CIMB joins Petronas' vendor financing programme as panel bank

KUALA LUMPUR (Jan 20): Petroliam Nasional Bhd (PETRONAS) announced today that CIMB Bank Bhd and CIMB Islamic Bank Bhd (collectively CIMB) have joined its Vendor Financing Programme (VFP) as the 9th panel bank.

The three entities' collaboration was marked by a memorandum of understanding exchange ceremony held today, Petronas announced in a statement. The VFP is to offer financing solutions to small and medium enterprise vendors in the oil and gas service equipment sector, to grow their business and reach their full potential.

Petronas said the VFP is one of the initiatives under the Lestari programme — a solution and collaborative platform to empower SME vendors in the OGSE ecosystem, and a strategic collaboration between the Ministry of Entrepreneur Development and Petronas.

"The VFP was established in May 2018 to assist Malaysian OGSE vendors adversely affected by the oil price crisis in securing working capital and improving their cash-flow to sustain their businesses. Under the programme, Petronas helps banks facilitate their due diligence through vendor verification, thus simplifying the risk assessment process and reducing approval time," Petronas said.

By joining the VFP, CIMB will support the OGSE vendors of PETRONAS on value-chain financing with extensive commercial banking coverage across Peninsular Malaysia, Sabah and Sarawak. Following the exchange of the MoU, Petronas vendors will have access to these financing facilities to cater to their specific needs for procurements or contracts.

The strategic alliance between PETRONAS and CIMB will further empower SME vendors in embracing market volatility and challenging realities with an array of financing solutions well-matched to SME needs, while catalysing the development of the O&G ecosystem for the benefit of the nation, said Petronas' project delivery and technology (PD&T) group procurement vice president Liza Mustapha.

As at December 2019, she said 130 applications and RM814 million worth of funding has been approved.

CIMB Group's commercial banking chief executive officer (CEO) Victor Lee Meng Teck, meanwhile, said the collaboration with Petronas is well-aligned with the nation’s SME agenda, as well as CIMB’s strong commitment and focus on the SME sector. "We look forward to working hand-in-hand with PETRONAS to boost the growth and financial well-being of SMEs, while supporting OGSE, a key sector in the Malaysian economy, under Petronas' Vendor Financing Programme,” he said.

The other panel banks in the VFP are: Bank Islam, Malayan Banking Bhd (Maybank), RHB Bank, HSBC Bank Malaysia Bhd, United Overseas Bank (UOB), Export-Import Bank Malaysia Bhd (EXIM), Bank Rakyat and Bank Muamalat.