Shares are the most important financial product for Alterfin. The share capital forms the financial basis that enables Alterfin to make investments in the South. In order to mobilise capital, Alterfin offers shares for subscription.
There are two types of Alterfin shares:
- Associations or companies can subscribe to shares of 250 euros
- Individuals can subscribe to shares of 62.50 euros
The prospectus of Alterfin shares was approved by the Authority Financial Services and Markets Authority (FSMA). Click here and find the summary of the prospectus and the risk factors associated with the investment.
Record growth capital
Alterfin’s share capital had a strong growth in 2015: EUR 7.1 million was added to the EUR 43,7 million already acquired at the end of 2014. As at 31 December 2015, Alterfin’s share capital stood at EUR 50.8 million. The total number of shareholders by 31 December 2015 amounted to 5,573 (+571 in 2015).
Individual shareholders account for 95% of the total number and contribute 84.5% of the total share capital.
Appropriation of share capital
The capital of the shareholders is used to finance organisations in the South that for their part grant credit to local farmers and entrepreneurs.
The capital can either be used directly to finance a partner or indirectly. In the last case Alterfin uses the share capital (in Euros) as a guarantee for getting a credit line (in dollars) with our banking partners. This credit line is larger than the share capital, which actually means that we thus create leverage. We then lend the borrowed dollars ourselves to the partners in the South.
The shares constitute a permanent source of funding to the South: as soon as a loan is paid back, the share capital can be reused to finance other groups of people in the South.
Become a coop-member of Alterfin
The coop-members or shareholders of Alterfin are the joint proprietors of the cooperative society. As a coop-member you are therefore both politically and financially involved in Alterfin.
Participation and control
All associates are a member of the General Assembly (GA) that is convened at least once per year. The GA is the highest decision-making body of the society. The GA elects the members of the Board of Directors and gives them a mandate to administer Alterfin. Moreover the GA also decides among other things on the appropriation of the result.
Every associate has examining and control capacity with regard to the financial situation of the society. Fifteen days before every GA the associates receive the annual statement of accounts and the annual report as well as the auditors' report.
As an associate you receive our quarterly newsletter with information on new investments and an update on current dossiers. In short: as an associate you are really involved in our activities and you always keep an overview of what is happening with your money.
Shares are risk-bearing financial products. This means on the one hand that Alterfin cannot guarantee you any return and on the other hand that every associate can be held responsible for possible losses of Alterfin, maximally for the value of his/her shares. In practice this means that the value of the shares will decrease if Alterfin suffers losses.
Providing funding to organisations in the South that work to the benefit of small farmers and entrepreneurs is per definition a risky activity, but it is connected with the social mission of Alterfin. Becoming an associate of Alterfin therefore means a true commitment, for people and organisations who believe in our initiative and who want to make a contribution themselves to enable investments in sustainable development in the South.
As a matter of course Alterfin tries to do everything it can to avoid losses. Our results from the past confirm this concern. This is achieved thanks to the following five measures:
- After having examined the social relevance of the project, we thoroughly analyse the organisations involved from a business economic point of view. For we want that our partners are able to pay back the funding they have received. The analysis of the social and financial component of our investments is carried out by the Credit Committee.
- Our partners must present guarantees for the funding received. If these guarantees are not available Alterfin may request an intervention of the Guarantee Fund.
- Partners are adequately monitored during financing. The monitoring takes place at distance and on the spot.
- Alterfin diversifies its investment portfolio to a large number of partner organisations that are active in various countries and several sectors.
- If things would still go wrong in spite of the thorough prior analysis and the conscientious monitoring during financing, we take specific provisions for the loans that very probably will not be possible to recover or we can use the reserves we have already built up.
Every associate is entitled to vote at the General Assembly (GA). This GA should meet at least once per year during the first five months of the fiscal year (between January 1st and May 31st).
The GA has the power to nominate and dismiss Board members, an auditor and auditing associates. Furthermore the GA should adopt the annual accounts and discharge the Board members and the auditor. The GA should also decide on possible changes of the articles of association and on the dissolution of the society.
The GA can always decide in a legally valid way, irrespective of the number of associates present. Every associate is allowed to be represented by maximum one other associate (by regular written proxy). Every associate is entitled to a number of votes that is equal to the number of shares he or she owns. However no associate is allowed to have more than 10% of the total number of votes present at the GA. This guarantees a democratic decision-making process.
Of course it is possible that you want to recover the capital you have invested in Alterfin. In that case Alterfin will buy your shares back.
Individual shareholders can exit during the first six months of the year (from January 1st to June 30th), for all or part of their shares. Legal entities can only exit during the first three months of the year (from January 1st to March 31st). These periodes are set in our by-laws.
At exit, shares are bought back at the bookvalue of the shares, defined as the nominal value minus accumulated losses and plus accumulated proft. However the exit-value can never be more than the nominal value. To put it in simplier language you will never get more from your shares than you paid for it, but it might be that you obtain less in case of accumulated losses that are not compensated by profits. Alterfin has a policy not to accumulate profit unnecessarely and to pay dividend whenever there is profit.