation of our own insurance company," Rosales said on the sidelines of the 22nd congress of the World Savings Banks Institute held in Santiago on April 30-May 1.

Fedecrédito operates as a financial intermediary providing its 55 cooperative members - 48 cajas de crédito and seven workers' banks - with credit. These cooperatives in turn lend to micro and small enterprises.

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Rosales said Fedecrédito's insurer would offer all types of insurance products - non-life and life - targeting low-income earners.

Fedecrédito would control 51% of the insurance company and would be looking for strategic partners for its venture capital business in the Central American region and elsewhere, Rosales said.

Fedecrédito held US$569mn in loans and US$146mn equity at end-2008.