Development bank celebrates impact as it reaches £1bn milestone

THE Development Bank of Wales has reached an investment milestone of £1bn which has supported more than 51,000 jobs since its creation eight years ago.

- SION BARRY

The bank, which is wholly-owned by the Welsh Government, was launched in November 2017 having evolved from what was Finance Wales.

The £1bn invested, through loans, equity investment and property related lending, has supported 51,089 jobs and generated £5.8bn in employment-based GVA (gross value added), while unlocking a further £363m in private sector co-funding.

Equity investments have totalled £138m.

Since its launch the development bank has seen 30 equity exits - although 16 involved firms that had received backing from its predecessor Finance Wales.

The original equity investment from the successful exits totalled £50.74m.

When also including fees, dividends and the repayment of loans provided to some of the equity recipient firms, the development bank calculated a 1.12 times return at £56.72m which is considered a below-par performance when bench marked against the wider private equity and venture capital sector.

Some 14 of the exits involved businesses that were only funded by the development bank. This involved a total equity investment of £13.77m, which on exit generated a 1.57 times return at £21.72m.

It said its equity investments leveraged 2.31 times co-investment of £317.7m.

Its debt funding, with an average deal size of £19,000, accounted for just over half (£564m) of the £1bn. Property related, both residential and commercial, funding amounted to £298m.

NEXT month, the International Convention Centre Wales will host the biggest-ever business event in Wales.

As we lead up to this major economic event (Wales International Investment Summit), I'm proud to share that the Development Bank of Wales has reached a significant landmark by investing over £1bn in equity, debt and property, creating and safeguarding over 50,000 jobs across the country.