ADB, Maxwealth Sign CNY1 Billion Deal to Expand MSME Access to Lease Financing in PRC

BEIJING — The Asian Development Bank (ADB) and Maxwealth Financial Leasing Co., Ltd. (Maxwealth) have signed a CNY1 billion (equivalent to $140 million) senior loan to support lease financing for micro, small, and medium-sized enterprises (MSMEs) and spur inclusive growth and job creation in the People’s Republic of China (PRC).

The loan comprises CNY500 million from ADB and a CNY500 million syndicated local currency complementary loan with ADB acting as the Mandated Lead Arranger and Bookrunner (MLA/B). The Participants in the complementary loan are OCBC Wing Hang and Fubon Bank as MLA/B, CTBC Bank Shanghai Branch as MLA, and Bank Sinopac as MLA and Participation Agent. The financing will enable Maxwealth to provide lease finance for more MSMEs and will focus on MSMEs in the PRC’s underdeveloped central and western regions.

“Smaller businesses face barriers to access financing, despite their crucial role in promoting economic growth and creating new jobs,” said ADB’s Private Sector Operations Department Director General Suzanne Gaboury. “Mobilizing private capital is vital to allow the sector to expand and local currency financing is particularly effective as it lowers foreign exchange risks and financing costs while catalyzing the local capital market. By providing better access to financing, this assistance will support job creation and economic development, particularly in the country’s central and western regions.”

Finance leasing is particularly well suited to small-sized businesses, especially for financing the purchase of equipment. ADB’s assistance will also support businesses run by women, who face higher barriers to finance, through a gender action plan with Maxwealth to promote financial inclusion and women’s empowerment in the leasing sector. The syndication generated a market demand that surpassed the initial target amount, leading to an oversubscription.

Leasing services for MSMEs in the manufacturing sector is a key strategic direction of Maxwealth. With the mission of promoting regional economic development and industrial upgrading, Maxwealth aims to cover the “last mile” of financial services and to effectively solve the financing difficulties faced by MSMEs.

Maxwealth, a wholly owned subsidiary of Bank of Ningbo Co. Ltd., is a leasing company regulated by the National Administration of Financial Regulation. It leases assets to public utilities, intelligent manufacturing companies, and MSMEs. By June 2023, Maxwealth had more than 40,000 MSME clients, more than 30% of them owned by women.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.