Social Investment Funds

INVESTORS REPORTThird Quarter 2012www.globalpartnerships.org

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Jason Henning, Director of Investor Relations

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| Letter from the CIOO |

Innovation is risky. Innovation across multiple dimensions in order to pioneer new business models serving the BoP (bottom of the pyramid) is especially risky.

(Monitor Group, From Blueprint to Scale: The Case for Philanthropy in Impact Investing)

11 COUNTRIESwhere Global Partnerships works

33 PARTNERSwith whom Global Partnerships works

97,527 PEOPLEserved by Global Partnerships through our partners

$42.2 MILLIONfund capital at work

“ ”

Global Partnerships | Q3 FY2012 | As of September 30, 2012 | Page 2

BY THE NUMBERSas of September 30, 2012

November 15, 2012

As the impact investment industry gains steam and attracts billions of dollars in capital, key actors are asking what role philanthropy and other types of social capital play in advancing the sector.

While the impact investing field has drawn large amounts of capital seeking risk-adjusted market-rate returns, a mismatch has developed between return expectations of available capital and the type needed to pioneer successful global development. We at Global Partnerships hold the view that multiple types of capital are required to solve the social challenges facing the world’s poor.

For this reason, we apply a range of capital to meet the needs of our partners in Latin America and the Caribbean. Our social investment funds, in which you have invested, scale proven strategies that help impoverished people increase incomes and improve their lives.

We have begun to complement our fund investments with philanthropic grant funds aimed at helping some of our partners develop innovative, market-sustained business models that deliver essential goods and services to impoverished communities. We know that the provision of small, working capital loans can be done sustainably; we see the same promise in the delivery of non-financial services, including preventive health education and “green” technologies such as solar lights and efficient cook stoves.

Global Partnerships is currently making grants from our Health Services Fund, an effort designed to demonstrate how microfinance institutions and cooperatives can be leveraged as distribution platforms for preventive and primary health care solutions on an economically sustainable basis. This is an innovative idea, but it carries additional risk, and thus it is more appropriate to use philanthropic resources rather than our social investment funds to advance this work.

We recently launched the learning phase of our Green Technology Fund, aimed at providing affordable, accessible green technologies that save households money and time, improve living conditions and reduce environmental footprint. A combination of grants and loans may be the best option to help provide partners with the risk capital needed to scale a pilot program.

Global Partnerships is achieving important synergies with its key partners by providing a combination of loan capital for less risky investments and grants or other more philanthropic capital for earlier stage projects that involve greater risk. Our strategy in doing this is to deepen our engagement with high-performing partners dedicated to integrated service delivery.

Mark Coffey, Chief Investment and Operating Officer

| Microfinance Fund 2008 |

Global Partnerships | Q3 FY2012 | As of September 30, 2012 | Page 3

Fund Manager’s Comments

Partner performance remains strong and all partners in the Fund continue to make principal and interest payments in a timely manner. Generally speaking partners have shown responsible growth, consistent balance sheet strength, and strong portfolio quality. GP continues to optimize the social and financial performance of the Fund through ongoing renewals and reinvestments. During the third quarter the Fund’s loan to Fubode was repaid, and along with funds from late second quarter maturities GP deployed a combined $3.8 million to three existing partners and one new partner, Friendship Bridge. With this new investment GP is pleased to announce its reentry into Guatemala. Friendship Bridge is a microfinance institution that provides small working capital loans through a group lending methodology to women in mostly rural areas. In addition to credit Friendship Bridge provides clients with education focused in health, business, agriculture and self-esteem. With roughly two years until the Fund matures and several renewals scheduled for the last quarter of 2012, GP remains hard at work identifying and maintaining mission-aligned partners.

October 31, 2008Inception Date

$20,534,960Capital Invested as of 09/30/12

$20,000,000Total Fund Capital

17 $663 82% 48%

Fund Manager Global Partnerships

Investment CurrencyUS$ and fully hedged local currency

Type of FundDebt

Fund Facts

Social Impact

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 %

FY09 FY10 FY11 FY12

FY09 FY10 FY11 FY12

FY09 FY10 FY11 FY12

FY09 FY10 FY11 FY12

FY09 FY10 FY11 FY12

Outstanding number of partners

Average loan size

Percentage of borrowers served who are women

Percentage of borrowers served living in rural areas

100

200

300

400

500

300

400

500

600

700

90

120

150

02468

10

0

1

2

3

4

| Social Investment Fund 2010 |

Global Partnerships | Q3 FY2012 | As of September 30, 2012 | Page 4

Fund Manager’s Comments

GP has remained active with due diligence and new disbursements with SIF 2010 during the third quarter. All partners continue to make principal and interest payments in a timely manner. As of September 30, the Fund’s outstanding loan balance was $23.4 million deployed to twenty five mission-aligned organizations in nine countries across Latin America and the Caribbean. The Fund continues to have investment opportunities as a result of regularly scheduled amortizations and repayments. During the third quarter the Fund disbursed a combined $3.1 million to three new partners: ADRA in Peru, Los Andes in Peru, and CONSERVA in Mexico, and one existing partner, Crediflorida in Peru. CONsultores de SERvicios VArios (CONSERVA) is a microfinance institution (MFI) that utilizes the solidarity group methodology to provide small working capital loans and health services to entrepreneurs living in poverty. The organization concentrates its services on the lower segments of the market, serving nearly 100% women in rural, urban, and peri-urban areas in the southeast region of the country. GP is proud to welcome CONSERVA into its portfolio of high performing partners within its Health Services impact area.

