By Makiko Yamazaki and Yuki Nitta

TOKYO (Reuters) – Mitsubishi UFJ (NYSE:) Monetary Group Inc (MUFG) will launch a brand new $300 million fund to supply debt financing to late-stage tech startups within the Asia-Pacific area, its chief government stated, as Japan’s largest lender seeks to faucet alternatives in rising economies.

The transfer comes amid a fundraising frenzy in Asia because the variety of unicorns, or privately held startups with a valuation of greater than $1 billion, has swelled.

The brand new debt fund will probably be created early subsequent yr by Mars Development Capital, a Singapore-based three way partnership between MUFG and Israeli monetary tech agency Liquidity Capital, Hironori Kamezawa informed Reuters in an interview.

MUFG will make a $300 million capital dedication to Mars, which is able to present debt financing to startups in later phases of progress together with unicorns.

If the investee companies finally select to go public, MUFG plans to help their preliminary public choices with its U.S. alliance associate Morgan Stanley (NYSE:), Kamezawa stated.

The fund’s financing selections will probably be primarily based on Liquidity Capital’s synthetic intelligence-driven credit score scoring mannequin that forecasts future earnings and money movement of a startup from real-time monetary and accounting information.

“We have seen immense wants from startups for debt financing” as a method to elevate funds with out lowering current shareholders’ possession, Kamezawa stated.

“It is often tough for us bankers to increase loans to these startups within the purple, however the Israeli agency’s credit score scoring mannequin has helped us out,” he added.

It is going to be Mars Development Capital’s second debt fund. The primary fund, arrange final yr, is concentrated on early-stage startups and presently has a $200 million capital dedication. Mars Development Capital has to this point clinched financing offers with 11 firms, in keeping with MUFG.