MANILA - The Asian Development Bank (ADB) on Monday approved $350 million in additional headroom to further expand the scope and impact of its Trade Finance Program (TFP).

Supporting more than 12,000 small and medium-sized enterprises (SMEs) in developing Asia since 2009, TFP helps reduce market gaps for trade finance by providing loans and guarantees to financial institutions to support trade activities in the region.

The ADB said the additional financing will increase TFP's limit to $1.35 billion, keeping up with the increasing market demand for trade finance from the program, which grew over 50 percent in 2017.

TFP is able to support trade financing well above its limit over the course of a year but not breaching the limit at any one point in time by recycling transactions with short maturities and leveraging co-financing.

"The increased headroom will help us meet the huge surge we've seen in market demand for our trade finance products," said Steven Beck, head of Trade and Supply Chain Finance of ADB.

"It is an exciting time for the team, which is known for its excellent client services, including transaction processing in 24 to 48 hours," Beck said.

Financial institutions in support of trade as well as SMEs play an important role in closing the global trade finance gap, which amounts to $1.5 trillion globally, 40 percent of which is coming from the Asia and Pacific region, according to ADB's latest Trade Finance Gap survey.

TFP has guaranteed or funded 5,583 transactions in 2016 and 2017 alone, valued at $7.6 billion, with cofinancing reaching $4.6 billion.

TFP currently operates in 21 ADB members, with the top five most active markets including Armenia, Bangladesh, Pakistan, Sri Lanka and Vietnam.