However, much remains to be done given that transforming the corporate culture of any organisation – especially one that had its head stuck in the sand for far too long - will not happen overnight.
This is best demonstrated by the launch earlier this week of a new £136 million Wales Business Fund to support SMEs.
The good news that many have been waiting for is that Finance Wales has finally appreciated that there is a need for affordable finance to firms by reducing its lowest rate of interest for loans from eight per cent to four per cent.
This is something that the access to finance review proposed time and time again only to be told by a range of senior executives within Finance Wales and many in the corporate finance world that it simply could not be done.
Now that it has taken this step and halved its cost of lending, I am surprised that Finance Wales wasn’t shouting from the rooftops that it was finally delivering low cost loans to Welsh firms.
But whilst the reduction in the cost of finance is to be welcomed, perhaps the focus of the fund itself still leaves much to be desired as potential investments will range from £50,000 to £3 million, thus excluding the finance requirements of the majority of businesses in Wales.
Indeed, one of the major conclusions of the Development Bank report was that the focus of any new funding streams should be on micro-businesses (i.e. employing less than ten employees) given that they have created the majority of jobs during the last few years. In addition, Finance Wales’ own smaller existing micro-loan fund has been enormously successful in delivering funding quickly and effectively to this market.
Unfortunately, this new fund has failed to do address this need despite detailed research showing that applications below £25,000 by Welsh firms have the highest rate of rejection for both overdraft and loans by traditional banks.
In fact, if only half of the Wales Business Fund had instead been targeted at start-ups and micro-businesses, it could have backed around 3,000 firms across Wales and create thousands of new jobs. Instead, it will only support 415 firms over the next seven years at an average investment of £327,000 per business.
Given this relatively high level of investment, some may also be wondering where this new fund will fit in with new offerings from the high street banks that will also be competing in the same space.
For example, in the last six months HSBC has set up a £8 billion fund for SMEs whilst NatWest has made £1.1 billion of funds available to support small businesses in an attempt to boost SME confidence.
Other providers seem set to follow their example soon and it will be critical that if this new fund is to be effective, then it must work closely alongside these existing providers to support any gap funding rather than competing directly.
Therefore, it is clear that there has been progress within Finance Wales since the new senior management team took over and I am cautiously optimistic that this will continue.
However, the creation of a Development Bank for Wales is not just about making a few tweaks to Finance Wales. That is not what two years of detailed research and consultation concluded and definitely not what Assembly Members voted for last year.
We are not talking about a slow evolution of an organisation that did not deliver the economic benefits it could and should have done but a real revolution in which we have a financial and business support system that is the best that it can be and that puts Welsh businesses, rather than narrow commercial interests, first.
Wales badly needs a democratisation of business funding so that provision is not only focused on a small number of firms however worthy, but instead ensures that every viable enterprise that needs support is given this either directly by a new development bank or indirectly in partnership with other organisations.
Certainly, there needs to be urgent conversations with the Bank of England, the British Business Bank and the UK Government to make sure that the additional funds required to make this happen are available post-Brexit.
And what about the future of Finance Wales?
The Task and Finish Group looking into the development bank proposed that any new body should naturally build on the skills and experience of the staff within Finance Wales. But it should also fulfil the economic development requirements of the new Welsh Government and clearly demonstrate that it has both the strategic direction and operational ability to develop new approaches that will enable a step change in the funding of SMEs within Wales.
If this can be done and the support of Welsh SMEs remains its overall priority, then there is no reason why, going forward, a reformed Finance Wales should not form a key part of the Development Bank this economy badly needs.