The two offerings are aimed at scaling high-growth companies and digital platform businesses respectively.
HSBC is launching a $150
million venture debt offering in Singapore and a $1 billion
growth fund for the ASEAN region.
“The new venture debt capability provides a longer-term and
flexible financing solution to companies, supporting a range of
funding requirements such as capital expenditure, runway
extension, and working capital for up to three years in tenor,”
HSBC said.
Venture debt is a type of loan offered by banks and non-bank
lenders which is targeted at early-stage, high-growth companies
with venture capital backing. Venture debt does not replace
equity; it follows it. The amount of venture debt tends to be
calibrated to the amount of equity the company has raised, with
loan sizes varying between 25 per cent and 35 per cent of the
amount raised.
The HSBC ASEAN Growth fund, meanwhile, covers six ASEAN markets –
Indonesia, Malaysia, the Philippines, Singapore, Thailand, and
Vietnam. The fund aims to provide funding to digital platform
businesses including e-commerce players, the bank said in a
statement earlier this week.
“Like so many other internationally-minded businesses, we are
excited about ASEAN’s booming digital economy,” Amanda Murphy,
head of commercial banking for South and Southeast Asia at HSBC,
said. “With a working population that is digitally native,
increasing in size, and poised to consume more goods and services
– especially on e-commerce – ASEAN has so much potential for
growth.”
(In total, there are 10 ASEAN countries. Besides those mentioned
above, the others are Brunei, Cambodia, Laos, and Mynamar.)
