Oikocredit looks forward to 2023 with a new capital-raising model
Oikocredit is planning to introduce its new capital-raising model on 1 March 2023, to allow any eligible organisations and individuals to invest directly in the cooperative.
Investors across Oikocredit’s active markets will soon be able to buy and hold the same investment product, which will be a non-voting equity instrument issued by Oikocredit, called a participation.
Participations will become available to various investor groups in phases. Eventually they will completely replace both the shares that Oikocredit currently issues only to cooperative members, and the other investment products that are derived from such member shares but issued by Oikocredit’s support associations and Stichting Oikocredit International Share Foundation (OISF).
Efficient, resilient and impactful model
The introduction of participations will result in a simpler and more direct way for individuals and organisations to invest in Oikocredit. The new model is expected to be more resilient in the face of evolving financial markets regulation, especially in the European Union.
Furthermore, by offering a single product (i.e. the participation), Oikocredit’s capital-raising work will be more efficient. This will allow the cooperative to invest more resources in partnerships and projects that benefit low-income communities, and in promoting sustainable development together with its global network of investors, members and partners.
Changes to begin on 1 March 2023
Oikocredit’s members resolved to amend Oikocredit’s articles of association enabling the implementation of the new capital-raising model during an Extraordinary General Meeting on 14 October 2022.
Once the required responses from regulators have been received, Oikocredit’s Managing Board intends to effectuate this amendment and begin implementing the new model as of 1 March 2023. This is a slight change from the originally anticipated implementation date of 1 January 2023. The new date allows the cooperative to align the timing of these changes more closely across its various active markets and audiences.
Starting as of 1 March 2023, Oikocredit will gradually convert its outstanding member shares into participations. This means that for all investment products derived from member shares and issued by Oikocredit’s support associations and OISF, the underlying product will change from a member share to a participation.
Members of Oikocredit will be able to invest directly in participations starting 1 March 2023, with other investor groups following in the months thereafter. Investors will be directly notified before any changes take place.
Support associations stand strong amidst changes
With the introduction of participations, investors will no longer invest via the support associations, which currently offer investment products derived from member shares to investors.
Notwithstanding these changes, all support associations will continue to promote Oikocredit’s mission in their regions, nurture local communities of investors and inform them about the work of Oikocredit and its partners. They will also continue promoting education on sustainable development together with Oikocredit and serve as the voice of their members.
Oikocredit looks forward to 2023 and the planned implementation of the new capital-raising model.
Investors can read more about the upcoming changes on their country website(s). Oikocredit’s members can read more here and in the supplement to the cooperative’s member shares prospectus.
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