FMO (Netherlands)

FMO (Dutch: Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V.) is a Dutch development bank structured as a bilateral private-sector international financial institution based in the Hague, the Netherlands. FMO manages funds for the Ministries of Foreign Affairs and Economic Affairs of the Dutch government to maximize the development impact of private sector investments. It is licensed as a bank and supervised by the Dutch Central Bank.

FMO
Native name
Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V.
TypeState owned company
IndustryDevelopment Finance
FoundedJuly 8, 1970 (1970 -07-08)
HeadquartersThe Hague, Netherlands
ProductsEquity financing, loans, trade finance, credit guarantees
RevenueAftertax:€:255 million (US$:296 million) (2017) [1]
Total assets€:9.2 billion (US$:10.7 billion) (2017)[2]
Number of employees
444 (2017)
Websitewww.fmo.nl

The Dutch government holds 51% of the shares, but FMO operates as a commercial company. Due to its relationship with the Dutch government, it is able to take risks which commercial financiers are not able or not prepared to take. The FMO has a AAA rating from Standard and Poor's. As of December 2017, the bank's total asset valuation was €8.32 billion (US$9.67 billion), and its shareholders' equity was €2.83 billion (US$3.29 billion).[3]

FMO's mandate is to provide long term capital for projects in countries in which commercial investors do not yet dare to invest. It invests risk capital in companies and financial institutions in developing countries and has a strict policy on maximizing development impact with a methodology designed to make sure that FMO's return on investment is not just financial but also has positive environmental and social effects.[4] Investments to date include Yoco,[5] WWF and other NGOs in Paraguay's Agricultural sector.[6]

History

FMO was founded in 1970 by the Dutch Government in conjunction with commercial banks, the national employers' association, labor unions, and private investors to invest in private sector projects in developing countries and emerging markets. In March 2008, FMO achieved bank status; the bank has been under the supervision of the Dutch Central Bank (DNB) since then.

Objectives

FMO manages funds for the Ministries of Foreign Affairs and Economic Affairs of the Dutch government to maximize the development impact of private sector investments. For instance, the Capacity Development Program provides funding with the aim to create access to management and technical know-how.

Controversial investments

In 2009 the FMO invested in a coal power plant near Bargny in Senegal, called Sendou I. The project triggered a debate about the impact on the environmental circumstances of the inhabitants.[7][8] Following this, the Independent Complaints Mechanism of FMO has undertaken a Compliance Review and a Mediation process,[9] in reaction to which the Management Board of FMO has written an official response [10]

Ownership

The stock of FMO is held by individual, corporate and public Dutch entities as outlined in the table below:[11]

FMO Stock Ownership
RankName of OwnerPercentage Ownership
1Dutch Government51.00
2Large Dutch Banks42.00
3Dutch Employers' Association
4Dutch Trade Unions
5Individual Dutch Investors
Total100.00

See also

References
  1. "Financial performance". Annual Report FMO. FMO. Retrieved 27 July 2018.
  2. "Financial performance". Annual Report FMO. FMO. Retrieved 27 July 2018.
  3. "Financial performance". Annual Report 2017. FMO. Retrieved 27 July 2018.
  4. "NETHERLANDS DEVELOPMENT FINANCE COMPANY (FMO)". UNEP Finance Initiative.
  5. "South African tech group Yoco raises $16 million in funding". Business Tech.
  6. "An unlikely partnership to tackle deforestation in Paraguay". Vimeo.
  7. "Coal power plant in Bargny, Senegal". Environmental Justice Atlas. Retrieved 23 April 2018.
  8. "AfDB authorises thorough investigations on Sendou Coal Fired power plant". African Review. April 24, 2017.
  9. "FMO Independent Complaints Mechanism Panel report No. 2" (PDF). FMO.nl. ICM. Retrieved 27 July 2018.
  10. "FMO Management Response to the Independent Expert Panel's Compliance Review Report regarding the Complaint on the investment in Sendou 125 MW coal-fired power plant" (PDF). FMO.nl. FMO. Retrieved 27 July 2018.
  11. "Contact us". Alios-finance.com. Retrieved 9 November 2017.
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