The banking arm of the Gotianun-led Filinvest Development Corp. told the Philippine Stock Exchange yesterday that the Bangko Sentral ng Pilipinas (BSP), in a letter dated July 26, already “approved and confirmed” the proposed initial equity investment of EastWest Bank in its proposed wholly owned financial leasing firm, subject to the listed bank’s compliance with regulatory conditions set by BSP.
“We shall inform the Exchange as soon as we receive approval of the registration of the financial leasing company by the Securities and Exchange Commission,” the bank said in a brief disclosure.
EastWest Bank President and Chief Executive Officer Antonio C. Moncupa, Jr. said in a text message yesterday that the leasing firm will be called EastWest Leasing and Financing Corp.
“EW will put an initial P100 million [equity investments]. This completes the lending product menu of EW and gives us the opportunity to serve all the financing requirements of our customers,” Mr. Moncupa said. EW is the ticker symbol of EastWest Bank.
Mr. Moncupa earlier said that as banking systems in the region integrate, local banks will need to scale up to compete.
He said that EastWest Bank, to prepare for stiffer competition after rules regulating entry of offshore lenders were liberalized last year, aside from beefing up its main businesses and expanding its footprint, is also looking to venture into leasing, brokerage and wealth management businesses.
Earlier this year, the bank obtained the green light from the BSP to engage in bancassurance venture with the Belgium-based Ageas Insurance International NV, EastWest Ageas Life Insurance Corp.
EastWest Bank posted a P2-billion net income for 2015, down by 3% from the P2.073 billion it earned in 2014 due to lower trading gains, higher credit provisions, and higher tax expense.
In the first quarter, it posted a record first quarter net income of P786.6 million, 31% higher from the same period last year, driven primarily by its strong operating performance.
Shares in the bank ended trading at P20.40 apiece, down by 1.45% from the previous day’s close of P20.70 per share.
Gotianun-led East West Bank is also setting up its wholly owned financial leasing subsidiary as part of efforts to diversify its earnings stream as a universal bank.
The new unit will be called EastWest Leasing and Financing Corp. (EWLFC), bank president Antonio Moncupa Jr. said .
Moncupa said EastWest would put an initial equity of P100 million to set up the new venture.
In a disclosure to the Philippine Stock Exchange, EastWest said the BSP had allowed the bank to infuse the initial equity investment to set up the new unit.
“EWLFC completes the lending product menu of EastWest and gives us the opportunity to serve comprehensively the financing requirements of our customers,” Moncupa said.
The next step for EastWest is to await approval from the Securities and Exchange Commission to register the financial leasing company.
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