Development Bank of Wales Reports Record Levels of Equity Investment in Wales

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Development Bank of Wales , 15th June 2023

Figures released by the Development Bank of Wales today show a 66% growth in equity investments from £11.6 million in 2021/22 to a record figure of £22.9 million in 2022/23, £10.9 million of which was for 31 different technology ventures.

In a challenging economic context, which saw CPI at 10.1% in the 12 months to March 2023, businesses in Wales accessed 516 individual equity and debt investments totaling £124.2 million in 2022/23 through the Development Bank. Private sector co-investment of £114.5 million represented a ratio of 1:0.92* and the average deal size grew by 14% to £240,748.

Other highlights of 2022/23 include:

Equity and debt totaling £20.55 million to finance succession deals for 44 different businesses
£9.9 million for 320 micro loans of up to £50,000
2,552 jobs created and 2,117 jobs safeguarded
£19.25 million investment in 114 young entrepreneurs – including investment into a company with a director aged 17 years
£7.8 million awarded to tourism businesses from the Wales Tourism Fund
Investors registered with Angels Invest Wales rose to 334, with 102 individuals having made angel investments during the year

The commercial property sector also saw significant growth, with funding for 71,882 square feet of new premises. Investments totaling £6.67 million from the Commercial Property Fund represented almost double the investment made in 2021/22.

Two new products were launched during the financial year, both a key part of the Development Bank’s commitment to helping new and existing customers to address decarbonisation, reduce their energy consumption and drive the low carbon agenda. The £10 million Green Business Loan Scheme received 25 new enquiries in the first month alone while the launch of the £33 million Green Homes Incentive in July 2022 gives new home developers a reduction in loan fees of up to 2% subject to a qualifying criteria.

Welcoming the strong performance, Economy Minister Vaughan Gething said:

“The Development Bank of Wales is going from strength to strength in providing innovative, responsive support that businesses need now more than ever.

“Across a year when economic conditions and uncertainties led many high street lenders to be more risk averse, retrenching their positions, the Development Bank has helped keep a vital flow of accessible finance available to businesses right across Wales.

“The Welsh Government took bold action in creating the UK’s first regional bank with a service that is able to act at scale while understanding the needs of the Welsh economy.

“The broad suite of funds offered by the Development Bank of Wales has helped hundreds of businesses leverage investment and secure the funding they need to invest and grow, and I would encourage businesses to consider whether the bank could support their next steps.”

Chair of the Development Bank of Wales, Gareth Bullock said:

“Against a backdrop of rising inflation, economic uncertainty and significant cost of living pressures, we entered the year more determined than ever to ensure that we had the funding and the firepower necessary to meet customer demand.”

“I am pleased that we have continued to grow overall investment levels, supporting a broad range of businesses across the nation and playing our part in making sure that ambitious businesses can access the investment they need. We will maintain that focus on delivery in the coming year, working together with our stakeholders in the Welsh ecosystem to support people, businesses and communities across Wales.”

Chief Executive of the Development Bank, Giles Thorley said:

“As one of the most active venture capital investors in the UK, we’ve continued to work with the private sector and new funds entering the market to maximise the value for Wales. We have also put significant effort into promoting equity as being a key enabler of business growth. It plays an important role in the complete life cycle from seed and early- stage investment through to established, privately-owned businesses looking to fund succession and exit. Indeed, over £20 million was invested in succession deals during the year, retaining wealth and goodwill in Wales.

“2022/23 has also seen us further grow our role as a responsible investor, evolving our decision-making processes to increasingly focus on environmental, social and governance factors. We’ve signed up to the world’s largest voluntary corporate sustainability initiative, Principles for Responsible Investment (PRI) and launched two new products that are already helping fund Welsh businesses to reduce their carbon emissions and embrace the journey to net zero as part of our commitment to promoting and advancing a green future in Wales.

“We’ve delivered a creditable performance for Wales in the last year and will continue to focus on maintaining the support for the long-term sustainability of the Welsh economy.”

