Social Investment Funds

INVESTORS REPORTThird Quarter 2013 | July 1 - Sept. 30, 2013

www.globalpartnerships.org

1932 First Avenue, Suite 400 | Seattle, WA 98101, USA | 206.652.8773 // De Enitel Villa Fontana 2c. Este, 30v. Norte | Edificio Opus Of. 205 | Managua, Nicaragua

Photo: A MiCrédito client peels beans by the light of a solar-

powered lamp. © Global Partnerships 2013.

For more information, contact:

Jason Henning, Director of Investor Relations

jhenning@globalpartnerships.org | 206.456.7832

Featuring: New partner MiCrédito on p.8

Online: See all partner profiles here

| Letter from the CIOO |

11 COUNTRIESwhere Global Partnerships works

39 PARTNERSwith whom Global Partnerships works

122,608 PEOPLEserved by Global Partnerships through our partners

$52.3 MILLIONfund capital at work

Global Partnerships | Q3 2013 | As of Sept. 30, 2013 | Page 2

BY THE NUMBERS

November 15, 2013

Dear Investor,

Since the launch of Global Partnerships’ (GP) first social investment fund in 2005, we have provided debt financing to social enterprises with the objective of expanding already-proven solutions that help people living in poverty increase their incomes and improve their lives. Two examples of this approach are scaling access to microcredit for underserved entrepreneurs and pre-harvest finance for smallholder farmers.

Yet, our team is increasingly discovering business models that have potential to create significant impact in the lives of the poor, but have not reached sustainability, or represent levels of risk our investment funds aren’t designed to absorb.

However, as a mission-led nonprofit impact investor, we are working hard to be catalytic with all of our capital. This means becoming creative with credit enhancement as well as building our capacity to deploy all types of capital to meet our partners’ needs.

For example, during due diligence for an investment to Fonkoze, a Haitian microfinance institution, it became clear that the organization would not meet our credit criteria for our investment fund. Yet, since we believed strongly in Fonkoze’s approach to integrating credit with business education and health services, we secured guarantors to cover payment defaults for the full loan amount. While we fully expect to recoup the loan, the guarantees allowed us to extend growth capital to a partner with exceptional social performance working in a very difficult geography.

In addition to loan capital, GP is also providing knowledge and grant capital to Fonkoze, in order to help them develop a model of health education and services that could operate sustainably. We hope this will benefit Fonkoze’s clients and strengthen the institution, which would help improve the repayment outlook on our loan.

Furthermore, we worked with Fonkoze and SAFICO, a solar distributor, to develop a unique distribution model to deliver solar lights to non-electrified households in rural Haiti. Through this partnership, leaders of Fonkoze’s borrowing groups (center chiefs) serve as resellers of solar products to remote (last mile) communities. The initiative is still in the early stages, but we have delivered a targeted grant to support their marketing efforts, addressing the issue of lack of awareness about solar technologies.

Loan capital for more mature businesses, and loans combined with knowledge and grant capital for new or struggling—yet promising— initiatives provide a “capital package” that enables good management teams to overcome the common obstacles to development. This type of targeted approach to capital positions us to have a greater social impact in the future.

Thank you for your ongoing interest in and support of our work.

Mark Coffey Chief Investment and Operating Officer

| Microfinance Fund 2008 |

Global Partnerships | Q3 2013 | As of Sept. 30, 2013 | Page 3

Fund Manager’s Comments

Partner performance remains strong and all entities in the Fund continue to make principal and interest payments in a timely manner. Generally speaking, partners continue to show responsible growth, expected earnings, and consistent balance sheet strength. With only a year until it matures, GP conducted one partner loan renewal and one loan extension during the third quarter and deployed additional short-term capital to two existing partners. Through prudent fiscal management, GP has been able to transform the Fund’s original capital commitments of $20 million into over $21 million in investments, thus improving both the financial and social performance of the fund.

