Speech by

Datuk Wan Azhar Wan Ahmad, Managing Director

of Credit Guarantee Corporation Malaysia Berhad (CGC)

at the MoU Signing Ceremony Between CGC and OCBC Bank

15 January 2008.


Yang Berbahagia Datoí Albert Yeoh, Director and Chief Executive Officer of OCBC Bank Malaysia Berhad

Distinguished guests, members of the media

Ladies and Gentlemen


Assalammualaikum and a very good morning to you.

Foremost, on behalf of Credit Guarantee Corporation, I would like to take this opportunity to thank OCBC Bank Malaysia Berhad in particular Datoí Albert Teoh for laying the groundwork for this milestone collaboration between our two organizations, which I believe will be mutually beneficial and enriching. I would also like to thank the officers involved in this initiative for their relentless efforts, leading to the signing of the Memorandum of Understanding today.

Ladies and gentlemen,

We are pleased to be associated with OCBC Bank, one of the top five foreign banks in Malaysia and Asia’s leading financial services group. With a strong presence in Malaysia especially in the small and medium-sized enterprises market, OCBC Bank offers valuable opportunities for CGC to further expand its SME outreach especially those business entities that were traditionally banking with OCBC. In fact, through this collaboration both the organizations could leverage on their combined network of 45 branches located nationwide to connect with a wider cross section of the SMEs.

OCBC Bank has been participating in CGCís guarantee schemes and in 2006, it was recognized as CGCís Top SMI Supporter under the foreign-owned bank category. Their commendable performance continued in 2007 where it emerged as the Top 3 financial institutions in terms of its contribution to SME financing through CGCís guarantee schemes. By making our Direct Access Guarantee Scheme (DAGS) and Direct Access Guarantee Scheme-Islamic accessible to OCBC customers, we are confident that OCBC would increase its participation in our schemes even further and contribute significantly to overall loans guaranteed to the SMEs. DAGS and DAGS-i have contributed more than RM1.5 billion in 2007 and it is projected to expand further in 2008. Our collaboration with OCBC is projected to contribute RM200 million or 10% of the total projection. We hope that the active participation of OCBC Bank will encourage other foreign banks to seize the opportunity and increase their contribution to SME sector development not only through direct financing but also via our guarantee schemes. With greater involvement of foreign banks comes wider options and access to financing for the SMEs.

Ladies and gentlemen,

As I have said earlier, our collaboration with OCBC is part of the SME outreach program that we have embarked since 2006. In the last two years, we further expanded our outreach by forging strategic alliance with more than 10 Islamic Financial Institutions and Development Financial Institutions. In addition, we have also taken the initiative to broaden our range of products and services. More credit enhancement products and services such as securitization, portfolio guarantee and credit information services have been gradually introduced and established. As you may recall, we have been party to the first SME loan securitization exercise undertaken in Malaysia together with Maybank. CGC has also entered into a strategic partnership with Aureos Capital to offer equity financing.


In the last six months, we have also introduced two new guarantee schemes, the latest being the ENHANCER-Islamic launched early this year. The ENHANCER-Islamic is not only aimed at enabling SMEs to access to alternate sources of financing but also to tap into the growing Islamic financing for SME sector that registered RM6 billion in growth in 2006[1]. We are also in the midst of establishing the SME Credit Bureau, a first in the country to offer SME credit ratings and credit-related information services. We are partnering with Dun and Bradstreet Malaysia Sdn Bhd and all work towards the setting up of the Bureau is progressing as planned. This initiative is of strategic importance to the national agenda of promoting a sound credit culture and greater transparency amongst the SMEs.

Ladies and gentlemen,

These are initiatives that we could not do without as the SMEs are quite dynamic and always in demand of a diverse range of financing facilities. Together, we can do more and I am confident that we would be able to play a bigger role in SME development by providing innovative financial solutions whilst establishing a mutually beneficial customer-banker relationship. Our collaboration holds promise as we could leverage on our distinctive and complementary strength.

In closing, I would like to once again thank OCBC Bank for making this collaboration possible. Today’s signing of MoU for the participation of OCBC Bank in CGCís DAGS and DAGS-i schemes is a first step towards a win-win partnership. As we share a common vision vis-‡-vis SME development, we look forward to working together to build an enduring partnership that will create greater financing access to SMEs and add value to both CGC and OCBC Bank.

Thank you.


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