*The private sector co-investment figure of £114.5 million includes three particularly large deals with a £32.3 million funding package for Creo Medical, £10.8 million for QLM and £12 million for Coin Cover.

Mae ffigurau a ryddhawyd gan Fanc Datblygu Cymru heddiw yn dangos twf o 97% mewn buddsoddiadau ecwiti o £11.6 miliwn yn 2021/22 i ffigur uchaf erioed o £22.9 miliwn yn 2022/23, ac roedd £10.9 miliwn o hynny ar gyfer 31 o fentrau technoleg gwahanol.

Mewn cyd-destun economaidd heriol, a welodd Mynegai Pris Defnyddwyr (CPI) yn 10.1% yn y 12 mis hyd at fis Mawrth 2023, cafodd busnesau yng Nghymru fynediad at 516 o fuddsoddiadau ecwiti a dyled unigol gwerth cyfanswm o £124.2 miliwn yn 2022/23 drwy’r Banc Datblygu. Roedd cyd-fuddsoddiad sector preifat o £114.5 miliwn yn cynrychioli cymhareb o 1:0.92* a thyfodd maint bargeinion ar gyfartaledd 14% i £240,748.

Mae uchafbwyntiau eraill 2022/23 yn cynnwys:

Ecwiti a dyled yn dod i gyfanswm o £20.55 miliwn i ariannu bargeinion olyniaeth ar gyfer 44 o fusnesau gwahanol
£9.9 miliwn ar gyfer 320 micro fenthyciad o hyd at £50,000
2,552 o swyddi wedi'u creu a 2,117 o swyddi wedi'u diogelu
Buddsoddiad o £19.25 miliwn mewn 114 o fentergarwyr ifanc – gan gynnwys buddsoddi mewn cwmni sydd â cyfarwyddwr sy’n 17 oed
Dyfarnwyd £7.8 miliwn i fusnesau twristiaeth o Gronfa Twristiaeth Cymru
Cynyddodd y buddsoddwyr sydd wedi cofrestru gydag Angylion Buddsoddi Cymru i 334, gyda 102 o unigolion wedi gwneud buddsoddiadau angylion yn ystod y flwyddyn

Gwelodd y sector eiddo masnachol hefyd dwf sylweddol, gyda chyllid ariannu ar gyfer 71,882 troedfedd sgwâr o adeiladau newydd. Roedd buddsoddiadau gwerth cyfanswm o £6.67 miliwn o’r Gronfa Eiddo Masnachol yn cynrychioli bron i ddwbl y buddsoddiad a wnaed yn 2021/22.

Lansiwyd dau gynnyrch newydd yn ystod y flwyddyn ariannol, y ddau yn rhan allweddol o ymrwymiad y Banc Datblygu i helpu cwsmeriaid newydd a phresennol i fynd i’r afael â datgarboneiddio, lleihau eu defnydd o ynni a llywio’r agenda carbon isel. Derbyniodd y Cynllun Benthyciadau Busnes Gwyrdd gwerth £10 miliwn 25 o ymholiadau newydd yn ystod y mis cyntaf yn unig, tra bod lansiad y Cymhelliant Cartrefi Gwyrdd gwerth £33 miliwn ym mis Gorffennaf 2022 yn rhoi gostyngiad o hyd at 2% yn y ffioedd benthyca i ddatblygwyr cartrefi newydd yn ddarostyngedig i feini prawf cymhwyso.

Wrth groesawu’r perfformiad cryf, dywedodd Gweinidog yr Economi, Vaughan Gething:

“Mae Banc Datblygu Cymru yn mynd o nerth i nerth wrth ddarparu cymorth arloesol, ymatebol y mae busnesau ei angen nawr yn fwy nag erioed.

“Ar draws blwyddyn pan arweiniodd amodau economaidd ac ansicrwydd at lawer o fenthycwyr stryd fawr yn bod yn fwy amharod i gymryd risg, er mwyn arbed arian yn eu sefyllfaoedd, mae’r Banc Datblygu wedi helpu i gadw’r llif hanfodol o gyllid hygyrch fel ei fod ar gael i fusnesau ledled Cymru.