October 31, 2008Inception Date

$21,069,250Capital Invested

$20,000,000Total Fund Capital

17 $730 80% 48%

Fund Manager Global Partnerships

Investment CurrencyUS$ and fully hedged local currency

Type of FundDebt

Fund Facts

Social Impact

Current number of partners

Average loan size

Percentage of borrowers served who are women

Percentage of borrowers served living in rural areas

In thousandsTOTAL BORROWERS SERVED

300400500600

800

700

FY09 FY10 FY11 FY12 FY13

2008

90

120

150

Total revenues/total expenses as a %

AVERAGE OPERATIONALSELF SUFFICIENCY

FY09 FY10 FY11 FY12 FY13

Loans past due greater than 30 days as a %AVERAGE PAR >30

02468

10

FY09 FY10 FY11 FY12 FY13

Asset amount charged to loss as a %AVERAGE WRITEOFFS

0

1

2

3

4

FY09 FY10 FY11 FY12 FY13

US dollars in millionsTOTAL PARTNER LOAN PORTFOLIO

100

200

300

400

500

600

FY09 FY10 FY11 FY12 FY13

GROWTH

PARTNER PORTFOLIO QUALITY

TOTAL PARTNER LOAN PORTFOLIOUS dollars in millions

TOTAL BORROWERS SERVEDIn thousands

AVERAGE OPERATIONAL SELF SUFFICIENCYTotal revenues/total expenses as a %

AVERAGE PAR > 30Loans past due greater than 30 days as a %

AVERAGE WRITEOFFSAsset amount charged to loss as a %

| Social Investment Fund 2010 |

Global Partnerships | Q3 2013 | As of Sept. 30, 2013 | Page 4

Fund Manager’s Comments

Social Investment Fund 2010’s (SIF 2010) performance remains strong with all partners continuing to make principal and interest payments in a timely manner. SIF 2010 continues to have investment opportunities as a result of regularly scheduled amortizations and repayments. During the third quarter the fund renewed or disbursed roughly $2.4 million in fund loans to existing partners, and disbursed an additional $450,000 to two new partners, MiCrédito and Fonkoze. MiCrédito is a Nicaraguan microfinance institution (MFI) that is committed to using the microfinance channel to unlock rural access to green technologies (see profile on page 8), while Fonkoze is a Haitian organization that provides a range of financial, educational and health services to marginalized and underserved members of society (see CIOO letter on page 2).

