Business Desk :
United Commercial Bank (UCB) as the first local commercial bank has announced plans to launch a venture capital fund and a private equity fund, with a target size of Tk350 crore each, to add to the momentum in the alternative investment ecosystem of Bangladesh.
The publicly listed commercial bank in a disclosure on Tuesday said it would invest Tk100 crore in each of the funds as the sponsor and the rest of the amount would be raised from local and foreign investors.
The two funds, dedicated to providing equity and funding support to talented young entrepreneurs, will be managed by a planned alternative investment subsidiary of UCB named UCB Alternative Investments.
Despite the fact that Bangladesh lags behind in the alternative investment arena, it is going to take off in the coming days, said UCB Deputy Managing Director ATM Tahmiduzzaman.
He believes their initiative will be a catalyst for adding momentum due to the fund size as well as UCB’s reputation, expertise, and governance standards.
Alternative investment includes venture capital funding in early stage of potential young enterprises. Private equity investment then comes at the next stage of the recipient companies’ growth path.
Investors get their exits through the stock market listing of the invested firms or merger with another firm or selling shares to other investors.
Fund managers are responsible for choosing and nursing the recipient firms to help them grow and also creating returns for alternative investors.
