This is the first time a large global bank and a fintech have worked on a deal of this kind and structure in Southeast Asia
Validus and Citibank have established a US$100 million securitisation facility.
Collateralised by small and medium-sized enterprise (SME) loans originated by Validus in Singapore, this is the first time a large global bank and a fintech have worked on a deal of this kind and structure in Southeast Asia.
The facility is also supported by First Plus Asset Management, a Singapore-based multi-asset investment manager focused on Asia structured credit and equities.
Since the facility was established in Q2 2022, Validus doubled its borrower base in Singapore and grew its loan book by 60% across Validus Group over the same time period.
Validus said this tracks similarly stellar growth across the group, which has grown its monthly volumes by more than 8x and tripled its loan book over the last 24 months.
Milena Naitoh, head of corporate development at Validus, said: “This collaboration with Citi underscores the quality of our origination, credit portfolio management, strength and resilience of our business, in today’s market environment. With this evolution in our financing strategy, as well as the support of Citi as an established player in the asset-backed securities space, we are now even better positioned to support the growth of SMEs with accessible and effortless business finance.”
Naitoh added: “As Validus continues to extend its position as a leading all-in-one SME finance platform in Southeast Asia, this securitised lending structure, together with a diversified financing and product strategy, will enable us to grow at a much greater scale. We are honoured that Citi has chosen to collaborate with us on this landmark securitised lending transaction with a fintech start-up in Southeast Asia, and we are looking at replicating this transaction playbook across other markets.”
Lei Tie, co-founder and head of structured credit at First Plus, commented: “We are thrilled to be part of the transaction, which has established a gold standard for non-recourse asset-based financing for Southeast Asia, and to be able to support Validus on their next phase of growth.”
Validus is currently raising its series C equity round for an undisclosed amount.
The combination of the securitisation facility and series C equity funding will further drive the fintech’s expansion plans as it starts to introduce neo-banking products in other Southeast Asia markets.
Since its launch in 2015, Validus has disbursed over US$1.6 billion across more than 65,000 loans to small businesses in Singapore, Vietnam, Indonesia and Thailand.