October 21, 2010Inception Date

$23,444,114Capital Invested as of 09/30/12

$25,000,000Total Fund Capital

25 $735

81%

48%

Fund Manager Global Partnerships

Investment CurrencyUS$ and fully hedged local currency

Type of FundDebt

Fund Facts

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 %

FY11 FY12

FY11 FY12

FY11 FY12

FY11 FY12

FY11 FY12

Outstanding number of partners

Average loan size

Percentage of borrowers served who are women

Percentage of borrowers served living in rural areas

Social Impact

0

200

400

600

800

90

120

150

0

1

2

3

4

0100200300400500600

0

1

2

3

4

Outstanding PositionsDistribution by Institution and Country

BOLIVIA (25%)CRECER (10%)Pro Mujer in Bolivia (10%)FONDECO (5%)

BOLIVIA (17%)Pro Mujer in Bolivia (5%)Sembrar Sartawi (5%)CRECER (4%)FONDECO (3%)

ECUADOR (30%)FINCA Ecuador (10%)FODEMI (10%)Banco D-MIRO (5%)Fundación Alternativa (3%)Fundación Faces (2%)

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

EL SALVADOR (5%)ENLACE (5%)

EL SALVADOR (10%)Fundación Campo (6%)ENLACE (4%)

GUATEMALA (1%)Friendship Bridge (1%)

HONDURAS (5%)COMIXMUL (5%)

MEXICO (9%)FRAC (2%)Pro Mujer in Mexico (7%)

MEXICO (10%)CONSERVA (4%)FRAC (4%)Pro Mujer in Mexico (2%)

DOMINICAN REPUBLIC (1%)Esperanza (1%)

NICARAGUA (15%)FDL (10%)Pro Mujer in Nicaragua (5%)

NICARAGUA (2%)Pro Mujer in Nicaragua (2%)

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

PERU (30%)ADRA (4%) Pro Mujer in Peru (8%)Crediflorida (7%)Los Andes (2%)NORANDINO (3%)Arariwa (3%)FONDESURCO (2%)APROCASSI (1%)

COLOMBIA (12%)Fundación Amanecer (6%)Contactar (6%)

CASH (1%)

CASH (3%)

Microfinance Fund 2008Percent of investable assets

Social Investment Fund 2010Percent of investable assets

Global Partnerships | Q3 FY2012 | As of September 30, 2012 | Page 5

| |

5% El Salvador

5% Honduras

2% Nicaragua

1% Cash

3% Cash

1% DominicanRepublic

1% Guatemala

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

17% Bolivia

12% Colombia

10% Ecuador

10% El Salvador

10% Mexico

30% Peru

25% Bolivia

30% Ecuador

9% Mexico

15% Nicaragua

14% Peru

| Partner Organization Profile: IDEPRO |

According to the World Bank, roughly 60% of the Bolivian

population lives below the national poverty line with roughly

a quarter of the population living on less than two dollars a

day. Due to historic marginalization, women and indigenous

populations are disproportionately affected. Poverty tends to be

concentrated in rural areas where low agricultural productivity,

lack of infrastructure and limited access to markets leaves nearly

80% of the rural population living below the national poverty

line.

Fortunately, Global Partnerships’ partner IDEPRO, a nonprofit microfinance institution (MFI), is providing opportunity to thousands of rural and underserved clients throughout Bolivia with credit and education services. IDEPRO’s pioneering approach differs from other traditional MFIs: the organization tailors its credit products to serve small associations of farmers, indigenous community associations and producer cooperatives that play an important role in the value chains they serve.

An example of IDEPRO’s work can be found in the way they provide capital to and connect various actors along the timber value chain. IDEPRO works with indigenous communities who are authorized by the Bolivian government to harvest wood in a sustainable manner from designated forest areas. Without access to affordable credit from IDEPRO, these communities would not have the working capital needed to utilize their designated areas of forest, meaning that workers would have to request cash advances from sawmills, giving leverage to the sawmills to negotiate wood prices.

Furthermore, IDEPRO provides technical assistance to indigenous communities that allows them to develop trading skills, prepare financial statements, and obtain and fulfill the legal requirements necessary for wood harvesting. After a group is organized, IDEPRO provides the community with a working capital loan, providing representatives of the communities with the opportunity to negotiate on an equal level with the sawmills. IDEPRO also provides financial credits to sawmills if they agree to formalize their relationships with communities in which the conditions to trade wood are clearly defined. Additionally, when the wood is delivered to the sawmills, IDEPRO’S loan payments are discounted.

IDEPRO’s strategy is beneficial to all parties involved: communities have access to better prices for their products; sawmills have access to capital with preferential interest rates and reliable wood suppliers; and IDEPRO has minimized its credit risk. In addition to timber products, IDEPRO also serves value chains focused on brazil nuts, quinoa, grapes and wine. We are proud to invest in a partner that is increasing incomes and improving lives for thousands of underserved Bolivians.

BoliviaCountry

1991Year founded

143Number of

employees

7,803Active borrowers

$26,269,578Outstanding gross loan portfolio

$3,367Average loan size

34%Percent women

45%Percent rural

Global Partnerships | Q3 FY2012 | As of September 30, 2012 | Page 6

Caption: Two IDEPRO members take a break from processing raw quinoa grain. Photo courtesy of IDEPRO.