AIG TAKES HOLDING IN CHINESE MICROCREDIT BUSINESS MICROCRED

THE WORLD’S largest insurer, American International Group ( AIG), has acquired an 18% stake in MicroCred Nanchong, China (MNC). As a result of the deal, AIG has exclusive rights to sell microinsurance to clients of MNC - the first wholly foreign-owned microcredit company in China - for two years. Rick Pfeiffer, chairman and chief executive of AIG Consumer Finance Group, said the move would allow AIG to broaden the choice and availability of financial products to the small business sector in the Nanchong municipality. "By providing access to financial products that otherwise may not be readily available, MNC helps to support the development and growth [of Nanchong’s small business community]," Pfeiffer said. Nanchong, the second-most-populated municipality in Sichuan, has a population of 7.3 million and boasts more than 108,000 registered micro- and small enterprises. MNC began operations in October of 2007 and offers its clients a microloan product with an average loan size of Yuan25,000 ($3,648). As well as AIG, it counts as shareholders the International Finance Corporation, KfW Bankengruppe and MicroCred SA. Later this year, MNC plans to introduce a small business loan product with an average loan size of around Yuan75,000 for micro- and small enterprises in the Nanchong municipality.