[Photo: Heatec Jietong managing director Johnny Soon successfully got a government-backed loan from OCBC despite the credit crunch.]
By Francis Chan
IT WAS the onset of the financial crisis and the global credit crunch was just starting to kick in here.
Banks began to exercise more caution, owing to the threat of fast-evaporating liquidity, and started to clam up on lending especially for smaller companies.
For local firm Heatec Jietong, which was still expanding at the time, the lack of funding would mean it might not be able to take on the new contracts it had been awarded.
'The marine oil and gas sector was still growing towards the end of last year and the new jobs we were getting would require me to increase my manpower substantially,' said Heatec Jietong managing director Johnny Soon.
The firm, which was founded in 1994, provides vessels docking in Singapore with services for their heat transfer and piping systems.
Mr Soon said that the new contracts Heatec Jietong had attained meant boosting his staff strength from about 1,200 to 1,400 by the end of this year to be able to deliver on those jobs.
But because of the credit crunch, Mr Soon was unable to get hold of more working capital from lenders.
However, things took a turn for the better once the Government announced the Risk Sharing Initiatives during Budget 2009.
'The banks were more careful before the Government introduced the risk-sharing scheme where it would take on 90 per cent of the loan default risk,' said Mr Soon. 'Because of that, I managed to get a Bridging Loan of $5 million from OCBC Bank.'
According to Mr Soon, the application process was fairly straightforward with his OCBC relationship manager helping him with most of the paperwork.
'Basically, I did nothing other than to provide all the information the bank required but I believe the loan was given to us simply because our order books for 2009 have already been filled,' he said.
'In fact, I can say we are forecasting a 20 per cent in revenue growth for 2009.'
