General information

Structure

Triodos Microfinance Fund was launched in March 2009 as a sub-fund of Triodos SICAV II, the first Luxembourg investment company to be launched by Triodos Bank. The fund has an open-end fund structure and is not quoted on any stock market. Triodos Microfinance Fund has euro as well as British pound sterling share classes for retail, private banking and institutional investors.

The Board of Directors has appointed Triodos Investment Management BV as the external alternative investment fund manager of Triodos SICAV II. Triodos Investment Management BV is incorporated under the laws of the Netherlands and is wholly-owned subsidiary of Triodos Bank NV. Triodos Investment Management BV is supervised by the Dutch regulator, Autoriteit Financiële Markten.

The Annual General Meeting of Shareholders takes place in the city of Luxembourg, at a place specified in the notice of the meeting, each year on the last Wednesday in April. If such day is not a business day, the meeting will be held on the next business day. Notice of any General Meeting of Shareholders will be mailed to each registered Shareholder at least eight days prior to the meeting and will be published to the extent required by Luxembourg law in the Mémorial. Triodos SICAV II publishes an integrated detailed audited report annually. Triodos SICAV II also publishes an integrated detailed semi-annual report. In addition separate reports for each sub-fund of Triodos SICAV II are published. Copies may be obtained free of charge from the registered office of Triodos SICAV II and can be downloaded from Triodos Bank: www.triodos.com and www.triodos.nl.

Investment policy

Triodos Microfinance Fund invests, directly or indirectly, in microfinance institutions (MFIs) and other applicable financial institutions with a track record that have gone through the first phase of rapid growth and are financially sustainable. The fund is also allowed to invest in greenfield MFIs. In most cases these institutions will be supervised by relevant local government authorities.

Triodos Microfinance Fund invests in equity, subordinated debt, convertible debt, senior debt and debt instruments in qualifying investments. The fund investment amount per investment project is assumed to be typically between EUR 1 million and EUR 10 million, but is bound by single client exposure and other investment restrictions as presented in the prospectus. The fund will generally take minority equity positions in its investees. Triodos Microfinance Fund will mainly invest in non-listed securities and investment instruments other than transferable securities. However, the fund may also, on an ancillary basis, invest in stock-listed companies. The equity investments of Triodos Microfinance Fund will primarily be in local currency, i.e. any currency other than US dollars and euros. For debt financing, the investments will be a mixture of local currency and investments in US dollars and euros. Investments in euros and in US dollars will be hedged to a large extent against the share classes’ reference currencies (perfect hedges of the interest and principal flows may not be economical). Investments in local currencies may be hedged where possible and where deemed appropriate. Cash and liquid assets will be mainly invested in euros or US dollars.

Triodos Microfinance Fund may enter into syndicated finance agreements with other funds managed by Triodos Group or managed by other entities.

Fiscal aspects

According to the law in force and current practice, Triodos Microfinance Fund is not subject to any Luxembourg tax on income and capital gains. Dividends paid by Triodos Microfinance Fund are not subject to any Luxembourg withholding tax. Since January 1, 2010, Triodos Microfinance Fund is no longer subject to any subscription tax. In addition, the issue of shares in the SICAV is not subject to any registration duties or other taxes in Luxembourg. Some dividend and interest income from Triodos Microfinance Fund’s portfolio may be subject to withholding taxes at variable rates in the countries of origin.

Shareholders in Triodos Microfinance Fund in principle do not have to pay any income and capital gains tax, any withholding tax, or any other form of tax in the Grand Duchy of Luxembourg (except with regard to (I) shareholders domiciled, resident or having a permanent establishment in Luxembourg, (II) some non-residents of Luxembourg who own 10% or more of the capital of the fund and who sell all or part of their shares within six months of their acquisition and (III) in some limited cases, some categories of former residents of Luxembourg if they own 10% or more of the capital of the SICAV). The above information is based on the law in force and current practice and is subject to change.

Investors should be aware that income or dividends received or profits realised may result in taxation in their country of origin, residence or domicile.

Triodos sustainability reporting

Triodos Microfinance Fund is managed by Triodos Investment Management B.V., a wholly-owned subsidiary of Triodos Bank N.V. The co-workers involved in the management of the funds are employed by Triodos Bank. The annual report of Triodos Bank is an integral sustainability report, which is applicable to all entities within the Triodos group of companies.

All social policy aspects, including the remuneration policy, are described in Triodos Bank’s annual report.

Triodos Bank has been using the guidelines drawn up by the Global Reporting Initiative (GRI) since 2001. GRI was established in 1997 by the United Nations and the Coalition for Environmentally Responsible Economies. GRI aims to establish a consistent framework for sustainability reporting and thus make performances objective and easier to compare. Triodos Bank is one of GRI’s organizational stakeholders.

In 2013, GRI introduced new guidelines aimed at making reporting more relevant for the sustainability impact of the institution and more useful for its stakeholders. This is done mainly by focusing attention on the issues that Triodos Bank and our stakeholders find the most important or essential for their activities. We have since enhanced this approach, which we first used in our report for 2013. In this report the G4 guidelines have been applied comprehensively. Further information about the application of the G4 guidelines can be found on www.annual-report-triodos.com.

Our reporting is based on internal and external data. This year’s report was prepared partly on the basis of discussions, including a thinking session with a number of external parties organised specifically for this purpose.

Climate-neutral operations

Triodos Bank’s environmental policy is based on the trias energetica. This means that the bank uses as little energy as possible, uses sustainable energy or sustainable resources whenever possible and offsets the climate impact of energy that is generated. The bank thus minimises and offsets its environmental impact. Triodos Bank is a climate neutral, CO2-neutral organisation.

For further information about the social and environmental performances of Triodos Bank and its investment funds we refer to the annual report of Triodos Bank.

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