October 21, 2010Inception Date

$21,329,090Capital Invested

$25,000,000Total Fund Capital

31 $877

77%

51%

Fund Manager Global Partnerships

Investment CurrencyUS$ and fully hedged local currency

Type of FundDebt

Fund Facts

Current number of partners

Average loan size

Percentage of borrowers served who are women

Percentage of borrowers served living in rural areas

Social Impact

In thousandsTOTAL BORROWERS SERVED

0200400600800

1000

FY11 FY12 FY13

Total revenues/total expenses as a %

AVERAGE OPERATIONALSELF SUFFICIENCY

90

120

150

FY11 FY12 FY13

Loans past due greater than 30 days as a %AVERAGE PAR >30

0

1

2

3

4

FY11 FY12 FY13

Asset amount charged to loss as a %AVERAGE WRITEOFFS

0

1

2

3

4

FY11 FY12 FY13

US dollars in millionsTOTAL PARTNER LOAN PORTFOLIO

FY11 FY12 FY130

200

400

600

800

GROWTH

PARTNER PORTFOLIO QUALITY

TOTAL PARTNER LOAN PORTFOLIOUS dollars in millions

TOTAL BORROWERS SERVEDIn thousands

AVERAGE OPERATIONAL SELF SUFFICIENCYTotal revenues/total expenses as a %

AVERAGE PAR > 30Loans past due greater than 30 days as a %

AVERAGE WRITEOFFSAsset amount charged to loss as a %

| Social Investment Fund 5.0 |

Global Partnerships | Q3 2013 | As of Sept. 30, 2013 | Page 5

Fund Manager’s Comments

The third quarter of 2013 was busy with due diligence and new disbursements as the deployment of Social Investment Fund 5.0 (SIF 5.0) picks up speed. At quarter end, the fund had deployed $9.7 million to eight mission-aligned partners in five countries. Five additional loans have been approved and are in the documentation stage, while GP’s team remains busy at work building a robust pipeline of high performance partners. The next capital call for approximately $1.8 million is scheduled to occur in late November. SIF 5.0 currently has $33.45 million in commitments from 34 impact investors and will continue to accept new commitments as it scales to meet its target fund size of $50 million.

March 25, 2013Inception Date

$9,700,000Capital Invested

$15,950,000Total Fund Capital

8 $1,386

69%

51%

Fund Manager Global Partnerships

Investment CurrencyUS$

Type of FundDebt

Fund Facts

Current number of partners

Average loan size

Percentage of borrowers served who are women

Percentage of borrowers served living in rural areas

Social Impact

In thousandsTOTAL BORROWERS SERVED

04080

120160200

FY13

2008

90

120

150

Total revenues/total expenses as a %

AVERAGE OPERATIONALSELF SUFFICIENCY

FY13

2008AVERAGE PAR >30Loans past due greater than 30 days as a %

0

2

4

6

8

10

FY13

Asset amount charged to loss as a %AVERAGE WRITEOFFS

0

1

2

3

4

FY13

US dollars in millionsTOTAL PARTNER LOAN PORTFOLIO

0

60

120

180

240

300

FY13

GROWTH

PARTNER PORTFOLIO QUALITY

TOTAL PARTNER LOAN PORTFOLIOUS dollars in millions

TOTAL BORROWERS SERVEDIn thousands

AVERAGE OPERATIONAL SELF SUFFICIENCYTotal revenues/total expenses as a %

AVERAGE PAR > 30Loans past due greater than 30 days as a %

AVERAGE WRITEOFFSAsset amount charged to loss as a %

Outstanding PositionsDistribution by Institution and Country

Global Partnerships | Q3 2013 | As of Sept. 30, 2013 | Page 6

| |

Microfinance Fund 2008Percent of investable assets

Social Investment Fund 2010Percent of investable assets

Note: All percentages have been rounded to the nearest whole number.

BOLIVIA (23%)CRECER (9%)Pro Mujer in Bolivia (9%)FONDECO (5%)

ECUADOR (28%)FINCA Ecuador (9%)FODEMI (9%)Banco D-MIRO (5%)Fundación Alternativa (3%)Fundación Faces (2%)

EL SALVADOR (5%)ENLACE (5%)

GUATEMALA (3%)Friendship Bridge (3%)

MEXICO (10%)Vision Fund Mexico (3%)Pro Mujer in Mexico (7%)

NICARAGUA (14%)FDL (9%)Pro Mujer in Nicaragua (5%)

PERU (14%)Credivisión (6%)Pro Mujer in Peru (6%)Arariwa (2%)

CASH (1%)

BOLIVIA (17%)Sembrar Sartawi (5%)IDEPRO (6%)CRECER (1%)FONDECO (2%)EMPRENDER (3%)

COLOMBIA (10%)Fundación Amanecer (4%)Contactar (6%)

DOMINICAN REPUBLIC (1%)Esperanza (1%)

ECUADOR (10%)ESPOIR (4%)Banco D-MIRO (3%)Fundación Faces (3%)

EL SALVADOR (6%)Fundación Campo (4%)ENLACE (2%)

HAITI (1%)Fonkoze (1%) NEW

HONDURAS (1%)COMIXMUL (1%)

MEXICO (8%)CONSERVA (4%)Vision Fund Mexico (3%)Pro Mujer in Mexico (1%)CESMACH (<1%) Triunfo Verde (0%)

NICARAGUA (5%)Aldea Global (0%) FDL (2%)MiCrédito (1%) NEW Pro Mujer in Nicaragua (2%)