“Fe gymerodd Llywodraeth Cymru gamau beiddgar wrth greu banc rhanbarthol cyntaf y DU gyda gwasanaeth sy’n gallu gweithredu ar raddfa tra’n deall anghenion economi Cymru.

“Mae’r gyfres eang o gronfeydd a gynigir gan Fanc Datblygu Cymru wedi helpu cannoedd o fusnesau i drosoli buddsoddiad a sicrhau’r cyllid sydd ei angen arnynt i fuddsoddi a thyfu, a byddwn yn annog busnesau i ystyried a allai’r banc gefnogi eu camau nesaf.”

Meddai Cadeirydd Banc Datblygu Cymru, Gareth Bullock:

“Yn erbyn cefndir o chwyddiant cynyddol, ansicrwydd economaidd a phwysau costau byw sylweddol, aethom i mewn i’r flwyddyn yn fwy penderfynol nag erioed i sicrhau bod gennym y cyllid a’r gallu angenrheidiol i gwrdd â galw cwsmeriaid.”

“Rwy’n falch ein bod wedi parhau i gynyddu lefelau buddsoddi cyffredinol, gan gefnogi ystod eang o fusnesau ledled y wlad a chwarae ein rhan i sicrhau bod busnesau uchelgeisiol yn gallu cael mynediad at y buddsoddiad sydd ei angen arnynt. Byddwn yn cynnal y ffocws hwnnw ar gyflawni yn y flwyddyn i ddod, gan weithio gyda’n rhanddeiliaid yn ecosystem Cymru i gefnogi pobl, busnesau a chymunedau ledled Cymru.”

Dywedodd Prif Weithredwr y Banc Datblygu, Giles Thorley:

“Fel un o’r buddsoddwyr cyfalaf menter mwyaf gweithgar yn y DU, rydym wedi parhau i weithio gyda’r sector breifat a chronfeydd newydd sy’n dod i mewn i’r farchnad i sicrhau’r gwerth mwyaf i Gymru. Rydym hefyd wedi gwneud ymdrech sylweddol i hyrwyddo tegwch fel ffactor allweddol sy'n galluogi twf busnes. Mae'n chwarae rhan bwysig yn y cylch bywyd cyflawn o fuddsoddiad mewn busnesau cychwynnol a chyfnod cynnar hyd at fusnesau sefydledig, preifat sy'n bwriadu ariannu olyniaeth ac ymadawiad. Yn wir, buddsoddwyd dros £20 miliwn mewn bargeinion olyniaeth yn ystod y flwyddyn, gan gadw cyfoeth ac ewyllys da yng Nghymru.”

“Hefyd, yn 2022/23 gwelwyd ni’n tyfu ein rôl fel buddsoddwr cyfrifol ymhellach, gan esblygu ein prosesau o wneud penderfyniadau i ganolbwyntio fwyfwy ar ffactorau amgylcheddol, cymdeithasol a llywodraethu. Rydym wedi ymuno â menter cynaliadwyedd corfforaethol gwirfoddol mwyaf y byd, megis y Principles for Responsible Investment (PRI) ac fe lansiwyd dau gynnyrch newydd sydd eisoes yn helpu i ariannu busnesau Cymru i leihau eu hallyriadau carbon a chroesawu’r daith tuag at sero net fel rhan o’n hymrwymiad i hyrwyddo a hybu dyfodol gwyrdd yng Nghymru.”

“Rydym wedi cyflawni perfformiad clodwiw i Gymru yn y flwyddyn ddiwethaf a byddwn yn parhau i ganolbwyntio ar gynnal y gefnogaeth i gynaliadwyedd hirdymor economi Cymru.”

*Mae ffigur cyd-fuddsoddi’r sector preifat o £114.5 miliwn yn cynnwys tair bargen arbennig o fawr gyda phecyn cyllid o £32.3 miliwn ar gyfer Creo Medical, £10.8 miliwn ar gyfer QLM a £12 miliwn ar gyfer Coin Cover.