A MESSAGE FROM THE CHAIRMAN

OF THE BOARD

Dear Shareholders and Employees:
It is with great pleasure that I greet and address you at the end of this my first year as Chairman of the Board of Directors, especially since 2013 was a year of evolution for our company. Thanks to your support, dedication, and passion, we have now begun a new stage as Gentera.

The very letters of the name of Gentera evoke what we are and what we strive to be: the GENe that GENerates opportunities so that the entire community can participate in the benefits of development.

The name Gentera evokes and calls upon GENuine, GENtle and GENerous people to join in a common purpose: to eradicate financial exclusion in the Americas. Our people are moved by strong ethical principles and committed to providing friendly, convenient, and quality service. Our Philosophy is focused, as it has been since our beginnings, on people.

Through this evolution, we have given shape to our corporate strategy: to be a multi-product and multi-country company. We have given independence to each of our businesses and positioned the operating companies (Compartamos Banco, Compartamos Financiera, Compartamos S.A., Yastás, and Aterna) and the holding company in different ways.

As a result, our organizational structure has been renewed and strengthened to meet the new circumstances and challenges of our market. Nevertheless, our Philosophy remains the essence of our growth and the principal element that sets us apart in the countries where we operate.

In Mexico in 2013 we focused on increasing the convenience of our services through Yastás, on improving quality standards and internationalization at Aterna, and on technological renovation at Compartamos Banco. This included the set up of Integra –the bank’s new technological platform– and of ECO –a localization and field data digitalization system– and helped us to close out the year with 96,918 savings accounts.

The Client Protection Index (known as IPAC by its Spanish-language acronym) permeated the operations of Compartamos Banco, consolidating an internal monitoring system that allows us to measure levels of compliance with our seven principles of client protection, based on the international initiative Smart Campaign.

In Guatemala we maintained solid growth. We consolidated our position and set our brand apart through the expansion of Crédito Mujer, the offer of life insurance to clients, and the training of employees to provide financial education.

In Peru, we succeeded in integrating our Philosophy and our Values with the team of Financiera Crear, now Compartamos Financiera. We also enhanced operations through the introduction of Crédito Súper Mujer, even as we continued to make the most of our Peruvian experience in the area of individual credits in order to perfect this methodology in Mexico.

The results have been positive. In 2013 we reached 2,754,860 clients through our Compartamos companies in Mexico, Guatemala, and Peru, along with a total of 3,171 correspondents affiliated with Yastás and more than 3.4 million active insurance policies with Aterna. In Peru and Guatemala we doubled the number of our branches.

Our total loan portfolio amounted to 20,706 million pesos at the end of 2013, compared to 18,161 million pesos the previous year, representing growth of 14.0%. The average bank balance in Guatemala and Mexico increased slightly, though it decreased in Peru. The non-performing loan ratio for the year was 3.12%, lower than the average ratio of the microfinance sector in the countries where we operate. These figures bear witness to the coherence and strength of our business model.

The creation of social, economic, and human value in the communities where we work is to be found in every action we carry out. As we have done since 2009, we earmarked 2% of earnings into the social development of the communities that have welcomed us.

Through Fundación Gentera and our Social Responsibility programs, some 40.2 million pesos was earmarked to the benefit of more than 244,000 people in Mexico, Guatemala, and Peru.

Under the umbrella of the Compartamos con la Familia Open Call, fourteen social organizations were benefitted, impacting more than 10,000 people all over Mexico. There were 26 Compartamos con la Comunidad Days held in Mexico and two in Guatemala. Also, 14,328 Gentera employees and their family members participated in volunteer activities during these community service days.

We are convinced that informed financial decisions contributed to people’s family and professional wellbeing. This is why we put special emphasis on financial education in 2013. We worked with our employees, clients, and the community to provide them with the necessary tools in this area, training some 203,000 people in the course of the year.

All of these results have been achieved through the work of the employees who maintain their commitment to Gentera and to its clients on a daily basis. In 2013 we increased the total number of employees who support the operation of Gentera and its companies by 16.5%, bringing the year-end total to 19,339.

The current business environment in Mexico, Guatemala, and Peru is characterized by the stability of the main economic variables, access to funding, and economic growth. The competiveness of the sector has grown rapidly in all three countries, demanding constant renovation on our part in order to offer better quality products and services.

Going forward, we are focused on consolidating our strategy, completing the implementation of Compartamos Banco’s technological platform, developing new products, consolidating our model of Yastás correspondents, increasing the number of insurance policies through more distribution channels, and strengthening our operations in Guatemala and Peru. In synthesis, we seek to increase the number of clients we serve with quality and friendliness, thereby reaching more people in the least possible time.

Carlos Danel Cendoya
Chairman of the Board of Directors