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The Microfinance Contagion Scenario

Harvard Business Review

But as information trickles out about how bad the repayment situation in AP is, a plausible global contagion scenario is emerging. Losses in AP will overwhelm many institutions' equity cushion. The average debt-to-equity ratio of the 10 largest MFIs in India is 7.06 , indicating an average 12% equity cushion.

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End the Religion of ROE

Harvard Business Review

Return-on-equity hurdles threaten them all. Conversely, why market cigarettes? In their pursuit of margin, marketers sought market power even to the point of monopoly, requiring antitrust laws to cry stop at the last moment of the end game. Second, an innovation should have the widest possible market.

ROE 13