Peter johnson

Microfinance Retail Funds

Peter JohnsonPartner and Capital Markets Manager

TBLI AsiaSeptember 15, 2011

Securities transactions through DWM Finance LLC member FINRA/SIPCPast performance is not indicative of future results. Please see end of presentation for Important Risks and Disclosures

Microfinance Funds Channel Capital to Microfinance Institutions

Investors allocate capital to MIVs which invest in MFIs in developing countries

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• Microfinance Fund Mangers create investment vehicles to channel investor funds

• Vehicles provide MFIs access to capital markets and funding to grow

• MFIs provide financial services to entrepreneurs in developing countries

• Investors target social impact and financial return

Microfinance Institutions

Investment Vehiclesdebt, equity, hybrids &

othersMicrocredit Borrowers

Investors

MF Funds

MFIs – Microfinance InstitutionsMIVs – Microfinance Investment Vehicles


MIVs provide debt, equity & guarantee financing to MFIs

Majority of MIV financing is through debt investments

Microfinance Investment Vehicles: Overview

Estimated 102 MIVs globally with total assets under management of $6.8 billion1

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86%

34%

25%

10%

21%2

0%

25%

50%

75%

100%

2007 2008 2009 2010 2011

MIV Total Assets Growth1

1 Source: Symbiotics MIV Survey, 2011 (as of 2011)2 Survey Respondents forecast for 2011. Historical data refers to previous

CGAP MIV surveys.

82%

10%

0.1%8%

Financial Instruments (% of Microfinance Portfolio)1

Direct Microfinance Portfolio - Debt

Direct Microfinance Portfolio - Equity

Direct Microfinance Portfolio - Guarantees

Indirect Direct Microfinance Portfolio


Private Institutional Investors represent the largest share of investors across fund types, followed by High Net Worth Individuals (HNWI) and Retail Investors and then

Public Sector Funders

Source: Symbiotics MIV Survey, 2011

Microfinance Investment Vehicles: Investors

Retail Investors and HNWI provide nearly one third of MIV funding

4

26% 31%

9% 13%

45% 40%

60%61%

30% 30% 31%27%

0%

20%

40%

60%

80%

100%

All MIVs Fixed Income Funds

Mixed Funds Equity Funds

Sources of MIV Funding

Retail Investors & High Net Worth Individuals

Private Institutional Investors

Public Sector Funders


Microfinance Funds for Retail Investors and HNWI: Examples

Retail Investors seek double bottom line of financial return and social impact

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Organization Investment Minimum

Target Annual Return1 Investor Location

MicroPlace $20 1-3%2 US

Kiva $25 0% (principal repaymentonly)

Global

Oikocredit$250 ≤2% US, Canada,

Europe, UK, Mexico, Asia

Calvert Foundation Community Investment Notes

$1,000 1-5 year notes: 0.5% - 2.0%

US

responsAbility Global Microfinance Fund

$1,000 Excess of money market level in the fundcurrency

Europe

BlueOrchard DexiaMicrofinance Fund

$10,000 6M Libor + 1-2% US and Europe

1 As of September 10, 20112 Depends on investment. Fixed returns range from 0.5%-3.5% with an average return of 1-3% stated.


The DWM Microfinance Fund – J: Overview

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Daiwa Securities and DWM launched the first commercial microfinance fund in Japan

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Net Asset Value1

USD 248 million

Launch Date March 2011

StatusOnly Open to

Japanese Investors

Use of ProceedsDFI Bonds &

Loans to MFIs

Dividend Payment

Semi-annually

The $242 million Daiwa

Microfinance Fund invested

$236 million in its underlying

investment vehicle, The DWM

Microfinance Fund-J (DWMF-J)

Distributed by Daiwa Securities

Co. Ltd.

DWMF-J makes only local

currency debt investments

The DWM Microfinance Fund – J: Overview

1 As of 6/30/11


Daiwa Microfinance Fund Historical NAV (¥)

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NAV Line

High on 4/11/11 10834.00

Average 10102.29

Low on 09/09/11 9499.00

10800

10600

10400

10200

10000

9800

9600

9400

9499


DWMF-J Portfolio: Overview

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Azerbaijani Manat2.8%

Brazilian Real 20.6%

Costa Rican Colon 1.3%

Honduran Lempira 0.2%

Hungarian Forint 2.3%

Indonesian Rupiah 3.9%

Indian Rupee 6.5%

Jordanian Dinar 0.9%

Cambodian Riel 0.9%

Mongolian Tugrik 3.1%

Mexican Peso 11.8%

Peruvian Nuevo Sol 3.2%

Polish Zloty 0.1%

Russian Ruble 19.4%

Turkish Lira 4.1%

South African Rand 19.2%

Portfolio of local currencies from MFI loans and bonds issued by development finance institutions

DWMF-J Exposure by Currency1

1 As of August 31, 2011


About DWM: Investment Manager Track Record

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DWM Asset Management, LLC Fund Management

