Microfinance Sector in Emerging Capital Markets: Peruvian Financial Entity CMAC (CAJA Municipal de Huancayo)

This research uses public information and represents an analysis of how the capital markets will be considered as an alternative for the microfinance entities in order to obtain better interest rates and new financial alternatives (diversify their capital structure) as well as develop their corporate governance (Bolaños et al., 2014). Peru has been one of the fastest growing Latin American countries in recent years. In microfinance, Peru has achieved considerable growth over time. According to the Interamerican Development Bank (IDB) and Coporación Andina de Fomento (CAF), Peru is a country with the best conditions for microfinance in region of Latin America and the Caribbean. This is reflected, in part, by a larger portfolio of microfinance loans and the best business environment in the region (IDB, 2010). We start by reviewing the history of this industry for the period 2009–2013. This overview will facilitate an understanding of this industry, its development, and the main participants in this sector; then we proceed by exploring the market structure, its nature, its characteristics, and the supply and demand forces, including the competitors and the size of the Peruvian financial sector. Finally, we focus on the process followed by Caja Municipal de Huancayo (CMAC) in order to list bonds and commercial liabilities on the Lima Stock Exchange, taking into consideration the regulation process; finally, the results of the operation are presented, This review will give a better understanding about the process of development for microfinance entities in a volatile macroeconomic context.