XacBank / Mongolia
Mission
To contribute to sustainable development of Mongolia that can come only from educated and skilled people and competitive and dynamic businesses concerned equally about Planet, People, and Profit. The Bank will provide equitable access to transparent, reliable and responsive banking products and services to the Bank's clients, including its traditional Micro-entrepreneurs as well as Small and Medium businesses.
Short History
XacBank was created as a result of the merger of two largest non-bank financial institutions (NBFI) in Mongolia, Goviin Ehlel (Gobi Start) LLC and XAC (Golden Fund for Development) LLC, on 1st of October 2001. Goviin Ehlel LCC was established by Mercy Corps in December 1999 with funding from USAID as a NBFI serving rural businesses. XAC LLC began in 1998 as part of the MicroStart Mongolia project under UNDP, shortly afterwards transformed into Mongolia's first NBFI by uniting the micro-financial service activities of six national NGOs.
These NBFIs originally operated in different geographic regions and were serving different markets, Small and Medium enterprises loans vs. Micro business. However, both organizations had the same strategic goal of becoming nationwide banking institution, offering a wide range of financial services. All these factors became the foundation of the merger of these two independent institutions to form XacBank - the first commercial bank in Mongolia with a social mission. By the end of its first year of operation in 2002, the Bank established its presence in each of 21 aymags in the country. Since that time the Bank has continued to expand with new branch and extensions, franchise service Saving and Credit Cooperatives, branchless banking solutions, fulfilling its mission and strategy of providing the most accessible and transparent banking services aimed at the marginalized citizens in remote rural areas, including the nomadic herders. XacBank is continuously growing and becoming an innovative leader in offering a full range of innovative loan and deposit products with personalized customer service targeted at various segments of the market.
Structure
XacBank’s ownership comprises the EIT (Employee Investment Trust) Capital Management (24.31%), International Finance Corporation (11.81%) and the European Bank for Reconstruction and Development (11.15%) along with various ethical/social investors including Mercy Corps (15.78%) and Triodos (14.98%). Recently, the company’s shareholders have provided it with an increasing amount of debt-funding, as have other specialist microfinance investors, often with an ethical mandate. At 30 June 2009, borrowings stood at 50% of XacBank’s total funding (FY05: 29%) against deposits on 39% (FY05: 52%). These borrowings should be reasonably stable amidst the current tightened global credit conditions, although the bank may well have to now refocus more on deposit funding. A chart of the Bank’s organizational structure as at 30 June 2009 is located on page 5.
At 30 September 2009 XacBank’s total assets were equal MNT234.0 billion, up 2,7 percent from 1st Quarter 2009. Loan portfolio totals MNT162.2 billion, with 63,355 borrowers, up by 7.1. percent and 6.5, respectively. Portfolio-at-Risk (PAR over 1 day was maintained at 4.91 percent, over 30 days at 3.48 percent, and over 90 days at 2.42 percent. Number of depositors increased to 117.1 thousand with the public deposit balances, excluding current accounts, increased by 13.3 percent and reaching MNT80.2 billion.
Board of Management
- Bat-Ochir Dugersuren (CEO)
- Soronzonbold Lhagvasuren (First Deputy CEO)
- Tur-Od Lkhagvajav (Deputy CEO)
- Gerelmaa Yunden (Chief Credit Officer)
- Delgerjargal Bayanjargal (Chief Financial Officer)
Bank contact details
Website: www.xacbank.mn; www.mixmarket.org
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