Relationships with 400+ Microfinance Institutions (“MFIs”) in over 80 countries

Address full sweep of MFIs’ capital needs

Financial innovation – leader in creative microfinance transactions

Experienced team with long careers in emerging markets investment banking &

fund management

$850+ million Microfinance Assets under Management1

Institutional-scale origination capacity & credit skills

Emerging Markets fund manager since 1994

1 As of 6/30/11

$65

$333

$484

$600 $640

$850

$0

$200

$400

$600

$800

$1,000

2006 2007 2008 2009 2010 2011

DWM's AUM (Millions)


About DWM: DWM Aims to Deliver Social Impact

DWM MIVs have channeled over $850 million to approximately 140 MFIs in developing countries, impacting

over 3 million micro-entrepreneurs and family members

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$850+ million DWM MIVs1

Investments in approximately 140

MFIs

3 million+ entrepreneurs and

family members reached1

1 Assuming an average microloan size of $1000 and assuming an average family size of four in the countries in which DWM invests


Risks and Disclosures

12

Opinion

Any statements of opinion constitute only current opinions of DWM Asset Management, LLC, which are subject to change and which DWM Asset Management, LLC does not undertake to update.

Portfolio Holdings

Portfolio data is “as of” the date indicated and should not be relied upon as a complete or current listing of the holdings of the portfolio. The holdings are subject to change without notice, and may not represent current or future portfolio composition.

Some information in this report is based on unaudited information and is subject to change.

Short Performance HistoryPerformance history of less than two years may not provide an adequate basis from which to determine the performance of a fund. Accordingly, such a short performance history should not be relied upon.

Unaudited Information Subject to ChangeSome information in this report is based on unaudited information and is subject to change.

Third Party Information

Some information contained herein has been obtained from DWM Finance, LLC and other third party sources and has not been independently verified by DWM Asset Management, LLC. DWM Asset Management, LLC makes no representations as to the accuracy or the completeness of any of the information herein.

Strategy/Process Risk Disclaimer

Performance is shown net of fees and expenses and includes the reinvestment of dividends and capital gain distributions. Many factors affect fund performance including changes in market conditions and interest rates and in response to other economic, political, or financial developments. Investment return and principal value of your investment will fluctuate, so that when you investment is sold, the amount you receive could be less than what you originally invested. Past performance is not a guide to or indicative of future results. Future returns are not guaranteed and a loss of principal may occur. No investment strategy or risk management technique can guarantee returns or eliminate risk in any market environment.


Risks and Disclosures

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THIS DOCUMENT DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY AN INTEREST IN THE INVESTMENTS DESCRIBED HEREIN. NO SUCH OFFER OR SOLICITATION WILL BE MADE PRIOR TO THE DELIVERY OF AN OFFERING MEMORANDUM AND OTHER MATERIALS RELATING TO THE MATTERS MENTIONED HEREIN.

THIS DOCUMENT IS A SUMMARY, DOES NOT PUPORT TO BE COMPLETE, IS FOR DISCUSSION PURPOSES ONLY AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE MORE DETAILED DISCUSSION CONTAINED IN THE ACTUAL OFFERING MATERIALS.

NO REPRESENTATION OR WARRANTY IS MADE BY DEVELOPING WORLD MARKETS OR ANY OF ITS AFFLIATES (COLLECTIVELY, DWM), INCLUDING ANY OF ITS AGENTS OR OTHER REPRESENTATIVES, AS TO THE ACCURACY OR COMPLETENESS OF THE INFORMATION CONTAINED HEREIN. ONLY THOSE PARTICULAR REPRESENTATIONS AND WARRANTIES WHICH MAY BE MADE IN DEFINITIVE AGREEMENTS RELATING TO THE FUND OR OTHER INVESTMENT DESCRIBED HEREIN, WHEN, AS AND IF EXECUTED, AND SUBJECT TO SUCH LIMITATIONS AND RESTRICTIONS AS MAY BE SPECIFIED IN SUCH DEFINITIVE AGREEMENTS, SHALL HAVE ANY LEGAL EFFECT.

THIS DOCUMENT IS BEING PROVIDED TO YOU ON A CONFIDENTIAL BASIS, ACCORDINGLY, THIS DOCUMENT MAY NOT BE REPRODUCED IN WHOLE OR IN PART, AND MAY NOT BE DELIVERED TO ANY PERSON WITHOUT THE PRIOR WRITTEN CONSENT OF DWM. COPYRIGHT 2011.


Contact Information

DWM Asset Management LLC

750 Washington Boulevard, Stamford, Connecticut 06901, USA

www.dwmarkets.com

Tel: +1.203.655.5453 Fax: +1.203.656.9528

FOR MORE INFORMATION CONTACT:

Peter Johnson Hiroshi Amemiya Partner & Manager, Capital Markets Representative, [email protected] [email protected]

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Peter johnson

Economy & Finance