After a hectic Easter period on the ex-Japan Asian securitization scene, activity slowed last week. Behind the scenes, however, bankers continue to finalize details on upcoming deals as well as hunt new business.
In Singapore, the first steps were taken towards establishing a securitization program aimed at helping small and medium sized entities raise funds. SPRING, the government body in charge of assisting these entities, and DBS Bank, its advisor on the project, launched the SME Access Loan product, which will benefit 300 small companies.
Over the next six months, DBS and SPRING will originate around S$300 million ($182.6 million) in loans. Initially, DBS will provide a bridging warehouse facility to a special purpose company – SME Credit Assist – to finance the scheme, which will ultimately be repaid by ABS paper backed by loan repayments from the entities.
No doubt swayed by the successful marketing strategy employed by the Hong Kong Government on last years HK$6 billion tunnels deal (see ASR 4/26/04), the SPRING deal was launched to great fanfare at a press conference staged in one of the city’s swankest hotels. The parties involved also started an advertising campaign in local newspapers and radio stations to raise publicity and attract more small-to-medium sized entities to participate.
“The SME ACCESS Loan program will benefit SMEs, in particular those with little collateral or limited track record, and those seeking financing for internationalization purposes,” remarked Cedric Foo, Minister of State for Defense and National Development, as well as chairman of SPRING.
“We believe this scheme offers a unique funding proposition that gives the underserved SME segment easier access to the capital markets, which remains closed to most smaller entities,” added Edwin Khoo, head of the enterprise-banking group at DBS.
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