RAM Ratings has assigned AA3/Stable/P1 ratings to Malaysia Debt Ventures Berhad's (MDV or the Company) proposed RM2 bil Conventional and Islamic Commercial Papers/Medium-Term Notes Programmes. Concurrently, we have reaffirmed the Company's corporate credit ratings of AA3/Stable/P1. 

The ratings incorporate our expectation of strong support from the Government of Malaysia. MDV is a technology financier wholly owned by the government through the Minister of Finance and the Federal Land Commissioner.  

MDV is deemed highly strategic to the government given its role in promoting the growth of Malaysia's information and communications technology (ICT) sector, although the Company is not the only entity spearheading the nation's technology agenda. Established in 2002, MDV's mandate is to address the funding needs of young technology companies  particularly small and medium-size enterprises  that are unserved or underserved by commercial banks. 

MDV's strong relationship with the government has been evident since its inception. Support has been demonstrated through the partial conversion of MDV's debt to equity, government guarantees, sukuk funding cost subsidies and being entrusted to run government financing programmes to develop the technology sector.

MDV's financing portfolio contracted further to RM0.8 bil as at end-June 2021 (end-December 2019: RM1.0 bil), mainly driven by early redemptions relating to green energy projects as customers refinanced with commercial banks post plant completion. The Company has been more selective in underwriting over the last few years, which has caused its financing base to gradually reduce. MDV's financing book largely comprises financing extended to ICT (59%) and green technology (37%) sectors. About two-thirds of the portfolio comprised project-based financing that are mostly secured from government and government-related agencies as well as large corporates.

MDV's asset quality remains weak in view of its developme