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Investment Fund Manager role

Benefits to investment fund managers

Interest in blended finance from global foundations, HNWI’s and family offices, development finance institutions, and corporate foundations.
Infrastructure’s risk/reward/maturity profile is well suited for many types of institutional investors including sovereign wealth funds, insurance companies, and pension funds.

Investment Fund Manager case studies
0
Investment Fund Manager
Fund
Link
Notes
1
Deutsche Bank
Africa Agriculture and Trade Investment Fund (AATIF)
https://www.db.com/cr/en/concrete-Africa-Agriculture-Trade-and-Investment-Fund.htm
Deutsche Bank manages the fund and is a catalytic shareholder
2
Deutsche Bank
Deutsche Bank Global Commercial Microfinance Consortium 1
https://www.convergence.finance/resource/56vSl935m8kcUuK0o6c0SW/view
4
SJF Ventures
Sustainable Jobs Fund
https://www.macfound.org/media/files/C3_Case_Studies_-_print_read.pdf
Catalytic Capital Investment: $1 million PRI* from MacArthur Foundation; other first-fund investors include Bank of America, Citibank, Deutsche Bank, First Union (now Wells Fargo), MetLife, and MBNA America Bank.
5
responsAbility Investments AG
Energy Access Debt Fund
6
NCB Capital Impact
FreshWorks Fund
Both JP Morgan and JP Morgan Foundation participated
7
Ninety One
Emerging Africa Infrastructure Fund
There are no rows in this table
A recent example of a commercial bank’s increasing involvement in development finance is the
, to expand its development-oriented financing activities in emerging markets and galvanize private capital towards the SDGs. Another example is
.

Top private investors in blended finance transactions


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Top private investors in blended finance transactions, according to
.

Mandate and Appetite for Investment Assets by Investor Segment

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Other investment mechanisms

Social impact bonds


Selection criteria for screening potential partners

Reputation in the market
Track record of success
Implementation capacity
Alignment of mission with development impact goals

Steps that prospective investment managers can take

Read Global Impact Investing Network’s (GIIN)
Join GIIN’s
(members include UBP, SBC, Rothschild, RBC Global Asset Management, BMO Global Asset Management, AXA Investment Management, Bain Capital, and ABN AMRO)

Recommendations for scaling blended finance

Focus on portfolio approaches rather than stand-alone projects to mobilize investors at scale. Portfolio approaches are preferred for three key reasons:
Only a small number of stand-alone projects are a suitable ticket size for private investors. Aggregating multiple projects can achieve the required critical mass.
Diversification across projects reduces risk and risk-return variance for investors. Indicatively, the Big 3 rating agencies’ methodologies allow for a two-notch upgrade for diversification across multiple borrowers in Non-Investment Grade Countries – that is, a portfolio of “B” projects can be enhanced to “BB-,” simply through diversification. In countries with very high country risk (e.g. Low-Income Countries), diversification across multiple countries is highly beneficial.
Bundling transactions accelerates taking transactions to market and lowers transaction costs as compared to individual projects.
In a joint paper published in April 2020 by Convergence and UK DFID entitled “
,” we attribute the strong capacity of commercial banks to participate in blended transactions as arrangers and distributors to their ability to leverage expertise which deal originators, institutional investors, and catalytic capital providers can connect. B2T looks to structure impact-agnostic commercial capital and impact-driven concessional capital into replicable institutional-caliber blended finance investment products that solve the climate emergency and other critical development goals. from different divisions (e.g., debt capital markets, asset management, research) and broader global networks and subsidiaries. For example, financial institutions with established networks in developing countries are more familiar with the processes for underwriting and sourcing opportunities in those contexts and are therefore better positioned than their counterparts whose networks remain in developed markets. A recent example of a commercial bank’s increasing involvement in development finance is the
, to expand its development-oriented financing activities in emerging markets and galvanize private capital towards the SDGs.


Additional relevant case studies

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