MDV: Plans & Initiatives In 2020
· More than RM450.0 million in new financing will be offered to cater for technology companies & projects financing requirements in 2020
· Companies funded by MDV are receiving the attention of other financial institutions due to their growing track records and potential for success
· MDV has commenced preparation for new stand-alone Sukuk programme (Fourth Fund) to ensure viable technology companies and projects will continue to have adequate access to funding
· MDV to focus in 4 key areas in 2020: Digitalisation & ICT; Green Technology; Connectivity; & Startups
KUALA LUMPUR, Feb 26 (Bernama) — Malaysia Debt Ventures Berhad (MDV) today held a Media Briefing to share on MDV’s plans and initiatives for the year 2020. The briefing was held in conjunction with the Company’s Anti-Corruption Pledge ceremony with the Malaysian Anti-Corruption Commission (MACC). Present at the briefing were Chairman of MDV, YBhg. Dato’ Seri Lee Kah Choon and its Chief Executive Officer, Nizam Mohamed Nadzri.
Speaking to the media, Dato’ Seri Lee Kah Choon highlighted that MDV’s role as a technology financier remains relevant and crucial as the country enters a new decade.
“With technology still remaining the game changer for Malaysia in achieving sustainable and equitable growth as articulated in the Shared Prosperity Vision 2030 (SPV2030), MDV remains focused and on track in supporting the growth of technology-based Small and Medium-Sized Enterprises (SMEs), particularly startups, by offering more than RM450.0 million in new financing to cater to their financing requirements in the year 2020,” said Lee.
According to Lee, through MDV’s assistance, some of the underserved technology-based companies that were initially facing difficulties in obtaining funding for their business needs are receiving the attention of other financial institutions due to their growing track records and potential for success.
“Such were the case in 2019, where 8 companies that were receiving MDV’s financing equivalent to RM142.0 million in outstanding loan, were able to access financing from other commercial banks and capital markets with ease and had since been redeemed,” explained Lee. “Although we were reluctant to let these good customers go, it is a positive indication that MDV possesses the required expertise in identifying potentially viable projects to support, through our stringent due diligence processes and detailed assessment of projected performance of the business. I am pleased that financing by MDV has enabled these technology companies to deliver their projects and develop their track record and business credibility.”
Lee further remarked that the issuance of RM270.0 million via an Islamic Medium Term Notes (iMTN) under MDV’s existing RM1.0 billion Sukuk Murabahah Programme (Third Fund) and the AA3 credit ratings assigned by RAM Ratings to MDV last year, had provided MDV with the much-needed impetus for the Company to continue improving its lending traction.
“2019 was a landmark year for MDV as we begin to see the results of our 7-year transformative plan. Corporate credit ratings of AA3-Stable/P1 assigned to MDV has accorded MDV with better access to the capital markets allowing us to raise funds based on our requirements, and we have in fact, commenced preparation to develop our own standalone Sukuk programme (Fourth Fund) in 2020 to ensure that viable technology companies and projects will continue to have adequate access to funding.”
Explaining on MDV’s plans for 2020, Nizam highlighted that MDV has refined its business focus to be more in line with the Government’s current emphasis on sustainable development and technological empowerment as a means to achieve continued economic stability and overall prosperity for the Rakyat.
“In keeping with our mandate, MDV will be looking to continue supporting the nation’s technology agenda in 2020 through portfolio rebuilding initiatives by committing our efforts and resources in developing MDV’s newly-identified key priority areas within the technology sector, namely Digitalisation & ICT; Green Technology, Connectivity and Startups,” said Nizam.
As to date, MDV has financed 897 technology projects with more than RM11.9 billion in financing having been disbursed. In regard to startups, MDV offers a number of programmes to fit their unique requirements, including Venture Financing, the Shariah-compliant equivalent of the Venture Debt models currently used by more developed markets, for high-growth venture capital-backed technology startups in Malaysia. MDV is also currently the only dedicated Energy Performance Contracting (EPC) financier in Malaysia.
“The year 2020 will also see the efforts by the Government in boosting the growth of start-ups and technology-based companies via collaborations/ partnerships between MDV, Cradle and MAVCAP, beginning to materialise as all three agencies are currently working to define the scope and areas of collaborations that can yield optimal outcome to the targeted group by enabling a funding platforms offering grants, equity and debts, for the continued development of the Malaysian technology sector as a whole,” concluded Nizam.
About MDV – The Nation’s Technology Financier
Malaysia Debt Ventures Berhad (MDV) is a wholly-owned subsidiary of the Minister of Finance Incorporated established in 2002 with the objective of providing flexible and innovative financing to develop high-impact and technology-driven sectors of the economy, identified and prioritised by the Government as future engines of growth. MDV’s strategic role in the technology financing ecosystem in Malaysia is defined by its approach to funding which is different from other financial institutions. MDV’s niche is helping to fund young technology-based companies or startups that are unable to secure financing from commercial financial institutions due to their novel business model, lack of proven operating track record and lack of collaterals. With the rapid rate of technological and digital advance, and Malaysia’s continued push towards becoming an advanced nation, MDV will continue to have a significant role to play particularly in financing emerging technology areas and in achieving its vision of becoming the Nation’s Technology Financier.