StanChart on track to lend microlenders $500 mln

LONDON, June 4 (Reuters) - Asia-focused bank Standard Chartered (STAN.L: Quote, Profile, Research) is on track to lend $500 million to microlenders, or banks for the poor, helping an industry hit by funding problems as a result of the financial crisis.

"We are on target," Finance Director Richard Meddings said about the bank's pledge, made in September 2006, to lend the sum over five years.

A majority of microfinance institutions said they had faced liquidity constraints over the previous six months in a March survey by by microfinance industry body the Consultative Group to Assist the Poor.

Microfinance -- which typically provides loans to small entrepreneurs whom traditional lenders consider too risky -- has grown rapidly in recent years, but the credit crisis has crimped the ability of mainstream commercial lenders and some donors to fund microlenders. [nLL311970]

Standard Chartered has steered a clearer path through the financial crisis than most rivals and Meddings said its decision to lend to microfinance institutions was a commercial one rather than purely an issue of social responsibility.

"It's a sustainable business for banks and it's an important contribution to the markets in which we are the leading bank," he said in an interview after a conference on sustainable banking.

"If you don't have a business that is in itself sustainable, the rest won't happen," he added.

(Reporting by Olesya Dmitracova; Editing by Hans Peters)

((olesya.dmitracova@thomsonreuters.com; +44 20 7542 8051; Reuters Messaging: olesya.dmitracova.reuters.com@reuters.net)) Keywords: STANCHART/MICROFINANCE

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