PERU (27%)ADRA (4%) Pro Mujer in Peru (5%)Crediflorida (5%)Los Andes (3%)NORANDINO (6%)Arariwa (2%)APROCASSI (2%)

CASH (14%)

1% Cash

5% El Salvador3% Guatemala

23% Bolivia

28% Ecuador

10% Mexico

14% Nicaragua

14% Peru

1% Dominican

Republic

5% Nicaragua

1% Honduras

17% Bolivia

10% Colombia

10% Ecuador

6% El Salvador

1% Haiti

8% Mexico

27% Peru

14% Cash

Outstanding PositionsDistribution by Institution and Country

Global Partnerships | Q3 2013 | As of Sept. 30, 2013 | Page 7

| |

BOLIVIA (10%)FONDECO (7%)PRO RURAL (3%) NEW

COLOMBIA (10%)Fundación Amanecer (10%)

ECUADOR (30%)Banco D-MIRO (13%)ESPOIR (10%)Fundación Alternativa (7%)

EL SALVADOR (7%)Fundación Campo (7%)

HONDURAS (8%)COMIXMUL (8%)

CASH (36%)

All FundsPercent of invested assets

Note: All percentages have been rounded to the nearest whole number.

BOLIVIA (21%)

COLOMBIA (8%)

DOMINICAN REPUBLIC (<1%)

ECUADOR (25%)

EL SALVADOR (6%)

GUATEMALA (1%)

HAITI (<1%)

HONDURAS (3%)

MEXICO (9%)

NICARAGUA (9%)

PERU (19%)

Social Investment Fund 5.0Percent of investable assets

10% Bolivia

36% Cash

7% El Salvador8% Honduras

10% Colombia

30% Ecuador

8% Colombia

<1% Haiti

<1% Dominican

Republic 3% Honduras

1% Guatemala

19% Peru

9% Nicaragua

21% Bolivia

25% Ecuador

9% Mexico

6% El Salvador

In Nicaragua more than 2.4 million people are living below the poverty line and roughly 56% of rural households lack access to electricity.

| Featured Partner: MiCrédito |

Global Partnerships | Q3 2013 | As of Sept. 30, 2013 | Page 8

WHO MiCrédito is a Nicaraguan microfinance institution (MFI) providing working capital loans to microentrepreneurs, many of whom live in hard-to-reach rural communities. Witnessing first-hand the challenges of living without electricity, MiCrédito is committed to using the microfinance channel to unlock access to green technologies.

WHAT Through a combined investment of knowledge, grant and debt capital, GP is enabling MiCrédito to turn their commitment into a reality. With market intelligence, in-field support, introductions to key distributors and funds to hire dedicated staff, GP has helped MiCrédito design a program that enables families to cover the upfront costs of bringing clean electricity into their homes. The program also innovates to fund “last mile” resellers–clients who create businesses by purchasing solar products in bulk and then reselling them in their communities. With a recent loan from GP’s SIF 2010, MiCrédito is now piloting the program and aims to reach over 1,600 families in the first two years.

WHY GP is invested in MiCrédito because the organization is committed to delivering appropriate and affordable solar lighting products to high-need, underserved communities in a market-sustained way. Once in the home, the products offered by MiCrédito enable cost savings, increased productivity, and improved health across the family. In addition to these benefits, there is the environmental impact of decreased emissions as well as the livelihoods created by the reseller model. If MiCrédito’s pilot is successful, GP believes the model is one that could be replicated by other MFIs working in rural communities that lack access to basic electricity.

Country: NicaraguaYear Founded: 2004

Number of Employees: 57Number of Borrowers: 5,358 Outstanding Loan Portfolio: $4,939,421Average Loan Size Per Borrower: $921Percent Rural: 35%

A MiCrédito client is able to extend her day and continue working after sunset, thanks to her solar-powered light. © Global Partnerships 2013.

Click to see all partner profiles online.